By Elishya Perera
DHAKA, Bangladesh (CWBN)_ Bangladesh has initiated negotiations with the Association of South-East Asian Nations (ASEAN) for a Free Trade Agreement (FTA), the Secretary of the Ministry of Commerce said yesterday (Dec 13).
“I signed the negotiation letter today [Sunday] and sent it to the foreign ministry to open formal negotiations with the ASEAN headquarters, so that we can sign an FTA with this major trade bloc,” Commerce Secretary Md Jafar Uddin noted.
Uddin said an FTA with the bloc would be significant since Bangladesh would otherwise have to sign bilateral agreements with the 10 member countries, following the Asian country’s graduation from the least developed country grouping in 2024.
“Otherwise, we have to sign either a Preferential Trade Agreement (PTA) or FTA with the ASEAN member countries like Indonesia or Malaysia so that we can exploit the business opportunities of this major trading bloc,” he said.
Although Bangladesh is at the final stage of negotiations for a Preferential Trade Agreement (PTA) with Indonesia for non-tariff benefits on selected goods, however, negotiations are facing a roadblock, since the latter refuses to agree with certain terms, particularly regarding several major export items such as garments.
Bangladesh has been a member of the ASEAN since 2006, which has paved the way for a vital market, in which the total expenditure on clothing and footwear totalled $51.2 billion in 2017. The Southeast Asian countries are also an important source for one of Bangladesh’s main industries, the apparel sector.
As a Least Developed Country (LDC), Bangladesh currently enjoys zero-tariff benefits, regional trade benefits and preferential trade benefits on exports to 38 countries globally.
However, the World Bank says that the Asian country is on track for graduation from its position as an LDC by 2024, following which, all tariff benefits will be lifted.
Therefore, Uddin said the Commerce Ministry in Dhaka has been negotiating with 11 other countries and trade blocs including Australia, Japan, China and Canada for PTAs, in order to secure trade privileges beyond 2024.
