Signing fresh preferential trade agreement with EU stressed

FE REPORT | Published: October 28, 2021 09:03:10 | Updated: November 19, 2021 19:59:23

(Top, from left) DCCI President Rizwan Rahman, Commerce Minister Tipu Munshi, former BGMEA president Rubana Huq and other distinguished persons take part in a webinar titled 'Economic Tie of Bangladesh and Europe: New Regulatory Regime' held on Wednesday as part of the ongoing week-long Bangladesh Trade and Investment Summit 2021

Bangladesh's success stories with multinational businesses can help attract more foreign investment, especially from European countries, experts say while suggesting signing fresh preferential trading pact with the EU.

Besides, they feel, both Bangladesh and EU countries can benefit by investing in the country as favourable investment climate and technology transfer are mutually rewarding.

The views were expressed at a webinar titled 'Economic Tie of Bangladesh and Europe: New Regulatory Regime', held on the second day of Bangladesh Trade and Investment Summit 2021. It was jointly organized by the Ministry of Commerce and Dhaka Chamber of Commerce and Industry (DCCI).

They stressed the need for signing preferential trade agreement for post-LDC graduation Bangladesh.

However, the distinguished speakers also said both public and private sectors in the country need to become compliant with all conventions before applying for GSP+ facility on the EU market.

DCCI President Rizwan Rahman in his brief presentation said Bangladesh is one of the main trading partners of Europe, accounting for around 35 per cent of Bangladesh's total trade as of 2020.

"After LDC graduation, Bangladesh will face strict rules-of- origin requirement," he told the meet.

He said Bangladesh should sign FTAs/PTAs with the European Union (EU) and its decoupled-member UK, which will guarantee preferential market access for exports to the European market.

The business leader invited European investors to invest in pharmaceuticals and API sector as well as in the high-tech parks and SEZs in Bangladesh.

"Scope of European technology transfer will usher our farming compliance and export-oriented agro-processed food industries," he said.

The chamber chief also said a 'Comprehensive Economic Partnership Agreement' may be dealt between Bangladesh and Europe for preferential market access to the EU market.

Commerce Minister Tipu Munshi told the meet that after Bangladesh graduates from the poor-country club, the country would lose the 'Duty Free, Quota Free' market access.

He also said that in the draft of the new GSP regulation, which was published last month, the European Union has proposed to remove the import-share criterion from the GSP+ eligibility.

"Bangladesh will be direct beneficiary of this change," he said about the possible spinoffs from the changing trade regime.

But he urges all sectors, including public and private, to be cautious to become compliant in respect of all conventions before applying for GSP+ facility on the EU market.

Dr Rubana Huq, Managing Director of Mohammadi Group and former president of BGMEA, said, "Bangladesh has to ensure our better position in a sustainable manner."

The leading garment entrepreneur thinks LDC graduation will "open up new opportunities for us too".

She says in terms of compliant factories Bangladesh's position is commendable.

"But the buyers should also look into a sustainable pricing system," she said, urging the businesses to go for diversification and value-added products for better RMG-business gains.

Zaved Akhtar, CEO and Managing Director of Unilever Bangladesh Ltd, noted that Bangladesh is an emerging market of huge population. And it has been a "phenomenal journey" for the multinational-Unilever--here in Bangladesh.

Per-capita FMCG consumption in Bangladesh is still only $23 whereas it is 44 US dollars in India, 100 in the Philippines, he said, adding that there are more to explore in the country.

He also said that the demographic dividend is high in this country.

Momin Ud Dowlah, Chairman & Managing Director of EON Group of Industries, said Bangladesh is the third-largest vegetable producer, 3rd-largest rice producer and 3rd-largest Telapia fish producer.

European investors have good potential here in food- processing industry, he said.

Despite having an agro-friendly policy, he observed, the country still needs a few policy reforms. Bangladesh needs agro-mechanization and automation and investment in research and development to be competitive on the EU market.

Bangladesh can also be a big market of halal food if infrastructure and policy supports are given to halal industry, he added.

Yasir Azman, CEO of Grameenphone Ltd, said that in 25 years they have been able to become a success story on this market.

"There is a win-win situation in this market," the mobile multinational chief executive told his audience.

He said the youths of Bangladesh and technology and digitization will lead Bangladesh to become a developed nation by 2041.

"Bangladesh gives ample opportunities to the foreign investors," he said.

Naser Ejaj Bijoy, CEO of Standard Chartered Bangladesh, billed Bangladesh as a congenial market in terms of financial sector.

The banking multinational's country chief said there are challenges in this sector, but if all these challenges can be overcome, this market is a profitable one.

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