The UK has recently launched the Developing Countries Trading Scheme (DCTS) which provides tariff reductions and simpler terms of trade to 65 developing countries, including Bangladesh.
The DCTS will be one of the most generous sets of trading preferences of any country in the world, helping to grow trade, boost jobs and drive economic growth, said British High Commission in Dhaka in a press statement.
This new scheme will replace the UK Generalised Scheme of Preferences and will come into force in early 2023. It demonstrates UK's commitment to strengthening a longer-term and mutually beneficial economic relationship with Bangladesh.
The DCTS will provide a clearer and streamlined trading arrangement for Bangladesh making it easier to produce goods using components from other countries without losing duty-free status.
Under the scheme, Bangladesh will continue to benefit from duty-free exports to the UK on everything but arms.
British High Commissioner to Bangladesh Robert Chatterton Dickson said, "The DCTS will harness the power of trade and the private sector to enable developing countries like Bangladesh to grow and prosper. The UK is one of Bangladesh's biggest export markets, with our annual trade partnership worth over $4 billion. Bangladeshi businesses will have easier access to the UK markets under the new scheme.
"Even after Bangladesh graduates from the least developed country status in 2026, it will retain duty-free access to the UK for 98% of its exports, including ready-made garments. We look forward to increasing trade in both directions as an increasingly prosperous Bangladesh buys more high-quality UK goods and services," he added.
The DCTS contributes to developing countries' integration into the global economy, creating stronger trade and investment partners for the future. It also reflects the UK's commitments to human rights and labour standards, incorporating powers to alter trade preferences in the event of serious human or labour rights violations.
The DCTS will also support the UK's obligation to anti-corruption, climate change and environmental conventions.