US to explore new opportunities with Bangladesh under TICFA as GSP review goes on

The United States wants to focus on expanding economic relations with Bangladesh outside the context of GSP as Dhaka remains relentless in demanding the privilege back.

The latest demand to restore the GSP after the second TICFA meeting in Washington came from Commerce Minister Tofail Ahmed.

Ahead of the Monday meeting, the US embassy’s deputy chief of mission David Meale said “much has been done so far but some items remain to complete GSP Action Plan” to get back the privilege as stated by the Assistant Trade Representative Michael Delaney in September.

Delaney made the comment during his September visit on the heels of the government’s claim that it had fulfilled the 16-point action plan Washington rolled out two years back after the GSP suspension.

Freedom of association, greater transparency with respect to unfair labour practices, and union registration both outsides and inside the EPZs are some of the areas, he had said, where improvements must be made in order to fulfil the action plan.

“We need to complete this process as we work together to restore the GSP,” Meale told a group of journalists.

GSP is “not everything” between the Dhaka-Washington trade and investment, he said, as the commerce minister recently said TICFA is meaningless if the GSP is not restored.

Meale said TICFA had created “a good platform” for more bilateral trade and investment opportunities between the countries.

The Trade and Investment Cooperation Forum Agreement (TICFA) was signed in November 2013.

It provides a platform for both governments to discuss mutual interests in trade, to raise concerns, and to resolve them.

“TICFA is more than GSP. It covers everything. We did not create TICFA for one issue,” he said.

“TICFA is about expanding the potential of our bilateral trade and investment relationship.  It's important to note that GSP itself applies to less than 1 percent of our two-way trade,” Meale said.

He said the GSP review process had only started with the visit of the trade team in September.

But he said the suspension did not create an impact on Bangladesh's main export item, readymade garments.

The garment items had never enjoyed the privilege.

According to the Export Promotion Bureau, Bangladesh exported $1.81 billion garment items to the US market from July to October, 17.58 percent more year-on-year.

Last fiscal, Bangladesh exported $5.29 billion of clothing products to the US which was 2.85 percent more than the previous fiscal.

Meale said Bangladesh has the potential to expand exports to the US in many sectors, particularly pharmaceuticals and IT products and services.

He said US companies were also interested in building relations and investing in the energy and infrastructure sectors.

He said, the GSP Action Plan “standards are not unlike some of the standards found in TPP.”

The TPP is a trade agreement among twelve Pacific Rim countries concerning a variety of matters of economic policy.

The deputy chief of mission said that if "Bangladesh decides it is willing to meet the overall TPP standards, it might one day wish to signal interest in joining."

The suspension of GSP and a discussion of what steps had been taken under the Action Plan were a primary focus of the first TICFA meeting held last year in Dhaka.