Dhaka, Nov 5 (Inditop.com) The European Union’s bilateral free trade agreements (FTAs) with India, Southeast Asian nations and South Korea may pose a potential threat to Bangladesh, a report quoting officials of the European Commission has said.
EU is the Bangladesh’s largest trade partner. Over half of the country’s total exports of $15 billion were destined for EU last fiscal year.
“The European Union’s FTA with India, ASEAN (Association of Southeast Asian Nations) and South Korea is definitely a concern for Bangladesh,” Zillul Hye Razi, trade adviser to EC Delegation in Dhaka, told a seminar on “EU-Bangladesh trade relations: Trends and challenges”.
He cited the example of Bangladesh’s bicycle exports to EU under duty- and quota-free facility. India needs to pay high duty (17 percent) for bicycle exports to EU, but an FTA will remove this tariff barrier, making it a fierce competitior to Bangladesh.
Commerce Minister Faruk Khan spoke as chief guest at the inaugural session of the seminar.
Stefan Frowein, head of delegation of the European Commission to Bangladesh, senior government officials, trade experts and businesspeople took part in the discussion.
Jenni Lundmark, trade programme manager of EU to Bangladesh, presented a paper on the European Commission’s trade-related technical assistance programmes in the country.
“The FTAs of the EU with India, ASEAN and South Korea are the biggest challenge for Bangladesh’s future trade with Europe,” said Lundmark.
Even Bangladesh’s garments exports may face a huge competition from these countries, she added.
Readymade garments and knitwear earn the highest foreign exchange for Bangladesh that finds itself in competition with a host of Asian countries in high-spending markets.
The EU has been in talks for FTAs with India, ASEAN and South Korea since 2007. Negotiations with India and Korea are going on in full swing, while it is relatively slow with ASEAN due to political sensitivities and a lack of integration between the members of the bloc.
The panelists said Bangladesh needs a comprehensive trade policy, The Daily Star reported Thursday.
Proper utilisation of generalised system of preferences (GSP) offered by Europe to least developed countries, including Bangladesh, is also vital, they said.
