Bilateral negotiations and improved business climate will help Bangladesh deal with adversities during its transition to a developing nation from a least developed country, experts said yesterday.
After graduating from the LDC category in 2024, the country could face several challenges, such as a lack of preferential access to international markets.
"Graduating from the LDC category will simultaneously provide a lot of opportunities and challenges for Bangladesh," said Salman F Rahman, private industry and investment adviser to the prime minister.
"Now, Bangladesh is preparing for what is to come," he said.
He was addressing a webinar styled, "LDC Graduation by 2024 and readiness of Bangladesh', jointly organised by the International Business Forum of Bangladesh (IBFB) and the Bangladesh Enterprise Institute (BEI).
Some have alleged that the government has done next to nothing to prepare the country for the post-graduation period.
However, this is untrue as the authorities are already working on solutions for potential problems and are developing strategies to secure opportunities, Rahman said.
"Serious negotiations with the World Trade Organisation are taking place to address possible threats to the economy during the transition period."
Even after the graduation, there is a scope for Bangladesh to enjoy trade benefits under the Generalised System of Preferences (GSP) Plus scheme, Rahman added.
The GSP Plus facility is a special component of the GSP scheme that provides additional trade incentives to developing countries already benefitting from the preferential treatment.
Rahman acknowledged that the cost of doing of business is the highest in Bangladesh.
Ever since becoming an adviser to the prime minister, he has tried to improve the country's ranking on the World Bank's Ease of Doing Business Index.
"We have to come out from the old and traditional mindset to take benefit like tax exemption from the government. We have to pay taxes and duties to do business and face the challenges," he said, adding that he is confident that Bangladesh will be strong enough to face the adversities involving the graduation.
Md Hafizur Rahman, director-general of the WTO cell of the commerce ministry, said negotiations are ongoing with various countries on attaining trade benefits after the graduation.
"We are working to sign a preferential trade agreement with Nepal within December and then with Japan," he said, highlighting the need for capacity-building in the private sector.
Bangladesh only has four years in hand before graduating from the LDC category, said Prof Mustafizur Rahman, a distinguished fellow of the Centre for Policy Dialogue.
Securing GSP Plus status will be crucial for Bangladesh. As only five other countries are up for graduation, it will be easier to negotiate a deal in this regard, he said.
"We should explore preferential trade agreements that are mutually beneficial to face future challenges," Rahman said.
"There will be many windows of opportunity after graduation and the country needs to do its homework to secure those benefits."
Monzur Hossain, a research director at the Bangladesh Institute of Development Studies, said revenue in the export-oriented industries could fall after the graduation. However, the government is preparing for these challenges.
"Even if the graduation is deferred by another 10 years, the challenges to export, including garments, will not go. So, it is better to prepare to confront the issues during the transition period," Hossain added.
Anwar-ul Alam Chowdhury, a former president of the Bangladesh Garment Manufacturers and Exporters Association, said addressing Bangladesh's lack of competitiveness in the global market should be the priority.
He said that the private sector's production capacity and capability should be increased. "We need modern and innovative technologies to face the challenges post-graduation."
Syed Nasim Manzur, a former president of the Metropolitan Chamber of Commerce and Industry, said there is no alternative to securing duty-free access to international markets even after the graduation.
According to him, doing business in Bangladesh is costly as the transportation cost is among the highest in the world.
The entrepreneur stressed the importance for dedicated economic negotiations post-graduation to address potential challenges. "Any loss of trade benefits will not only affect the garment sector but also all other export-oriented industries," Manzur said.
The event, moderated by IBFB President Humayun Rashid, was also addressed by Farooq Sobhan, a distinguished fellow of the BEI, Md Fazlul Hoque, a former president of the Bangladesh Knitwear Manufacturers and Exporters Association, and MS Siddiqui, a vice-president of the IBFB.