One of the significant achievements of Bangladesh over the last 15 years is our global recognition as a development miracle and economic powerhouse of Asia under the visionary and dynamic leadership of the Hon'ble Prime Minister Sheikh Hasina. While Bangladesh is set to graduate from the Least Developed Countries category in 2026 after three successful evaluations, the Hon'ble Prime Minister envisions transforming the country into an upper-middle-income country by 2031 and a developed and prosperous nation by 2041. Her vision necessitates the integration of economic diplomacy as a central pillar within Bangladesh's foreign policy framework which is based on the philosophy of the Father of the Nation Bangabandhu Sheikh Mujibur Rahman "Friendship to All; Malice Towards None". The Ministry of Foreign Affairs has also defined five overarching targets, serving as the fundamental objectives of the economic diplomacy. These include securing equitable market access, diversification of exported goods and services, attracting substantial inflows of foreign direct investment (FDI), facilitating the transfer of critical technologies, and fostering improved employment opportunities for Bangladeshi professionals and workers in foreign countries.
In the post-COVID economic landscape, economic diplomacy emerges as a pivotal force that can shape evolving inter-state relationships. As global societies adapt to new norms in order to restructure their economic and production patterns, the importance of economic diplomacy cannot be overstated. Bangladesh recognises the significance of this dynamic shift and monitor and comprehend the prevailing global political, economic, technological, and legal scenarios, both within our own country and beyond, closely to chart a path forward in the right direction. Its necessity is so evident from the current regional and global geo-political realities, challenges, and opportunities faced by us. Therefore, effective navigation and overcoming differences in economic priorities among nations is critical for us to foster stronger social, economic, and political relationships. In this transformative process, diplomatic efforts can serve as the bedrock for cultivating connections, understanding complementarities, and facilitating mutually beneficial partnerships. Therefore, pursuing economic diplomacy in a planned manner with clear and defined objectives is critical to overall diplomatic maneuvers for our country and especially for the Ministry of Foreign Affairs.
Before coming to Canada, as per the existing practice introduced in 2019 by the current government, I had to present my vision in front of the Parliamentary Standing Committee on the Ministry of Foreign Affairs about my future work as High Commissioner in Canada. In terms of trade diplomacy, I assured the Committee that I would make sincere efforts to ensure that our exports to Canada double in value after my normal tenure as High Commissioner there, which is usually around 4 years. Today, I note that when I took charge as High Commissioner, our export to Canada was US$ 1.18 billion (end of 2020) and in two years time, it now stands at US$ 2.02 billion (end of 2022), an all time high and an increase of almost 72 per cent over two years, even though one of these two years (2021 and 2022) fell within the pandemic period, and Canada being the last country in the world to fully open after the pandemic. Most importantly, despite the pandemic and other challenges like Russia-Ukraine conflict, our exports to Canada continued to grow over the past years. I am also happy that after my joining the Mission, the Joint Working Group (JWG) to strengthen commercial relations between the two countries comprising four business leaders from each country, was formed in December 2021 and after a series of meetings, the JWG also submitted its recommendations to both the governments for their consideration to be discussed at the Foreign Office Consultation between the two countries. With consideration and implementation of some of these recommendations, trade and investment promotion between the two countries should be expanded and strengthened further.
Another important contribution of my Mission in promoting trade was our active involvement in the introduction of the operation of the direct Biman flight between Dhaka and Toronto. This has generated momentum in promoting mobility, people to people link and facilitation of trade and business connections. Once we have managed the fifth freedom traffic right for Biman and code sharing agreement with Air Canada and other airlines, our trade relations with Canada should be strengthened and enhanced further.
