The third Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) summit concluded this week in the Myanmar capital of Nay Pyi Taw, renewing the member-states' commitments to strengthening cooperation in areas of trade and investment, energy, counter-terrorism and trans-national crime.
The member-countries of the forum also, as the reports said, have agreed to expand cooperation in sectors like transport and communications, technology, tourism, agriculture, cultural cooperation, environment and disaster management, poverty alleviation and climate change.
Addressing the summit, Bangladesh Prime Minister Sheikh Hasina made strong pleas for intensifying efforts by all the member-countries in a concerted way to make the region a secure, stable and prosperous one through combating poverty and meeting other challenges. She said the forum needs to move forward with collective efforts, based on mutual respect and trust for equitable sharing of benefits.
The Declaration, adopted in the summit, said the leaders of this regional grouping are convinced that its member-states, being endowed with abundant natural and human resources, have considerable potential for economic and social development through mutually beneficial cooperation in identified priority areas. They have reiterated firm commitment to making efforts to help alleviate poverty in the region in order to ensure dignity and improve the quality of life, of the peoples.
The leaders are also convinced that harmony, prosperity and well-being among the member-states can be enhanced through deeper economic and social cooperation, enhanced connectivity, sustainable development, harnessing of common natural resource base and cultural and people-to-people linkages. Furthermore, they have agreed to intensify efforts to deepen cooperation in all areas of activities within the framework of the forum.
It is worthwhile to note here that although the forum has been in force for a pretty long time, it has not yet been able to make an impact on the economic fields of its member-countries. It has not come forward pro-actively in mutual support during the times of natural disasters or during the price-hike of food experienced by its member-countries. It thus remains largely unknown as a regional body among the people. The BIMSTEC was formed as an international organisation but, in fact, it operates as a one of the malfunctioning regional bodies; its functions often overlap with those of other such organisations. .
Existing trade as well as investment in the BIMSTEC area is negligible. The member-countries ought to be proactive to exploit the potential to boost the intra-regional trade. Besides boosting intra-regional trade, the grouping can be an alternative to trade expansion in traditional markets in Europe and North America that are facing uncertainties due to various reasons.
The present intra-regional trade turnover among the member-countries of the BIMSTEC is only a small fraction of their total trade. Unlike other regional organisations, the intra-regional trade and investment of the BIMSTEC member-countries is not much. It goes to show that there is considerable potential for expansion of trade and investment in this region.
BIMSTEC brings together 1.3 billion people or 21 per cent of the world population, a combined gross domestic product (GDP) of US$ 750 billion, and a considerable amount of complementarities. A study shows that the BIMSTEC has the potential to create trade worth $43 to 59 billion with a Free Trade Agreement (FTA) in place.
To meet the challenges facing it, the BIMSTEC will have to strengthen its management structure in such a way that other regional bodies cannot get any edge over it. As regards the areas of cooperation, there could be more significant, diversified, rewarding and viable programmes or projects for each member country to make the organisation more effective and attractive.
Bangladesh, as a lead country in the area of trade and commerce, needs to make its best of endeavours to take full advantages and opportunities in areas of exports, foreign direct investment, tariff concessions, market access etc. The initiatives of Bangladesh to fight against poverty and reduce the same to half, as per targets of the Millennium Development Goals (MDGs), merit support by the member-states of the BIMSTEC.
It is essential for the BIMSTEC members to actively consider the impacts of climate change, global warming and recent price-hike of food and energy on poverty and to tackle these challenges collectively. The developed nations should come forward along with the BIMSTEC member-countries to successfully overcome these problems.
The institutional framework of BIMSTEC member-countries should be devised for intensive and extensive research investigation and, ultimately, development of programmes, incorporating the best practice examples. More focused programmes might be considered for cooperation among the member-countries to have a significant impact on poverty reduction.
Indeed, the forum does provide a unique link between South Asia and Southeast Asia. Many regions of the world had achieved fruitful results in trade, industry, tourism, monetary cooperation and technology transfer, resulting in better standards of living and, thus, quality of life for the people through regional collaborations. It is possible to have a far-reaching impact on the development through regional cooperation.
A recent ministerial meeting of the BIMSTEC took one most important decision relating to introduction of free trade in the region, besides that of having a permanent secretariat for it based in Dhaka. Apropos free trading arrangement, it will in the first phase facilitate trading in goods and then it will be in the services and investment under the FTA. The volume of intra-regional trade would be increased between $40 and $60 billion every year once complete trade liberalisation takes place under the FTA agreement.
Regional cooperation is no longer a matter of choice for the countries of South Asia in particular. At a time when countries throughout the world are regrouping on the basis of economic blocs, South Asia can ill-afford to remain immobilised in political discord. On the economic front, South Asian countries have been more enthusiastic about opening their domestic markets to ones outside the region rather than to each other. Only 13.3 per cent of South Asian total trade is within the region compared to over 55 per cent for Association of South East Asian Nations (ASEAN) member-countries. A small step towards economic integration could bring net benefits of $2.0 billion.
Just as the ASEAN FTA resulted in both greater intra-regional trade and greater foreign investment among South-East Asian nations, so too will be the benefits of BIMSTEC. The Declaration of the Myanmar summit carries the greater promise of sustainable regional economic growth and development.
The BIMSTEC is, thus, a regional grouping, now with a promise. Efforts need to be made at this stage to make its presence felt widely. The membership of the forum spans India, Bangladesh, Sri Lanka, Nepal and Bhutan, on the one hand, and Myanmar and Thailand, on the other. Its member-countries, thus, constitute two flanks of Asia -- South Asia and South East Asia.
The outcome of this week's Myanmar summit does otherwise provide indications about the BIMSTEC's potential to emerge as a strong regional force to reckon with. But effective follow-up actions on the decisions of the summit will be critically important to translate the promise into a reality.
szkhan@dhaka.net
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