USA to sign Free Trade Agreement with Bangladesh : Post-MFA situation looks promising
10 February 2005
BSS, Dhaka, Feb 10: The US ambassador Harry K Thomas said in Dhaka on Tuesday that Bangladesh is now poised to bigger market gains in the US in the post MFA business environment.
He further said his government and Bangladesh would sign a bilateral free trade agreement following the signing of the proposed Trade and Investment Facilitation Agreement (TIFA) that may take place shortly to exploit the business and economic potentials on both sides.
Exchanging views with the members of the Economic Reporters Forum (ERF) at the Jatiya Press Club, the US envoy said the post MFA situation looks very promising for Bangladesh.
Speaking on the theme ‘Trade with USA in the post MFA era’ Ambassador Harry K Thomas said it is not China or India that threaten Bangladesh’s market share so much as its own weaknesses in cutting back lead time and offering more competitive prices.
ERF president Monowar Hossain was in the chair while its general secretary Nurul Hassan Khan and Ahmed Ali of the American Center were present.
Harry K Thomas identified absence of a deep-sea container port, efficient road and other transportation and telecommunication facilities as some of the major weaknesses that Bangladesh should overcome quickly to take advantage of the post- MFA era.
These actions are needed for Bangladesh to be economically strong and having a divergent export basket for tomorrow, he said making a strong case for quick government actions in all these fronts. He dismissed concerns that the country’s garment export may suffer setback in the new situation and workers may lose jobs.
He told a questioner that in these days the knitwear sub- sector in Bangladesh is going under tremendous expansion and the fears that workers will lose jobs is simply not true. But, he said it is not wise either to rely on 74 per cent of the country’s export earnings coming from the RMG sector alone. There is a big need for export diversification, he pointed out.
The US envoy said with a view to widening the export basket, the USAID is supporting modernization of shrimp industry in Khulna region. It is also funding the JOBS activities for the development of small and medium enterprises and their export including setting up of new IT firms in the country.
Pointing to his government’s policy that ‘trade not aid is the best way’ to strengthen Bangladesh economy, he said once the TIFA will be signed, the US investment here will simply multiply to the benefits of both the sides.
Referring to existing US investment in many areas including the gas sector, he said many US investors are also looking for partners here to go into new areas. To a question, he said health, education, road and infrastructure are some of the attractive areas.
To another question, he said gas export from Bangladesh is not an issue now. On the proposed gas pipeline from Myanmar to India through Bangladesh, he said, “ let’s see what comes next.”
The envoy dismissed a question that said if the recent spate of political activities will affect the US economic and business relations with Bangladesh. He said, “ I don’t see any such prospect.”
Replying to a question about the passage of a law now pending in the US senate to give duty free and quota free access to garment exports from some Asian and Pacific least developed countries, he said it is something that the US Congress will look into. The administration has nothing to do with it.
On TIFA, he said the Bangladesh government sent a draft to the US administration last year for comment. It remained pending while progress in sorting out issues like trade union activities in the EPZs and child and women trafficking took much of the time.
The US election then came up to cause further delay, he said and added now that both sides are ready to take up the issue and scheduled to meet at the commerce ministry soon. He hoped that the TIFA will be signed very soon to pave the way for signing the bilateral free trade agreement between the two countries.
He said Bangladesh economy has made some amazing strides in the recent years. He said in fact since the liberation, Bangladesh has made a name for itself in the garment industry. He said the key to further expanding trade relations abroad is to make the reliability of supply in shortest possible time and reducing the cost of doing business as competitive as possible.
He said, “We strongly support increased trade between the two sides.” For that he said the US is regularly holding trade fairs here and this time the US Trade Development Center is going to help Dhaka in organizing a road show for Bangladeshi entrepreneurs in three US cities in a bid to developing market for their products.
The US envoy said Bangladesh need to curb corruption and eliminate it in order to expedite the pace of economic growth and harness more external investments.