The thirteenth Ministerial Conference (MC13) of the World Trade Organization (WTO) convened in Abu Dhabi, UAE, from February 26 to March 1, 2024. The outcomes of MC13 helped to outline the attendant tasks for Bangladesh as it transitions from a Least Developed Country (LDC) to a developing nation. This transition necessitates Bangladesh to balance on three fronts — maintaining its status as an LDC, navigating its journey as a graduating LDC, and preparing for its future as a developing country. While the WTO does not officially recognise a category for “graduating LDCs”, Bangladesh, alongside other nations in similar transitions, must collaborate closely with the broader LDC group. This solidarity ensures that the unique challenges and opportunities faced by transitioning economies are effectively addressed.
Bangladesh has distinct interests as a graduating LDC, particularly concerning the extension of time-bound LDC-specific measures and the implementation of new support mechanisms tailored to sustainable graduation. As a pivotal member within the LDC group, Bangladesh is poised to lead the efforts to address the needs and aspirations of graduating LDCs. This entails taking proactive steps to advocate for these interests, both within the LDC group and in collaboration with developing and developed WTO members alike.
In this context, the Centre for Policy Dialogue (CPD), in partnership with Friedrich-Ebert-Stiftung (FES), organised a dialogue titled “What did WTO-MC13 Deliver for the Graduating LDCs? Perspectives from Bangladesh” on Monday, 11 March 2024, at Centre on Integrated Rural Development for Asia and the Pacific (CIRDAP).
Dr Fahmida Khatun, Executive Director, CPD, chaired the session and highlighted ‘Bangladesh has strategic interests across various areas. A critical aspect is Bangladesh’s status as an LDC, affording us preferential access to both developed and developing countries’ markets at Duty-Free Quota-Free (DFQF) rates. However, alongside leveraging these advantages, we must prioritise strengthening our domestic taxation system and enhancing institutional capacity.’
In his introductory remarks, Mr Richard Kaniweski, Interim Resident Representative, FES, Bangladesh, said ‘Bangladesh’s transition from an LDC presents distinct opportunities and challenges, demanding strategic planning, infrastructure investment, and supportive policies for sustainable societal growth and prosperity’.
‘As Bangladesh evolves into a developing country, it must actively participate in upcoming Geneva negotiations leading to MC14 in Cameroon and approach these discussions through the perspectives of a graduating LDC and a future developing nation’ suggested Professor Mustafizur Rahman, Distinguished Fellow, CPD, during his keynote presentation.
Remaining elements of the LDC graduation proposal include Bangladesh’s active interest in pursuing Annex 2 proposals in future negotiations such as the extension of Trade-Related Aspects of Intellectual Property Rights (TRIPS) Transition Period, continuation of export subsidies for non-agricultural products, and frequency of notification obligations. Inclusion in the Net Food Importing Developing Countries (NFIDC) list will require an application supported by evidence. Concerns regarding fisheries subsidies should be addressed, including the raising of de-minimis. Reforms within the WTO and the Dispute Settlement Mechanism should prioritise securing development dimensions of the multilateral trading system.
While discussing the agriculture reforms, Professor Rahman underscored ‘Bangladesh’s agricultural subsidies are below the 10 per cent de-minimis threshold, but support for the PSH proposal is warranted. In the realm of E-Commerce, Bangladesh’s offensive interests outweigh its defensive ones, necessitating continued engagement in Geneva discussions.
Implementation of Special and Differential Treatments (S&DT) Provisions for Developing Countries is crucial, considering that out of the 183 S&DTs under 16 major WTO agreements, 25 are LDC-specific, while the rest pertain to the interests and concerns of developing country members of the WTO.
‘A decision must be made on whether Bangladesh will participate in plurilateral initiatives, considering the advantages of embedding graduating LDC concerns and having a say in proposed rules, regulations, and disciplines’, said the Distinguished Fellow. Pursuing bilateral Free Trade Agreements (FTAs) and Comprehensive Economic Partnership Agreements (CEPAs) is essential to safeguard trade interests and address issues of competitiveness erosion. However, this will necessitate full or partial reciprocity.
He further elaborated that signing bilateral trade agreements will require reforms, institutional strengthening, human resource capacity building, and measures to translate comparative advantages into competitive advantages. Regional cooperation, production networks, and regional value chains should also be emphasised.
Additionally, he highlighted that vigorous bilateral discussions with preference-providing countries like Canada, Japan, South Korea, India, and China are necessary, extending beyond receiving preferences for an additional period of three years. Adequate preparation is required in light of GSP plus concerns, including EU GSP import ceilings, rules of origin, and obligations concerning labour rights, CO2 emissions, environmental standards, gender inclusivity, good governance, and others.
The Chief Guest of the dialogue, Mr Ahasanul Islam (Titu), MP, Hon’ble State Minister, Ministry of Commerce, Government of Bangladesh, suggested ‘As a graduating LDC country, it is crucial for Bangladesh to understand the direction in which global trade and commerce are heading’. He added that negotiation is a skill we need to hone, not just for WTO but also for our Free Trade Agreements (FTAs), Preferential Trade Agreements(PTAs), and other economic agreements.
Mr Tapan Kanti Ghosh, Senior Secretary, Ministry of Commerce, Government of Bangladesh, highlighted ‘Bangladesh needs to prioritise competitiveness, skills development, productivity enhancement, and product diversification’. He underscored the importance of implementing crucial reforms to attain these objectives.
‘One area we should focus on is participating in plurilateral discussions on trade facilitation for development. It’s an area we must actively engage in and promote to attract Foreign Direct Investment (FDI)’ underscored Ms Ferdaus Ara Begum, Chief Executive Officer, Business Initiative Leading Development (BUILD).
Dr Debapriya Bhattacharya, Distinguished Fellow, CPD and Former Ambassador and Permanent Representative of Bangladesh to the WTO and UN Offices in Geneva, said that over 30 years, the WTO has faced pressure from competing countries and major trading nations. The hope was that with China’s accession, tensions could be internalised, but unilateral measures persisted, undermining the rules-based system. Reform is imperative, especially considering the WTO’s dispute settlement mechanism, which has remained inactive due to a lack of appellate body judges for five years.
High-level policy makers, trade specialists, business leaders, academics, development practitioners, civil society activists, international development partners and journalists were present at the dialogue, many of whom participated in the discussions.