Financial Express | 25 October 2010
Draft guideline on FTAopposes deals with developed economies
A draft guideline prepared on Free Trade Agreement (FTA) has strongly suggested against striking FTAs with developed countries, but the same has encouraged similar deals with the countries having demand for Bangladeshi manpower, official sources said.
The draft has recently been prepared by the Bangladesh Tariff Commission (BTC) under the Ministry of Commerce (MoC) as a number of countries have long been showing their interest in signing FTAs with Bangladesh.
The MoC is now scrutinizing the draft of the BTC before placing it to the Cabinet Division for approval.
"We are examining the draft guidelines on FTAs. The draft has focused on almost all broader areas keeping in view the global trade situation," a top MoC official told the FE on Monday.
"We will soon seek approval of the guideline."
The guideline outlined separate strategies for FTAs with different categorie of countries, including, developed ones, countries with increasing demand for foreign manpower, countries of the Asian, South America and African regions.
The interested countries willing to sign FTAs with Bangladesh include India, Pakistan, Sri Lanka, Singapore, Malaysia and Indonesia.
Besides, the US has showed its interest to sign FTA with Bangladesh under the proposed Trade and Investment Framework Agreement (TIFA) and very recently Japan has asked Bangladesh to sign a similar deal under the proposed Comprehensive Economic and Partnership Agreement, top officials in the Ministry of Foreign Affairs said.
Due to lack of any policy decision, the country so far has not signed any FTA with any one of the interested countries. Two rounds of negotiation on the issue have already taken place with India and Pakistan, sources in the MoC said.
The draft guideline said since Bangladesh is enjoying duty free market access in most of the developed countries, there should be no reason to strike FTAs with those.
’Bangladesh as a least developed country has been enjoying duty-free access for almost all products to most of the developed countries. Progress is also being made in enhancing market access in those countries under the auspices of WTO. Bangladesh will continue to strengthen cooperation with these countries through arrangements other than FTAs,’ reads the draft of the guideline.
The guideline said the FTAs on both goods and services may be signed with countries having demand of manpower from Bangladesh.
’However, lack of long term arrangement with these countries regarding manpower export makes the manpower export vulnerable to frequent policy changes,’ said the draft.
It recommended signing of FTAs with countries of the Asian region which is considered as growth centre of the 21st century.
’Asian countries are going to be lucrative place for selling goods and services. It is therefore imperative to consider FTAs with these countries,’ the guideline said.
On South America, the draft guidelines said the decision on striking FTAs with South American countries should depend on prospect of complementary trade with Bangladesh.
’Negotiating FTAs with these countries may be explored depending on the potential for complementary trade." The draft reads.
The draft suggested to go for similar arrangement with some of African countries, which export commodities such as cotton, and basic raw materials.
The drafty guideline said the strategy of FTA for Bangladesh should consider both trade in goods and services. On trade in goods, it should cover tariffs, effective mechanism for removal of non-tariff barriers, rules of origin, customs cooperation, safeguard measure, dispute settlement mechanism and institutional mechanism to oversee and monitor the implementation of the agreements.