Bangladesh will continue to enjoy duty-free market access to Japan for three years after its graduation from the least-developed country (LDC) category, as Japan has amended its tariff system to extend preferential trade treatment for LDCs.
Tokyo formally notified the World Trade Organisation (WTO) on November 5 of the amendment to its Temporary Tariff Measures Law, allowing graduated LDCs to retain their trade privileges for an additional three years. The WTO’s Committee on Trade and Development acknowledged Japan’s reform on November 7, according to an official communication seen by The Financial Express.
The notification explained that Japan’s Generalised System of Preferences (GSP) is designed to boost exports from developing nations by applying reduced tariffs on designated goods, helping them expand export income and industrial capacity.
According to the reform, “Japan reformed its tariff system to allow least-developed countries to receive preferential tariff treatment up to three years after they graduate from the LDC category,” as stated in Article 8-2, paragraph 3 of the Temporary Tariff Measures Law.
Commenting on the decision, Dr Mohammad Abdur Razzaque, Chairman of Research and Policy Integration for Development (RAPID), said that Bangladesh will continue to enjoy the same duty-free benefits in Japan that it currently receives as an LDC — similar to the European Union’s post-graduation arrangement.
He described the move as “a positive step” for Bangladesh’s exporters, noting that Australia has already introduced a similar three-year facility, while China will extend LDC privileges for two years after graduation.
Bangladesh is set to graduate from LDC status in November 2026, and Japan remains one of its key export destinations, alongside the EU, US, UK, Canada, and India.
At the 2023 WTO Ministerial Conference in Abu Dhabi, member countries agreed that LDC trade benefits would continue for three years after graduation to ensure a smooth transition.
Without this extension, Bangladeshi exports — particularly ready-made garments (RMG) — would have faced tariffs ranging from 9% to 20%, depending on the market. Japan’s tariff on garments currently stands at 9%, compared to 12% in the EU, 11.5% in the UK, 16.2% in Canada, and 20% in India.
Fazlul Hoque, former president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), welcomed Japan’s move, calling it “an expected and encouraging step” that will help sustain export growth.
He urged both the government and industry to use this transition period to enhance port efficiency, reduce production costs, and improve competitiveness through better infrastructure and lower utility and borrowing rates.
Exporters have long stressed that duty-free access remains a key incentive for global buyers sourcing from Bangladesh. They also called for continued diplomatic efforts to secure extended transition periods with other major trading partners.
According to Export Promotion Bureau (EPB) data, Bangladesh earned US$1.18 billion from garment exports to Japan in FY2024-25, up from $478.48 million in FY2012-13, reflecting the growing strength of the country’s apparel trade with Japan.
