Ticfa raises mixed reactions
The government's decision to sign the Trade and Investment Cooperation Forum Agreement (Ticfa) with the US attracted mixed responses from economists, trade experts and businessmen.
Yesterday's move, tipped to enhance commercial ties with the superpower, comes less than two weeks before the verdict from the United States Trade Representative over continuation of the country's Generalised System of Preferences is due.
"It is a timely move. It provides a positive signal to the US administration," said Ahsan H Mansur, executive director of Policy Research Institute (PRI).
Although the GSP issue is not related with the Ticfa, it is diplomatically related. “It will unofficially help Bangladesh retain GSP privilege.”
Mansur, a former official of the International Monetary Fund, said a broad framework such as this to deal with bilateral trade and investment issues was necessary.
"I do not find anything negative in going ahead with it," he said, adding that all South Asian nations bar Bhutan have such bilateral agreements with the US. "Even the Vietnam that had fought with the US for two decades has such a contract.”
He said the platform provided by the treaty will allow the problems raised by businesses to be addressed formally.
Furthermore, it will help Bangladesh get more US investments. "But it is not a sufficient condition -- rather, a helpful condition."
Toufiq Ali, former ambassador of Bangladesh to World Trade Organisation (WTO) in Geneva, said the waiver from intellectual property protection that Bangladesh currently enjoys as a least-developed country (LDC) under WTO conventions should be compromised by Ticfa.
“All countries that are now developed did not provide intellectual property protection in the early stages of their development. It is unfortunate if our development prospects are now to be held back by implementing the IP protection.”
Ali said it is doubtful how much the Ticfa would help in obtaining duty-free access to the US market.
“The final decision on duty-free access will be taken by the US Congress and I do not believe that the US administration would take up this issue with the US Congress now.”
“The US government is involved in many more pressing matters with the US Congress and getting duty-free access for Bangladesh will be very low in their order of priority. However, I hope for the sake of our readymade garments exports that I am wrong."
Imtiaz Ahmed, a professor of international relations at Dhaka University, thinks that the US may attach some difficult conditions even if it reconsiders its stance on continuation of GSP facility.
“President Barack Obama's decision on the GSP facilities is due by June 30 and the nod on Ticfa might be the last ditch effort by the current government to secure the facilities.”
“The government is already in a weak position in the eye of the global community due to internal political turmoil and its ideological stance regarding Grameen Bank,” he said, adding that the Ticfa might not be enough to improve that image.
However, even if Ticfa is signed in this tenure of the government, the full potential might not be realised within the short span of time.
“The success of the agreement depends on the diplomatic competence and strong negotiations from the people concerned. With the general elections looming, this move might be perceived by the people of the country as a way to retain vote banks.”
However, Salehuddin Ahmed, former governor of Bangladesh Bank, is sceptical over the bilateral deal.
"Multilateral agreements are better than such bilateral agreements for LDCs like Bangladesh. I would say, Bangladesh has agreed to sign it under pressure."
He, too, thinks that the country would not do well in bargaining with its US counterpart because of “weak negotiation capacities and skills” of its officials.
On adequate and effective protection and enforcement of intellectual property rights issue, Ahmed said: "If the US wants to mediate it through Ticfa, it will be problematic for Bangladesh. Prices of many products will rise."
Nazneen Ahmed, senior research fellow of Bangladesh Institute of Development Studies, said the signing of the agreement will provide another platform for Bangladesh other than the WTO.
"Bangladesh can also raise its demands for duty-free and quota-free market access for its products to the US market. Our products are facing various types of taxes in the USA. We also raise these issues at the forum.”
Kazi Akram Uddin Ahmed, president of the Federation of Bangladesh Chambers of Commerce and Industry (FBCCI), said the Ticfa will increase trade with the US.
“I now hope the US will not scrap the GSP benefit for Bangladesh. We are waiting for a positive signal from the US.”
Manzur Ahmed, adviser to the FBCCI, said it is too late to sign the Ticfa with the US. “We would have signed it a lot earlier -- there is no room for argument.”
Sabur Khan, president of Dhaka Chamber of Com-merce and Industry, echoed the views of the FBCCI president.
Atiqul Islam, president of Bangladesh Garment Manufacturers and Exporters Association, the garment makers' platform, also welcomed the move, saying the agreement would help towards the retention of GSP.