Step up trade pact efforts ahead of LDC exit: Experts

Ahead of Bangladesh's graduation from the least developed country (LDC) club, the government has been urged to intensify its efforts to secure free trade agreements (FTAs) and comprehensive trade pacts.

The call came from a discussion organised by the Institute of Chartered Accountants of Bangladesh (ICAB) in Dhaka, where economists elaborated on the importance of pre-graduation preparation.

"Bangladesh faces a future without preferential market access after 2026," said Professor Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue (CPD).

"This necessitates significant efforts towards product and export diversification to ensure continued export growth," said Professor Mustafizur Rahman as he called for pursuing more FTAs and comprehensive trade agreements.

"After 2026, with the loss of duty-free, quota-free market access, product diversification will be essential for our export survival. We need to diversify our export base," he added.

The discussion was titled 'The outcome of the 13th Ministerial Conference, Abu Dhabi, UAE'. Professor Rahman was the chief discussant and presented a paper on the conference's outcome. ICAB President Mohammed Forkan Uddin delivered the welcome address.

The CPD distinguished fellow said, "In the past 53 years, 60 countries have transitioned from LDC to developing country status. Currently, 15 countries are at various stages of LDC graduation and five, including Bangladesh, have confirmed graduation dates."

"If all goes according to plan, Bangladesh will graduate to developing country status by November 2026. Consequently, we must strongly negotiate continued preferential treatment, such as duty-free and quota-free access, which is currently available to LDCs for a limited grace period. We need to discuss extending these benefits with countries like Japan, Canada, and South Korea, who currently offer tariff concessions to LDCs," he said.

According to him, Bangladesh faces a "three-stage challenge": its current LDC status, its imminent graduation and its future as a developing country.

He called for strategic development that prioritises production efficiency and competitiveness in the global market.

To secure flexibility on fisheries subsidies, he said Bangladesh needs to take steps to negotiate and enter into various agreements. Currently, e-commerce in LDCs enjoys zero tariffs.

"This saves the country about $40 million annually in customs duties. This is also an area for discussion," Dr Rahman added.

ICAB President Mohammed Forkan Uddin said the country needs to consider the post-graduation scenario regarding preferential market access, treatment for services and service suppliers, and special treatment under WTO rules.

The WTO Ministerial Conference extended the e-commerce moratorium for two years, he added. "Even with some revenue loss, this will support the government's Smart Bangladesh Vision by 2041."

Mr Uddin identified fisheries and agricultural subsidies as two other key issues where Bangladesh's efforts have not yielded the expected success.

Manzoor Ahmed, advisor to the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), advocated for integrating foreign trade through regional, bilateral and alternative commercial agreements.

ICAB CEO Shubhashish Bose, Md. Hafizur Rahman, member, Bangladesh Competition Commission,; Md. Al Amin Pramanik, economic minister, Permanent Mission of Bangladesh to the United Nations and other International Organisations in Geneva, Switzerland; Mohammad Mashooqur Rahman Sikder, Joint Secretary (WTO Section-2), Ministry of Commerce and Dr. Mostafa Abid Khan, Component Manager, LDC Graduation Project, Economic Relations Division (ERD), among others, also spoke on the occasion.

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