Japan relieves GSP rules for Bangladesh knitwear exports following request from government
Effective from April 2011, the Japanese government has relaxed the rules of origin under the Generalized System of Preferences(GSP) on exports of knitwear from Bangladesh. The relaxed rules of origin applies to knitting and dyeing and sewing and knitwear products, which will now enjoy the benefit of GSP.
Previously knitwear products were subject to 17 per cent duties as Japan tried in vain to cling to its aging knitwear industry, but the rules have been relaxed following a request from the Bangladesh government
Even with the duty, the exports of knitwear from Bangladesh increased by 231 per cent over the last 10 months whilst all readymade garments enjoyed a steady growth of 175 per cent between the period 2008-2010. The new relaxed rules of origin will enable the knitwear industry to further increase its share of the Japanese market as Japan is keen to reduce its dependence on China. The Japanese “China + 1” policy promotes shifting of production in China to other nations such as Bangladesh.
