Bangladesh is preparing to join the Regional Comprehensive Economic Partnership (RCEP) for tariff-free facilities. It plans to join the world’s largest trading bloc to qualify for tax-free benefits in a third of global markets after graduating from a developing country in 2026, sources at the Ministry of Commerce said.
In this regard, the Ministry of Commerce has already prepared a proposal for membership of the organization which will be formally sent to RCEP headquarters very soon.
About a month ago, Bangladesh decided to join RCEP, sources said.
According to sources, Bangladesh’s exports to the RCEP countries won’t be until 2026, when the country’s duty-free access to these two major markets will end.
Bangladesh also currently has duty-free facilities in New Zealand and Australia. But after graduation from MOL, such benefits will no longer be available in these two countries.
If Bangladesh does not join RCEP by 2026 or sign free trade agreements with those countries separately, it will lose its competitive advantage in clothing exports, especially to China and Japan. While Bangladesh’s counterpart, Vietnam, as a signatory to RCEP, will enjoy tax-free benefits after the agreement comes into effect.
In this regard, an official from the Ministry of Commerce said that the proposal to join the RCEP is not clear. The proposal should be clearer. We have already held talks with the Ministry of Foreign Affairs to discuss joining this alliance.
We have until 2023 to join the world’s largest trading bloc. There is an opportunity to learn more about the case.
He said membership in the commercial bloc requires lengthy research as it is a large market where trade benefits are available. But at the same time, we must keep an eye on the protection of the local industry. He said the Bangladesh Tariff Commission is now working on this issue.
November 15, 2020 15 countries – China, Japan, South Korea, Australia and New Zealand; The 10 members of the Association of Southeast Asian Nations (ASEAN): Brunei, Vietnam, Laos, Cambodia, Thailand, Myanmar, Malaysia, Singapore, Indonesia and the Philippines – signed the world’s largest free trade agreement, covering 2.2 million billion people. The combined GDP is $26.2 trillion.
The agreement aims to lower tariffs, open trade in services and boost investment to help emerging economies catch up with the rest of the world. In particular, RCEP is expected to help reduce costs and time for businesses by allowing them to export goods anywhere within the bloc without having to meet individual requirements for each country.
After approval by three-fifths of the 15 signatory countries – six ASEAN countries and three non-ASEAN countries – in their respective parliaments, the RCEP agreement will enter into force within 60 days.
Japan, Singapore and Thailand have already ratified the UNCEP treaty. The commercial alliance plans to launch in January next year.
The idea for the UNECP was born in 2012 and gained momentum in 2017 when the US withdrew from the Trans-Pacific Partnership (TPP), later renamed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
Leaders of 16 countries concluded RCEP talks in Bangkok in November 2019 with India on board.
Member States were expected to formally sign the agreement in 2020. He later withdrew citing unresolved issues.