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Dhaka softens on graft, transparency in TIFA : Draft agreement almost ready

Daily Star, Dhaka

Dhaka softens on graft, transparency in TIFA
Draft agreement almost ready

Staff Correspondent

15 February 2005

Bangladesh and United States trade officials are close to finalising a draft for a trade and investment framework agreement (TIFA), as Dhaka softened its positions on key debated issues in the first day of the third round of talks that began in Dhaka yesterday.

Bangladesh budged from its earlier stance of excluding from the TIFA draft a clause related to transparency, bribery and corruption in international trade and investment, sources in the Ministry of Commerce said.

Betsee E Steelman, a senior US trade policy advisor for Asia and the Pacific, is leading the US side while Elias Ahmad, the Joint Secretary of the commerce ministry, is leading the Bangladesh side. The two-day talks are being held at the commerce ministry.

Bangladesh, fearing that a ’bribery and corruption’ clause might undermine Bangladesh’s image, wanted to replace it with a ’prevention of malpractice’ clause. The US side argued, however, that including the clause would not affect Dhaka’s image as it is a bilateral deal.

In the draft, the US government proposed that under TIFA the two governments will establish a ’US-Bangladesh Council on Trade and Investment’, which will meet at least once a year. The Commerce secretary will lead the Bangladesh side in the council meeting while a designated official of the US Trade Representative (USTR) office will lead the US side.

Bangladesh accepted the US proposal for the joint council but insisted that an official of equal status from the USTR office lead the US side.

The US government originally proposed the TIFA to Bangladesh in 2002 to promote trade and investment between the two countries.

The Ministry of Commerce agreed to begin negotiations with the US on the issue during an inter-ministerial meeting in January 2003.

Since then, the two sides have held several rounds of talks and also worked to prepare a draft of the agreement. Bangladesh has several times proposed additions to the draft and changes to some of its clauses and articles. The draft likely finalised during yesterday’s meeting has 19 clauses and seven articles.

Ministry sources said Bangladesh would press the US government to consider a free trade agreement after signing the TIFA.

According to the draft, TIFA will cover removal of non-tariff barriers, implementation of intellectual property rights, promotion of trade and private investment, improvement of worker’s rights, and pursuing WTO talks on the basis of the Doha Development Agenda.

Bangladesh enjoys a favourable position in trade with the US. The US exported $281 million worth of products to Bangladesh in 2003-2004, while it imported $2.3 billion, making America’s trade deficit around $2 billion. The US is Bangladesh’s largest investor, with total investment, mainly concentrated in the energy and power sector, topping $1.4 billion.