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The end of textiles quotas: A case study of the impact on Bangladesh

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  • Yongzheng Yang
  • Montfort Mlachila

Abstract

This paper assesses the effects on the Bangladeshi economy of phasing out textile and clothing quotas by industrial countries. Bangladesh relies heavily on textile and clothing exports and is potentially very vulnerable to the abolition of the quotas. We used up-to-date information on quota prices for Bangladesh to evaluate its competitiveness in a quota-free world, and subsequently incorporate the quota price information in the GTAP model to simulate the effects of quota phase out on Bangladesh. We also examine in detail the supply constraints facing Bangladesh's textiles and clothing industries. Based on this analysis, we conclude that without accelerated structural reforms Bangladesh is likely to face significant pressure on its balance of payments, output and employment in the aftermath of quota removal.

Suggested Citation

  • Yongzheng Yang & Montfort Mlachila, 2007. "The end of textiles quotas: A case study of the impact on Bangladesh," Journal of Development Studies, Taylor & Francis Journals, vol. 43(4), pages 675-699.
    • Handle: RePEc:taf:jdevst:v:43:y:2007:i:4:p:675-699
    DOI: 10.1080/00220380701259939
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    1. Anderson, Kym & Dimaranan, Betina V. & Hertel, Thomas W. & Martin, William J., 1997. "Asia-Pacific food markets and trade in 2005: a global, economy-wide perspective," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 41(1), pages 1-26.
    2. Debapriya Bhattacharya & Mustafizur Rahman, 2000. "Experience With Implementation Of Wto-Atc And Implications For Bangladesh," CPD Working Paper 7, Centre for Policy Dialogue (CPD).
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    Cited by:

    1. Vasishth, Mahima, 2024. "Employment Booms and Infant Health: Evidence from the Ready-Made Garment Sector in Bangladesh," IZA Discussion Papers 17106, Institute of Labor Economics (IZA).
    2. Sinkovics, Noemi & Hoque, Samia Ferdous & Sinkovics, Rudolf R., 2018. "Supplier Strategies and Routines for Capability Development: Implications for Upgrading," Journal of International Management, Elsevier, vol. 24(4), pages 348-368.
    3. Sarker, Rakhal, 2018. "Trade Expansion, International Competitiveness and the Pursuit of Export Diversification in Bangladesh," Bangladesh Development Studies, Bangladesh Institute of Development Studies (BIDS), vol. 41(02), pages 1-25, June.
    4. Traverso, Silvio, 2016. "How to escape from a poverty trap: The case of Bangladesh," World Development Perspectives, Elsevier, vol. 4(C), pages 48-59.
    5. Micheline Goedhuys & Norbert Janz & Pierre Mohnen, 2014. "Knowledge-based productivity in "low-tech" industries: evidence from firms in developing countries," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 23(1), pages 1-23, February.
    6. Anup Kumar Bhandari, 2021. "Withdrawal of the multifibre agreement and Indian textile industry: Concerns, efforts, and achievements," Review of Development Economics, Wiley Blackwell, vol. 25(3), pages 1397-1436, August.

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