Govt keen on services in FTA with Malaysia
Bangladesh will sign a Free Trade Agreement (FTA) if Malaysia agrees to include the services sector in the deal, said a senior official of Bangladesh Tariff Commission (BTC) yesterday.
In an exchange of documents with the South-East Asian country in August, Malaysia did not show an interest in including the services sector in the deal, although Bangladesh's main interest in signing the FTA was to include it.
Bangladesh is interested in including 'MODE 4' in the agreement as the country's export basket is limited to apparel only, said the official requesting anonymity. Mode 4 refers to the presence of persons of one World Trade Organisation (WTO) member in the territory of another for the purpose of providing a service.
It does not concern persons seeking access to the employment market in the host member, nor does it affect measures regarding citizenship, residence or employment on a permanent basis.
Moreover, the balance of bilateral trade is heavily in favour of Malaysia, as Bangladesh imports many consumable items like palm oil, he said.
If the services sector is not included in the agreement, the trade balance will go further in favour of Malaysia, the official said, adding that Bangladesh is approaching the deal in a win-win spirit.
“We have already asked the Malaysian government to include the services sector in the agreement,” he said.
On the basis of a study conducted by BTC, National Board of Revenue (NBR) has been assigned to scrutinise different duty structures to prepare the documents for the government so that the FTA can be signed, the official said.
Earlier, BTC submitted a report on the deal to the commerce ministry in May on the basis of FTA guidelines prepared last year, he said.
Upon receiving suggestions from NBR, the commerce ministry will hold meetings with different stakeholders like chambers and trade body leaders for their opinions.
The recommendations from stakeholders will be compiled and the commerce ministry will send the documents to the Prime Minister's Office for approval, the official said.
Under two-way trade, Bangladesh exported goods worth $29.84 million to Malaysia in fiscal 2010-11 (July-March) and imported goods worth $1.23 billion at the same time, said data from the commerce ministry.
In fiscal 2009-10, Bangladesh exported goods worth $62 million and imported goods worth $1.23 billion, data showed.
Currently, Bangladesh gets a duty-waiver facility on the export of 497 products as Malaysia added 300 garment items in the duty-free list on October 15 last year.
A senior commerce ministry official said the country is also conducting a study on signing an FTA with India, but the process is still in its primary stages.
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