SINGAPORE, Feb.22 (IPS) – Bangladeshis right now share a minimum of justifiable pride in the fact that the world deserves this country which deserves to be watched in terms of economic potential. In my opinion, we have come to this point for the following reasons: First, the effective use of early foreign aid; second, a steady, albeit sustained, evolution from a quasi-socialist economy towards an open and liberal economy; third, a shift from agriculture to manufacturing as land space has shrunk to accommodate urbanization; fourth, the release of a remarkable entrepreneurial spirit among captains of industry in the private sector, as evidenced by the ready-to-wear industry: fifth, the predominance of a vibrant civil society intellectually aiding social transformation by emphasizing emphasis on health, education and gender issues: and finally, a long period of political stability despite the traditional predilections of Bengali socio-political activism.
The philosophical basis of the concept of “least developed countries” (LDCs) developed at the UN in the 1960s was to identify a set of states whose obstacles to development were structural and not due to their own shortcomings. Hence the idea that the world trading system should be adjusted by granting these countries “special and differential treatment”, such as that implied by non-reciprocal preferential access to markets. We hope that would create a level playing field for them. Bangladesh joined the Group in 1975, immediately after joining the UN. The conditions for joining or leaving the list of LDCs are determined by the Development Policy Committee (CDP) on the basis of certain criteria. Of the first 48 countries, six have already graduated: Botswana, Cape Verde, Maldives, Samoa, Equatorial Guinea and Vanuatu. Nepal and Bangladesh are about to graduate.
Graduation for Bangladesh is a mixture of advantage and bane. It is a godsend because it is a recognition of progress, a major step in the development path of the country. This would improve the country’s overall image, which should give it better credit ratings. This would allow him to borrow more cheaply on the world market. It is a scourge because it would ultimately lose all preferences accorded to LDCs in world trade, such as under the European Union’s Everything But Arms (EBA) initiative. However, Bangladesh has not fully leveraged these benefits.
Incidentally, as Chairman of the Trade and Development Committee of the WTO, as well as the LDC Group in Geneva in the late 1990s and early 2000s, and also as Special Advisor to Secretary-General Rubens Ricupero of the United Nations Conference on Trade and Development (UNCTAD), I participated in related deliberations with the European Union. Bangladesh has always played a leading role on behalf of LDCs in all multilateral negotiations, both at the WTO in Geneva and at the United Nations in New York. Sometimes this involved not only difficult deliberations with developed countries and “ economies in transition ” (former socialist countries), but also with developing member states of the Group of 77 (because it involved sharing the pie) . the means deprive the LDCs of this capacity. In the diplomatic arena, Bangladesh could also depend on support from other LDCs on a wide range of issues. I would like to recall with gratitude the contribution in this regard of the so-called “Utstein Sisters” of Europe (named after a place in Northern Europe where they met), of five women ministers of development cooperation, including Evelyn Herfkens from the Netherlands and Claire Short from the UK. They were strong supporters of the aspirations of LDCs and played a key role in, inter alia, acceptance by the WTO, unlike its predecessor, the General Agreement on Trade and Tariffs (GATT), of the general principle that trade is development.
After graduation, Bangladesh will need to negotiate the continuation of international supportive measures to make the graduation process smooth and sustainable. If need be, even after the grace period of duty-free and quota-free market access to Europe until 2029. Although in Brussels, the EU could reduce somewhat Bangladesh due to its performance at the WTO Bangladesh will be well advised to attempt a standard setting exercise regarding outgoing countries with the new Director General Dr Ngozi Okonjo-Iweala who is empathetic , as well as with members. It will take skillful diplomacy. But I would like to stress strongly that the negotiations are only the tip of the iceberg. The main challenge would be to tackle the fundamentals below. For example, responding at the national level to the 27 requirements, including corruption, non-conformities and other shortcomings, across the spectrum of governance to achieve SPG-plus status. In addition, to reap other benefits from the global market.
Comparative advantages should be transformed into competitive advantage. Low wages will tend to perpetuate poverty. Raising wages, an essential tool for poverty alleviation, should therefore be carefully calibrated with increasing productivity. The economy needs to diversify, especially in services, which are not subject to tariffs on goods and therefore less affected by the loss of preferences. The internet sector, where the government is cautiously focusing on the laser, can help Bangladesh leap into economic modernity. The pharmaceutical industry should seriously consider how to navigate the WTO regulations on trade in intellectual property, or TRIPS. Mutually beneficial agreements with other Asian economic powers are needed. For example, a free trade agreement with a country like Singapore could, and I use the word “could” wisely, unleash potentials, but that would require further study and examination.
Throughout my career as a negotiator, I had felt that preferences only prolonged the pain. There are no friends in the market. The sooner we start to face the real world of competition, the better off we are. Indeed, if we can play our cards well, graduation could be our “burst” moment to think about reforms, increasing productivity and boosting growth. Efforts must aim to move up the value chain by attracting quality FDI. From my current perch in the corporate sector in Singapore, I see Vietnam as an example worthy of emulation.
So, to conclude, graduation is inevitable if progress is the goal, as it should be, and even desirable, just like, in our individual life, coming of age, i.e. being 21 years old. . Preparation is the key. From what I see, there is no such thing as the last minute to speed up the necessary preparations. There is definitely a lot of work to be done. But keep in mind that if there is a hill to climb, the wait will not reduce it!
Dr Iftekhar Ahmed Chowdhury is an honorary member of the Institute of South Asia Studies, NUS. He is a former Foreign Adviser (Minister of Foreign Affairs) of Bangladesh and President and Distinguished Fellow of the Cosmos Foundation. The opinions discussed in the article are his own. It can be reached at: [email protected]
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