Bangladesh’s competitiveness after LDC graduation will largely depend on a shift from trade preference to skills and productivity driven competitiveness.
Private think tank Centre for Policy Dialogue (CPD) made the suggestions at a dialogue on Thursday, prior to upcoming 12th World Trade Organization Ministerial Conference (WTO-MC12).
“The key is to prioritise the domestic homework in areas of reforms, strengthening of institutions, infrastructure and capacity building, technological transformation and skills enhancement and human capacity building,” he added.
He explained that the steps would be required to ensure transition from preference-driven competitiveness to skills and productivity-driven competitiveness.
“What the country does today will determine whether its graduation will be smooth, with momentum, and is sustainable and irreversible,” Prof Mustafizur stated.
CPD has urged the government to pursue strategic trade and investment policies to ensure a sustainable LDC graduation.
Its recommendations also include: Ensuring triangulation of trade, investment, and transport connectivities with proper logistics and trade facilitation towards strengthening development of regional value chains and production networks, to take advantage of the "Asian Century."
Negotiation with trading partners on that matter to get into CEPA type RTAs, to attract efficiency-seeking FDI, targeting the regional markets will also be important.
However, Bangladesh Garment Manufacturers and Exporters Association (BGMEA) President Faruque Hassan acknowledged that trade competitiveness is going to be crucial in the upcoming days, especially for the graduating LDCs like Bangladesh.
“We have to make use of support programmes like UNCDF, LDCF, UN technology bank for LDCs etc. We need to make most use of these options,” he said. However, he sought extension of the LDC transition period for 12 more years to sustain the growth momentum and build internal capacity.
Laying emphasis on Free Trade Agreement (FTA) BGMEA president said, “While we keep engaging through multilateral trade system, given the rise in regional and bilateral FTAs, it will be very difficult for Bangladesh to cope up with competitors if we cannot make our ways through to that direction.”
Along with exploring potential and emerging markets, in the upcoming days, Bangladesh will have to focus on intra-regional trade block, he added.
The BGMEA President also stressed the need for capacity building for trade negotiation. “We have to work on our internal capacity building as far as trade negotiation and economic diplomacy is concerned.”
CPD Chairman Professor Rehman Sobhan chaired the virtual dialogue titled "Upcoming MC12: Bangladesh's Expectations and Possible Stance," moderated by its treasurer Syed Manzur Elahi
Md Hafizur Rahman, Director General, WTO Cell, ministry of commerce, Dr. Nazneen Ahmed, Country Economist, UNDP, Dr Mostafa Abid Khan, former member, Bangladesh Trade and Tariff Commission, and Dr. Khondaker Golam Moazzem, research director, CPD, attended as panelists. FES Bangladesh Office Programme Coordinator Shadhan Kumar Das delivered the welcome remarks.