Wednesday, May 01, 2024
The Centre for Policy Dialogue (CPD) has suggested Bangladesh to sign a Free Trade Agreement (FTA) with Japan to open up investment opportunities and provide greater market access.
The financial think-tank gave this suggestion during a dialogue titled “Bangladesh-Japan Partnership for the Next Development Journey” held in a city hotel on Wednesday.
In his welcoming speech, Ambassador of Japan to Bangladesh Ito Naoki said, “Around 68% of Japanese companies which are now in operation in Bangladesh are ready to expand their businesses. We, the Japanese government, have full confidence in expanding trade and investment in Bangladesh.
“However, Bangladesh should take initiatives to make doing business easier… In order to become a developed country by 2041, Bangladesh has to diversify the industry, adopt 4IR, and increase the amount of foreign investment. Japan will assist Bangladesh to mitigate those challenges.”
Meanwhile, according to a CPD report, Bangladesh will be treated as MFN (most favourite nation) after LDC graduation and face high tariffs in the Japanese market if no FTA or PTA (preferential trade agreement) is signed now.
As an LDC, Bangladesh is enjoying special preferential tariff which allows it to do duty-free quota-free (DFQF) trade with Japan for 97.9 per cent of its exported products - excluding fishery products, rice, sugar, and articles of leather.
Japan has also been providing Bangladesh with General System of Preference (GSP) for which lower tariffs are imposed in comparison to general tariffs.
In 2014, Bangladesh and Japan adopted the Comprehensive Economic Partnership Agreement (CEPA) initiative which emerged as a significant tool for bilateral trade and economic cooperation.
Japan is one of Bangladesh’s top trading partners, besides US and EU. Bangladesh’s RMG and textile exports started entering the Japanese market in 1972.
Japan has been a significant participant in the development journey of Bangladesh through consistent provision ODA to the country over several years. In 2021, Japan disbursed $1.95 billion as aid to Bangladesh, which was the highest in the past 50 years.
