The European Union and Bangladesh initialled a new Partnership and Cooperation Agreement (PCA) on 21 April 2026, marking a significant upgrade in their 50-year relationship. This 82-article agreement replaces the 2001 framework, focusing on deepening ties in trade, investment, sustainable development, climate action, security, and migration.
The cooperation agreement was formalised by EU High Representative Kaja Kallas and Bangladesh’s Foreign Minister Khalilur Rahman on 21 April in Brussels.
The PCA sets out a broad framework to strengthen cooperation across political dialogue, trade and investment, and strategic areas including energy, transport, agriculture, migration, security, finance and maritime affairs. It also includes commitments tied to democracy, human rights, climate action and sustainable development.
Comprising 82 articles, the agreement reflects a more structured approach to bilateral engagement and is expected to support deeper integration across multiple sectors relevant to global supply chains.
Negotiations between both parties began in late 2024 and concluded earlier this year. The initialling of the text clears the path for formal signature and ratification, after which it will replace the existing 2001 Cooperation Agreement.
The EU is Bangladesh’s largest trading partner, with bilateral trade exceeding €22 billion. The new agreement is designed to navigate trade relations as Bangladesh prepares to graduate from Least Developed Country (LDC) status, which will affect its current duty-free, quota-free “Everything But Arms” (EBA) access to the EU by 2029.
Trade remains a central pillar of the relationship. The EU is Bangladesh’s largest trading partner, with bilateral trade exceeding €22bn (£25bn). Since 2001, Bangladesh has also benefited from the EU’s ‘Everything But Arms’ (EBA) scheme, which provides duty-free and quota-free access for all exports except arms and ammunition.
The partnership includes cooperation under the EU’s Global Gateway initiative, which funds renewable energy and infrastructure projects in Bangladesh.
The deal includes provisions for strengthened cooperation on migration, counterterrorism, and organized crime.
Discussions began in late 2024 and concluded in early 2026, aiming to modernize relations.
Following the initialling of the agreement, it now moves to formal signature and ratification by both the European Union and Bangladesh.
Bangladesh is seeking to transition from EBA to a future Free Trade Agreement (FTA) or a new preferential regime following its LDC graduation to protect its garment export sector, which makes up roughly 90% of its exports to the EU.
BGMEA had not responded to Just Style’s request for comment at the time of writing, and Euratex declined to comment.
In February, receipts from Bangladesh apparel exports fell 4.8% year-on-year in November to $3.14bn, according to official data from Bangladesh’s Export Promotion Bureau (EPB).
Demand in Europe and the US – Bangladesh’s two largest apparel markets – remained under strain, with cautious retailer orders weighing on suppliers.
“Bangladesh, EU strike deal on trade, investment, sustainable development” was originally created and published by Just Style, a GlobalData-owned brand.
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