In terms of attracting Canadian investment to Bangladesh, the rate of our success is not up to satisfaction despite the Mission's efforts even amidst the lock-down due to the pandemic. In our view, the main reason for this low performance is lack of sincere efforts and pursuance to address some important issues that are critical to attract investment. One such important issue is the absence of Foreign Investment Protection Agreement (FIPA) between the two countries. Though discussion on concluding the FIPA between the two countries started in 2012, Bangladesh side was unable to propose a draft for it. It is worthwhile to note that in general, the Canadian investors are reluctant to go to a foreign country with which Canada has not concluded FIPA. On the issue of negotiating and concluding the FIPA, I found lack of initiative from concerned authorities in Bangladesh a key reason. Efforts in drafting the FIPA have been regretfully frustrating from our side. Once we have completed its draft, we can pursue with the Canadian authorities to conclude it as early as possible and once it is concluded, expectedly, it should facilitate and encourage the Canadian investors to explore investment opportunities in Bangladesh.
ECONOMIC DIPLOMACY IN THE CARIBBEAN: The main purpose of this write-up is to focus on exploring market for our exports in the Caribbean, which in my view, never got deserved attention as part of identifying non-traditional markets for our products. In addition to Canada, I am also concurrently accredited non-resident Ambassador to four more countries-- Trinidad and Tobago, Cuba, the Bahamas, and Nicaragua. Due to procedural formalities and other reasons, the Agrément from these countries took from one to two years to come through and I could complete all the formalities to be the accredited envoy to these countries only late last month. Therefore, it would take 1 to 2 years from now to explore export opportunities in these countries and place the necessary networks and operational arrangements to see our exports going to these markets.
As per our research, the overall export volume from Bangladesh to these four countries is meagre. As per the available statistics, this is just over USD 2 million per year in one of the four countries. There is no data available for other three countries. However, I did find some products from Bangladesh being retailed in these three countries that are procured through companies and brands located in third countries, mainly from the USA and Panama. I gathered this information during my visits to these countries and through my in-person visits to several big stores there. Taking full advantage of my visits to these countries connected with the presentation ceremony of my Credentials, I made efforts to identify, locate and meet several importers and big store owners and had lengthy conversations with them about direct sourcing from Bangladesh. I found that it is possible for Bangladesh to export directly to these countries. Meanwhile, we have already connected some of our sourcing companies especially from garments, leather, and jute industries, with the importers in these countries. Furthermore, we are connecting the business bodies of these countries with ours so that they could meet and work out a mechanism to start direct sourcing from Bangladesh. A trade delegation from Bangladesh is also scheduled to visit one of the four countries soon where there is a huge possibility for export of jute and jute products, along with garments and leather products. I have advised our business bodies to be associated with such delegation. Ministry of Commerce should also consider their inclusion in the delegation.
Given the travel restrictions in post-pandemic period and due to the current global conflict and economic meltdown, close cooperation, and coordination between the headquarters and the Mission is of paramount importance to pursue economic diplomacy in countries where we do not have resident Missions, like the Caribbean. If the concerned offices and officers in the capital both from public and private sectors and in the Missions abroad work together in a coordinated manner, considerable success can be achieved to enhance our exports to these unexplored new destinations. Our private sector needs to be encouraged and supported with adequate information to explore export opportunities in these countries by facilitating their mobility and helping them create business to business links. This Mission is currently engaged in the process of concluding Memorandum of Understanding to formalise the process of consultation and dialogue with a view to promoting and expanding business relations with these countries. We are also engaged with the concerned authorities in our government to consider concluding an Air Transport Agreement with some countries in the Caribbean along with code sharing arrangement between Bangladesh Biman and their national airlines for the Dhaka-Toronto and to-be-introduced Dhaka-New York routes to promote mobility, people to people and business to business links. I strongly feel that to diversify our exports to non-traditional markets, it is also important to have Honourary Consul in countries where we have no resident Missions. This is particularly important for countries with better prospects for our exports. To realise it, we are currently engaged in identifying suitable candidates preferably with successful business background, for appointment as Honourary Conuls in all the four countries where I am concurrently accredited as non-resident Ambassador. With their appointment, additional momentum would be generated as they would serve as bridge and facilitating advocates between our Mission and the concerned authorities of these four countries to promote business and other relations with Bangladesh.
