Beruflich Dokumente
Kultur Dokumente
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VOL 22 NO 248 REGD NO DA 1589 | Dhaka, Saturday, July 25 2015
Bangladesh has, however, signed the Trade and Investment Framework Agreement (TIFA). It is a bilateral agreement between the
US and another country. In principle, TIFA allows for treaties that are more responsive to the partners' needs and tailor-made to
their situation. A TIFA between Bangladesh and the USA was drafted in 2005 but it was never brought to completion. The TIFA
2005 stressed the need to "encourage and facilitate the exchange of goods and services and to secure favourable conditions for
long-term development and diversification of trade between the two countries." A next step from there could be negotiating a
bilateral free trade agreement between Bangladesh and the US.
The existing negative US-Bangladesh trade balance and the limited presence of American investors make the country less
significant economic partner from American point of view. Reputational issues in terms of social compliance also affect
negatively Bangladesh's export potential. The US policy makers consider the RMG sector as harbouring unethical manufacturing
conditions. The USA also expects Bangladesh to take a favourable role in WTO negotiation on trade liberalisation and NonAgricultural Market Access (NAMA) negotiations.
Bangladesh should initiate lobbying for actively pursuing a US-Bangladesh bilateral agreement, improving the RMG's social
compliance record and investing in backward linkages and, above all, political-level consensus on certain issues and, of course,
certainty and speed of delivery.
A country, especially the USA, does not enter into a free-trade agreement without a lengthy period of careful study, scrutiny and
intense negotiations with both domestic stakeholders and partner countries.
As interim measure, Bangladesh may improve compliance, take a initiative to take protection of the Competition Act and
coordination and close relation with the US lawmakers and the Washington administration to get favourable terms of trade.
Bangladesh may ask for protection from monopsony from small US buyers and too many exporters in Bangladesh leading to
control over price and market by the retailers. Garment exporting countries like Bangladesh are advised to concentrate on other
ways of gaining share of the lucrative US markets.
Bangladesh may follow the Chinese strategy of enhancing productivity and manufacturing high value-added products to increase
its market share in the US.
After the Rana Plaza collapse, 175 export-oriented small and medium garment factories were closed and many improved the
factory conditions but compliance in Bangladesh is not enough. There are other many issues like labour rights and workplace
safety, minimum wages and other social issues to address as per requirement of buyers. Bangladesh can take short-term measures
to increase export and go for long-term negotiation for free trade agreement with the USA.