Trade policy of Bangladesh will be reviewed in the World Trade Organisation (WTO) during the first half of the next year. It will be the fifth review. The fourth review took place in 2012. As a Least Developed Country (LDC) having a very small share in global trade, Bangladesh gets the maximum time gap for the review.
All member countries of the WTO, the multilateral trade rule-making body, are subject to review. The frequency of the review is, however, determined in accordance with their shares in global trade. The four largest shareholders - United States (US), European Union (EU), China and Japan - face the review in every two years. From the next year, the time gap for them will be three years and five years for the next 16 big shareholders in the global trade. Rest of the members will enjoy seven-year cycle with effect from the first day of 2019.
Under the Trade Policy Review Mechanism (TPRM), all members get an opportunity to figure out the trade-related policies and practices of their trading partners. It is, thus, a key transparency tool allowing members to better understand each other's trade policies, as well as ensuring compliance with their WTO obligations. A country under review has to provide information and brief explanation on its tariff and non-tariff measures, customs procedures, international trade agreements, import restrictions, export incentives, trade finance and some other tools. Partner countries can also place their queries on any economic, development and trade-related issues. This appraisal of their own trade and development policies helps invigorate the countries, particularly the developing ones. It is also a valuable instrument for small developing countries which often lack resources to monitor their trading partners adequately.
In Bangladesh, the Ministry of Commerce, along with the Ministry of Finance, is mainly responsible for formulating and implementing trade and investment policies. A large number of other ministries and agencies are also involved in the process. The country still doesn't have any combined trade policy document but there are separate export and import policies. As these polices (2015-18) have already expired, and the government is now in the process of finalising new policies for next three years (2018-2021).
Trade policy is not a fully independent policy in a sense that it requires support from investment policy. There is no independent investment policy. The investment policy is captured in export and import policies and mostly, in the industrial policy. Again, these policies are intertwined with fiscal and monitory polices. Thus, review of trade policy ultimately brings the overall economic policy under scanner.
Since the last trade policy review in 2012, Bangladesh economy has witnessed a rapid change in a number of areas. Growth rate of Gross Domestic Products (GDP) crossed 7.0 per cent level and continues to rise. Export earnings have increased from around $24.0 billion to $36.0 billion during the last six years while merchandise import also jumped to $54.0 from $34.0 billion. Trade in services has registered around 63 per cent growth. Some other developments are also there. All these will be reflected in the review.
The upcoming trade policy review will be the last review for Bangladesh as an LDC as the country is likely to label off the least developed nation tag by 2024. So, through the review, scheduled to be held on April 03-05 in 2019, trading-partner countries will try to gauge the direction of Bangladesh trade policy in the post-LDC era. This will be a new dimension for Bangladesh regarding the review of trade and investment policies.
Against this backdrop, Bangladesh needs to take adequate preparations for the review. As per the WTO guideline, the country itself has to deliver a policy statement while the WTO secretariat will prepare a country report. A team of WTO is due to visit Bangladesh next month to discuss with the policymakers, private sector representatives and experts on trade and economic development of the country. The team will collect necessary information from the government.
Later, WTO secretariat will prepare the country report on Bangladesh. Detailed chapters examining the trade policies and practices of the country and describing trade policymaking institutions and the macroeconomic situation will be there. The secretariat will also provide an independent assessment of the trade policy.
During a volatile period in global trade, the scheduled trade policy review also brings an opportunity to Bangladesh. Through the review, the country will be able to present its success and achievements in the last seven years. The statement should be realistic and temptation to make exaggerated claims should be checked.
The reviewers will look for the reform measures on economic liberalisation and ease of doing business. They may also tally the claimed initiatives and its reflection in different global indices like global competitiveness index. Non-tariff measure (NTM) is a critical thing and importers in the country are also facing NTMs like exporters. The issue will also get prominence. Besides trade in goods, trade in services will also come under review.
In the review meeting, representatives of Bangladesh will be required to answer questions raised by other members, especially the trading partners. Big countries like China, US and India are currently the big trading partners of Bangladesh. Though some questions will be sent beforehand and there will be one week's time to respond to the queries generated in the meeting. Answers to those questions will demonstrate the maturity of the country on multilateral trade regime.
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