EU-BD Trade : Environment, labour and social Issues are factors for future, CPD economist says
* Julia Alam
Internationally renowned trade economist, Professor Dr. Mustafizur Rahman said Bangladesh’s government and the stakeholders of trade would have to keenly follow the changing global market and trade regime, polarization among powerful trade partners and reshaping of geopolitics.
The country should also pay attention to policies of EU and specially it’s concerns about labor rights, environment protections and other social and political issues if Bangladesh wants to keep up markets in EU and expand more in the future.
“Trade with Europe in the future will not remain as easy as now because the EU are raising concerns about labor rights, environment protections and other social and political issues,” Mustafiz said during a long interview with Bangla Mirror on the occasion of the golden jubilee of independence of Bangladesh.
As of 2021, Bangladesh’s annual exports of goods worth about $44 billion, imports worth about $80 billion and inbound remittances worth nearly 22 billion-foreign trades equivalent to more than one-thirds of the country’s entire GDP.
Europe is the largest export-market for Bangladesh and provides zero duty market access. Moreover, the EU has already promised to continue this facility for three years even after Bangladesh’s formal graduation from the LDC list.
Bangladesh can get European Union as a supporter on multifarious issues in various global platforms like WTO and economic forums at the United Nation, said Mustafiz, who himself worked in collaboration with the European Commission, UNDP, UNCTAD, ADB and the World Bank.
His multidisciplinary analysis shows that the United States is still the world’s largest economic power and its market is so large that Bangladesh should search new and more avenues to increase exports there.
“The United States still has big influence in the global economy and, moreover it has an oceanic and geopolitical interest in the Bay of Bengal,’ says Mustafiz, a distinguished fellow at the Center for Policy Dialogue, the most prominent think-tank of the South Asian nation. He stressed on attracting US investments and continuing friendly relations with the country.
He analyzed different dynamics of Bangladesh’s trade relations also with India, China, Asia, with present and future perspectives and stressed on needs in change of policies in the changing circumstances.
About neighboring market, he said, Bangladesh imports a large quality of goods from India. Country’s second biggest import destination after China, sources around US$7 billion worth of consumers goods and industrial raw materials.
“The problem is that India imports about US$400 billion worth of goods and services, but compared to that, Bangladesh’s export to this giant neighboring market is negligible, he said” He wonders as it took 40 years after independence for Bangladesh to earn US$1 billion dollar a year by exporting goods to Indian market.
An expert at a government formed committee to study proposed BCIM (Bangladesh China India and Myanmar) Economic Corridor, Mustafiz said, “Utilizing BBIN (Bangladesh, Bhutan, India and Nepal) Motor Vehicle Agreement, multimodal cross-border connectivity and three-dimensional connectivity of investment-trade-communication, Bangladesh can exploit Indian market in large scale,”
Bangladesh’s exports huge quantities of readymade garments and few other categories of goods to remote markets in Europe and North America, this is not wise to keep huge opportunity in the nearby markets Asia unexplored, said Mustafiz, who taught for twenty-five years at the Faculty of Business Studies at the University of Dhaka, before joining as full-timer economist at the CPD.
He said, China is helping Bangladesh with industrial investments and infrastructure development supports in big scale market share of Bangladesh in huge market of China is very small. “China’s imports amount US$2,200 billion dollars whereas Bangladesh exports to that market is not even one billion!” He points out that China has given Bangladesh zero tariff facility on 97% of its products, so it is necessary to exploit Chinese market by increasing supply capacity.
The renowned economist reminds that after graduation from the LDCs’ list, the middle-income Bangladesh will not get privileged market access. “So, this is very important for Bangladesh to acquire efficiency and productivity-based competitiveness instead of market privilege dependent competitiveness and that is why regional markets, regional cooperation, bilateral and comprehensive economic partnerships should be integrated.”
He says preparation of Bangladesh for LDC graduation in the next 5 years is very important. “This is more important to think and make LDC graduation as a momentum for the further development of the economy of Bangladesh, said Mustafiz, who did one Masters in Economics from the Kharkov State University, Ukraine and Ph.D in Development Economics from Moscow State University.
He points out that position of the Bay of Bengal is a great asset for Bangladesh. “Bay of Bengal trade initiative has to be the big vision and mission for boosting foreign trade of Bangladesh and it should be the base of regional cooperation with India, China and ASEAN countries.”
In order to take advantages of the blue economy, Bangladesh now should make economic plans not only thinking the mainland but taking her nautical areas into account, said the professor, who had post-doctoral researches and fellowships at universities including The Oxford, Yale and Warwick
The writer is a Dhaka-based business journalist and tv host and she writes on foreign trade and economic affairsregularly. E-mail: [email protected]