GSP perk to go as Dhaka drags foot

As Bangladesh has not implemented the Saarc Cumulation yet, it is still uncertain whether Bangladesh would be able to avail of the Super Regional Cumulation (SRC) facilities that of the European Union offers under its Generalised System of Preferences (GSP), commerce ministry officials said yesterday.

"The EU offered us the Saarc Cumulation, but we could not avail it. They have offered the SRC covering both the Saarc and the Asean (Association of Southeast Asian Nations). It means, they will accept goods if raw materials are imported from the Asean countries, too," a commerce ministry official said yesterday.

The recent guidelines issued by the European Commission on the GSP scheme for the 10-year period (2006-2015) encourage regional cooperation as a means for achieving greater improvement, benefit and utilisation of the GSP rules of origin by southern countries.

Sri Lanka has already prepared a concept paper on the SRC and is pursuing it to be included in the Saarc (South Asia Association for Regional Cooperation).

Earlier, a Saarc standing committee requested its member states to send their views to the Secretariat so that at the 12th meeting of the Committee on Economic Cooperation (CEC) held in Islamabad on November 20 and 21 could consider the SRC. But Bangladesh representative to the meeting sought more time to review the proposal with its private sector.

"In fact, we are facing serious trouble in keeping pace with the ongoing negotiations for the South Asian Free Trade Agreement (Safta) and the BIMST-EC (Bangladesh-India-Myanmar-Sri Lanka-Thailand Economic Cooperation, which also has co-opted Bhutan and Nepal) due to lack of adequate trade negotiators," said the ministry official.

"Besides, there is very little time left to meet the deadlines for implementing the Safta, which becomes effective from January 1, 2006, and the BIMST-EC from July 1, 2006," he added.

The Saarc Council of Ministers at a meeting in January in Islamabad took a decision that the Saarc should examine the question of expanding the facilities of regional cumulation into an arrangement of SRC covering both the Saarc and the Asean offered by the EU.

The decision of the council followed a meeting of the Saarc Foreign Ministers in New York on the sidelines of the United Nations General Assembly (UNGA) in September 2003. The decision was taken in the context of the adverse effects apprehended in the apparel industry due to phasing out of textile quotas under the Agreement on Textiles and Clothing (ATC) by January 2005.