Govt finalises draft framework of FTA with Turkey

October 31, 2013

The government is going to start negotiations with Turkey soon for signing a free trade agreement with the country, commerce ministry officials said.
In this regard, the ministry on Wednesday finalised the draft framework of the agreement for carrying out negotiations with Turkey on the proposed FTA, they said.
Commerce secretary Mahbub Ahmed presided over the meeting held at the ministry’s conference room.
‘The government has decided to sign the FTA with the country mainly to keep unharmed Bangladeshi readymade garment export to the country which has been severely affected by imposition of 17 per cent safeguard duty by Ankara,’ a high official told New Age after the meeting.
Bangladesh has huge prospect in increasing RMG export to the country but it cannot reap the potential due to the safeguard duty on the products in entering Turkey, he said.
Usually, FTA signing countries allow duty-free market access to each other but any country can impose restrictions for specific products for specific period, he said.
Citing Turkey’s gazette notification on imposition of safeguard duty, he said that the duty would not be applicable for RMG products of the FTA signing countries, he said.
In July 2011, Turkey had imposed 17 per cent additional customs duty on imports of apparel products and 11 per cent on import of textile products from the least developed countries including Bangladesh for protecting its own garment industry.
The commerce ministry will send the draft framework to the foreign ministry for forwarding the draft to Turkey for their consideration, the officials said.
They said the Turkey government might take two to three months for scrutiny of the draft and they will approve it including their opinion, if any.
According to the draft, the agreement will facilitate and expand trade in goods, provide duty facilities and eliminate other regulatory restrictions in trade between the countries.
It will also facilitate trade in services and enhance cooperation in development of services sectors.
Both the countries will finalise the coverage of products for tariff elimination, how much tariff will be eliminated in the time when the agreement will come into force and how many products will enjoy the facility in the following years.
The countries will simplify customs procedures, exchange trade data, and extend technical cooperation and assistance related to trade facilitation.
The agreement will also deal with the promotion and expansion of investment and will create a liberal and competitive investment regime.
The Turkish government has repeatedly requested Bangladesh for starting negotiations on this issue although initially it was not interested in signing the FTA with Bangladesh referring to legal complexities with the European Union as the country is a member of EU Customs Union.
A high official of the commerce ministry said that Turkey had already sought permission from the EU for signing the FTA with Bangladesh and the ministry hoped that it (Turkey) would get the permission soon.
According the EU Customs Union, Turkey will align its commercial policy with the EU’s common commercial policy and cannot sign any FTA without approval of the EU.
According to the Export Promotion Bureau, Bangladesh’s total export earnings from Turkey fell by 24 per cent mainly due to a sharp fall in knit products export and stood at $551.9 million in the financial year 2011-12 against $724.5 million in the FY11.
In the FY12, export earnings from knit products decreased by 54 per cent to $124 million from $272 million in the previous year.
RMG and textile account for over 80 per cent of the Bangladesh’s total export to Turkey.
The bilateral trade between the two countries is in favour of Bangladesh. Bangladesh exported products worth $638 million to Turkey against its import of $214 million in 2012.

-With New Age input

Advertisement Area

Comments

Got something to say?

You must be logged in to post a comment.