Graduation from LDC is a matter of pride for us. As in private life, one is supposed to reduce dependence on parents after graduation, now Bangladesh also has to acquire such capability.
International trade will be the biggest challenge for Bangladesh on the way to reducing dependency on other countries, because the duty free facility will be reduced once we graduate from LDC. We are trying to extend the duration of this facility, but it will not be available for long. So, we have to enhance our capability to compete.
Our industries are import dependent. Import processes need to be eased to strengthen the domestic industries, and all the industries have to build the capacity to export products to the international market.
The most important thing to strengthen the domestic industries is quality education. If the technical, vocational and managerial skills of our huge young manpower can be ensured, productivity of the domestic industries as well as product quality will improve.
Significant improvements have been made in the infrastructure sector in recent years. We have to continue this improvement. We need to ensure investment and business-friendly infrastructure across the country.
The most important thing right now is to rationalise the tariff which is important to protect the interests of the domestic industry as well as increase exports. Because, there are not enough raw materials in Bangladesh. If the import process of raw materials and intermediate goods is eased, the export will also increase.
As a least developed country, Bangladesh is now enjoying privileges from other countries, which will not be available after graduation. After graduation, to get any facility from any country, we have to offer facilities in a reciprocal way. In order to sign FTA with different countries, Bangladesh will have to reduce tariffs, supplementary duty and regulatory duty.
A sudden drastic reduction in tariff after graduation will harm the local industry. There is a risk for local manufacturers to lose in the competition with imported goods. Therefore, it is necessary to reduce the tariffs step by step from now on.
Earlier, FTA used to mean only export of goods, now that idea has changed. In order to sign FTA with different countries, Bangladesh has to emphasise on export of goods as well as various services, especially manpower.
Foreign investment played a big role in building the strong economy of China and Vietnam. Bangladesh also needs a huge amount of FDI. In order to get it, a business and investment-friendly environment must be created.
Dr Mostafa Abid Khan is a former member of Bangladesh Trade and Tariff Commission