In our estimate, if we try hard with adequate support from concerned authorities back home, it is possible that Bangladesh would be able to export directly to these countries to the tune of at least US$ 25 million in next two years as against the current recorded amount of around US$ 2 million. There is also some possibility of investment in our financial sector from one of these countries. We have already intimated our concerned authorities in this regard.
CHALLENGES AND OPPORTUNITIES: The importance of pursuing economic diplomacy cannot be overemphasised to make our country a developed one by 2041. We need to enhance and diversify our exports as much as possible by pursuing an effective economic diplomacy for this purpose. However, while the concerned Missions must explore all the existing opportunities in the host countries, it is important to have adequate and timely support, facilitation, and guidance from the concerned authorities in Dhaka to facilitate and support the work of the Missions. Regretfully, this is woefully inadequate and at times completely absent. This has been the biggest challenge for this Mission, and should be for any Bangladesh Mission abroad in pursuing specific targets of the overall objectives of our economic diplomacy. It is important to decentralise or delegate authority for decision-making based on policy and broader guidelines with necessary supervision, to working level officers to fast-track feedbacks and required decisions from the capital. The decision-making process must also be participatory where Missions' views should be asked for and included appropriately for making county-specific strategy as Missions know much better the ground reality of the host countries than the headquarters. Regretfully, on many occasions, Missions are not even informed, let alone consulted. The result is sometimes counter-productive and often goes against our interest.
Another important aspect of pursuing economic diplomacy in our view, is the selection of right kind of officers to deal with commercial issues in Missions. It has also been observed that officers selected and posted to Missions for such works have little or no knowledge in such issues and many of them are even shy of or reluctant to have required interactions with their counterparts in the host countries. This poses significant challenges for any Mission even for normal trade-related works, let alone explore new opportunities to pursue economic diplomacy. Until and unless the selection process is fair and based on required qualifications, needs and priorities, desired result cannot be achieved. Responsibility and accountability of any position and works thereof must be underscored, appreciated, and enforced.
While our efforts should continue to face the challenges of graduation in 2026 and extension of LDC Tariff beyond 2026 and possible discussion on concluding Free Trade Agreement with Canada, our concerned authorities are urged to expedite completion of the draft for FIPA to start discussion with the Canadian authorities for its finalisation. At the same time, we should also explore the mechanism under which Bangladesh can have some kind of business relation with CARICOM so that our products exported to one of the members of CARICOM, can also be retailed to other members.
In terms of export diversification, there are considerable market for our IT sector and jute products in Canada, in addition to existing products. We are working with concerned Canadian authorities like Trade Facilitation Office (TFO) and local business bodies to organise Single Country Fair of Bangladeshi products, focusing on jute. Collaboration and cooperation with our Ministry of Commerce, Export Promotion Bureau, SME Foundation, and individual exporters of jute and other products is critical to its success.
In this connection, it is worthwhile to note that the low rate of and unusually long delay in issuing Canadian visa has been quite a challenge for business promotion between Bangladesh and Canada. It has impeded the much needed mobility and business-to-business links between the two countries in a big way. This is particularly a big obstacle for our start-up businesses. Our concerned authorities and Canadian friends need to appreciate this important barrier to business promotion and cooperation between the two countries and should make sincere efforts to address it promptly. One remedy for this important barrier is the relocation of the Canadian Visa Centre
in Dhaka. It is to be noted that under the Canadian Indo-Specific Strategy, new Canadian Visa Centers have been proposed to be established or relocated in other countries in South Asia. Bangladesh meets all the criteria and along with its ever-growing economic prospects and better security situation, the long-pending issue of relocation of the Canadian visa centre in Dhaka should be resolved now. As a long-standing development partner of Canada,
Bangladesh deserves to be treated fairly without any bias and discrimination.
Dr. Khalilur Rahman, PhD is the High Commissioner of Bangladesh in Canada and non-resident Ambassador to Trinidad and Tobago; Cuba; the Bahamas and Nicaragua. [email protected]
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