Media report said commerce minister Tipu Munshi on Thursday stressed the need for signing Free Trade Agreement (FTA) with Malaysia in order to boost trade, commerce and investment from two sides. Here we need to mention that Bangladesh has a long-standing trade and economic relationship with Malaysia and signing of a FTA would invariably boost trade and investment on both sides. We understand that discussion on signing FTA between the two countries have progressed a lot and it will be possible to sign it if Malaysia comes forward. Technical issues were largely been sorted out, political decision is important at this stage to materialize it.
Bangladesh is planning to sign a number of FTA and preferential trade agreement (PTA) with South Asian countries and trade blocks such as ASEAN as we are moving to join the developing country status soon. As an LDC we are enjoying duty free market access with European countries and many others for duty free export or at concessional duty but we would lose it once we will join the developing country status. So signing FTA or PTA is becoming increasingly important to stay competitive with existing business partners or regional countries.
Signing it with Malaysia make more sense as our trade volume is big with Malaysia as a fat growing trading partner. We need to export more at a time out export was only worth $306.57 million to Malaysia last year while we imported five time big at $1,576.89 million worth of goods and services. The major Bangladeshi exportable items to Malaysia include RMG, jute-made goods, light engineering and leather products while we import palm oil, furniture, chocolates and fruits. We would say signing a FTA Malaysia would benefit tremendously while palm oil import alone is costly and become less expensive for us under PTA.
So we would suggest relocation of palm oil plant and such other industries here is sensible. Any FTA is likely to be highly rewarding on both sides. So both countries should make political decision at this stage to move one step forward to open trade and investment under FTA or any such arrangement.
