New Age Business - 17 April 2022
Govt eyes FTAs with seven countries, two blocs
The government is considering seven countries and two regional blocs as potential partners for signing free trade agreements to retain duty-free market access of Bangladeshi products after the graduation from the least developed country to a developing one in 2026.
The commerce ministry on Sunday announced a time-bound action plan on preferential market access and trade agreement to face the challenges of LDC graduation.
In the action plan, the government listed China, India, Japan, Korea, Singapore, Canada and Malaysia as the potential FTA partners for Bangladesh.
It also sees prospects in joining the Eurasian Customs Union and the Regional Comprehensive Economic Partnership, a free trade agreement among the Asia-Pacific nations.
In a national workshop on proposed time-bound action plan of the two LDC graduation related sub-committees held at Parjatan Bhaban in the city, experts said that to retain the existing preferential market access, Bangladesh would have to go for FTA and PTA with its major trading partners as the country would lose its duty-free benefits after the LDC graduation.
They discussed that after graduation in 2026, Bangladesh would get duty-free market access in the Europe Union and the United Kingdom until 2029 but the country would lose the facility in other countries in 2026.
According to the proposed action plan, Bangladesh would initiate a study on the impact of having FTA with China and India simultaneously and separately by the end of this year.
The government has already approached Japan and Korea for signing FTA.
The action plan said that the government would take initiative to assess the pros and cons of accessing the Regional Comprehensive Economic Partnership by December 2022.
The proposed action plan identified that article 29 of revised GSP regulation, ratification and implementation of 32 international conventions and meeting the rules of origin criteria would be the major challenges for Bangladesh in retaining existing market access in the EU.
In other countries, FTAs could be the only mechanism to retain duty-free market access, it said.
At the concluding session of the workshop, senior commerce secretary Tapan Kanti Ghosh said that signing FTA would be the important issue to retain duty-free market access after graduation.
‘Increasing private sector competitiveness is also an important issue as we have an international market but we are not fully ready to tap the opportunity,’ he said.
Tapan said that tariff rationalisation was another issue and the National Board of Revenue was working on it.
To negotiate FTA, Bangladesh would have to reduce supplementary and regulatory duties by 2026, he said.
‘The prime minister suggested starting work on FTA and PTA and she said if we do not take initiative in these regards we will have to face problems after 2026,’ commerce minister Tipu Munshi said.
He said that there was a dilemma over the tariff rationalisation.
‘We have to reduce duties to negotiate FTA. On the other hand, the NBR is thinking over the revenue loss,’ the commerce minister said.
He said that it was time to start work seriously through identifying possible challenges.
‘Along with the export markets we also have to tap the potential of the local market,’ Ahmad Kaikaus, principal secretary to the prime minister, said.
He said that stakeholders and academia should work collectively to identify and face the future challenges.
Federation of Bangladesh Chambers of Commerce and Industry president Md Jashim Uddin and Planning Commission member Sharifa Khan, among others, spoke at the event.