Anu Mahmud :
The US Ambassador in Dhaka Marcia Bernicat responding to a question at a programme said, Bangladeshi exports will remain ‘competitive’ in the US market, especially the RMG export adopting the international standards on workers safety and rights, even it concludes TPP (Tran-Pacific Partnership) deal, “I fully expect Bangladesh is going to remain competitive, especially RMG (readymade garment) sector adopts international standards,” Bangladesh might one day qualify for the TPP “I think that’s an excellent topic for the upcoming TICFA? (Trade and Investment Cooperation Forum Agreement).”
The US has negotiated with Australia, Brunel Darussalam; Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam to sign TPP. The TPP is a comprehensive agreement that will open markets, set high-standard trade rules and address 21st-century issues in the global economy. In doing so, it’ll promote jobs and growth in the US and across the Asia Pacific region.
There is a perception that Bangladesh will lose its competitive edge in apparel trade under TPP deal. The US Ambassador said, “Once we have that deal, it’ll cover 40 per cent of the world trade and will help promote development and stability”. After finalisation, the TPP draft will go to the Congress. “Once our Congress ratifies it, then each country in order to subscribe TPP has to meet the number of conditions,” Bernicat said.
At present, Bangladesh pays 15.62 per cent duty for its garment exports to the US, whereas Vietnam pays 8.38 percent. After the signing of TPP garment exports from Vietnam will enter the American market completely without duty.
Bernicat, however, said there is good news and if Bangladesh can meet the same international standards, its economy can enjoy more robust trade in the US. “You’ll remain more competitive by adopting those standards.”
On GSP issue, she said there are areas of relationship that require more work. “I can think of no better example than the restoration of GSP The recent visit of the Assistant United States Trade Representative to assess progress on the Action Plan will help Bangladesh and its partners prepare for the upcoming Sustainability Compact review.”
Despite the GSP suspension, Bernicat said, US imports from Bangladesh has grown consistently as GSP only covers less than 1 per cent of total export.
Then US envoy said, she is optimistic about GSP restoration and mentioned that Bangladesh economy must expand into other areas.
Strong Benefits From TPP :
Spanning about two-fifths of the global economy, the hard-won deal aims to set the rules for 21st century trade and investment and press China, not among the 12, to shape its behavior in commerce, investment and business regulation to TPP standards.
Obama hailed the agreement as one that “strengthens our strategic relationships with our partners and allies in a region that will be vital to the 21st century:’ “When more than 95% of our potential customers live outside our borders, we can’t Jet countries like China write the rules of the global economy:’ Obama said in a statement.
In Canada, Prime Minister Stephen Harper praised the “historic” accord, saying it opens more access to the Japan market for Canadian farmers and resource sectors.
Australian Prime Minister Malcolm Turn- bull also said, it would deliver strong benefits for his country’s businesses.
And in New Zealand, where there was disappointment at not achieving more openings to the country’s prodigious dairy exports, Prime Minister John Key said, it nevertheless meant “more jobs, higher incomes and a better standard of living.”
Key Points of TPP:
The 12-country Pacific Trade Partnership, agreed in Atlanta, is a broad agreement to lower trade barriers and increase investment protections in a region comprising 40% of the global economy.
l It reduces overtime thousands of small and large tariff and non-tariff barriers on trade between the group, from Japanese auto parts to the US market, Australian drugs to Peru, US rice to Japan and New Zealand cheese to Canada. It also allows garment exporters like Vietnam to use yarn and other materials from outside the TPP and still benefit from TPP country tariffs.
l Countries must open state procurement more to foreign competition and not give state-owned enterprises undue preference. In some cases, including for Malaysia’s Bumiputera policies favoring ethnic Malay firms, this will be phased in overtime and only for companies and deals over certain sizes.
l The 12 countries agreed to resolve disputes with foreign investors before expert panels. While critics say this “investor-state dispute mechanism” will leave government vulnerable to frivolous lawsuits and extra-territorial laws, the TPP creates exceptions and barriers to frivolous lawsuits, according to negotiators.
l Establishes 5-to 8-year patent protections for cutting-edge biologic drugs, less than the 12-year US threshold but more than Australia’s five years. The range reflects failure to bridge some differences and the willingness to allow some countries room to harmonize domestic laws with the treaty.
l Sets standards for the cross-border issues of commerce and financial services, including preventing governments from forcing companies to place their data storage servers in the country or demanding access to a company’s software source code
l Requires countries to live up to labor rights and fairness standards of the International Labor Organization, and not to weaken labor protections to attract investment.
l Signatories are obliged to make strong efforts in environmental protection and not to undermine protections to boost trade and investment.
Trade deal for 21st century’
The accord involves significant market openings; tariff cuts on thousands of products, and pledges to protect investors across the 12 countries: Australia, Brunei, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, the United States and Vietnam,
Japan has made major concessions open its market wider to major food exporters such as Australia, New Zealand and the United States.
The United States agreed to lower its tariffs on Japanese car parts from non-TPP locations like China and Thailand, even though that will hurt TPP and NAFTA partners Mexico and Canada. Canada opens up to dairy products from New Zealand; both Australia and Canada get higher sugar quotas in the United States.
But more broadly, the agreement establishes mechanisms to handle disputes between foreign investors and governments; requires governments to not discriminate between their own state companies and foreign investors in major contracts; and demands countries like Vietnam, Mexico and Malaysia improve labor standards.
It also addresses new issues like data trade and intellectual property that have not been covered in multilateral trade pacts of the past.
Canada Trade Minister Ed Fast called the deal “truly transformational, saying: “The
magnitude and importance of rules for 21st century issues can’t be underscored enough.”
Ratification challenge
But as grueling as the negotiations in Atlanta, Georgia were, completed only the heavy lifting was not over for many of the TPP governments. They now must sell the pact to their people and parliaments for ratification, with many suspicious about a deal negotiated in intense secrecy and being delivered to them as an un-modifiable whole for an up-or-down vote.
That job that promises to be particularly difficult in Washington, where Congress already sounds hostile and its review will come during the election season next year.
From powerful Senator Orrin Hatch on the right and Senator Bernie Sanders, a presidential hopeful, on the left, President Obama was challenged to demonstrate US business and workers will not suffer.
Japanese Prime Minister Shinzo Aba hailed a deal to create the world, largest free trade area as the start of a ‘new century’- for Asia and hope China might one day join the historic accord. A huge economic Zone will emergence. The TPP will make out lives more prosperous. “The government must come clean now on what ugly compromises they have made behind closed doors :’ “The devil is definitely in the detail in these agreements.
Even in Malaysia, where securing passage should be easier, Trade Minister Mustapa Mohamed walked gingerly ahead of public review of the treaty, stressing it would not undermine the country’s Bumiputera policies to help native Malay-owned businesses.
“Malaysia would never be party to an agreement that violated the nation’s constitution or one that undermined the core policies instituted by the government to benefit the people:’
(The writer is an Economic analyst, Columnist, e-mail: [email protected])
