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WHAT gains the country could derive from the Hong Kong Ministerial is still shrouded in mystery. Ever smiling commerce minister Altaf Hossain Choudhury sounded very optimistic about the outcome. After two or three follow-up meetings in Geneva and Washington, things will be pretty clear about the positive gains that Bangladesh had reaped in the ministerial, Altaf said.
Yet others -- civil society group, non-government organisations (NGOs) and the private sector -- appeared negative about the WTO negotiation outcome. They opined that a severe blow has been inflicted upon Bangladesh and in no way, the country could be benefited.
Bangladesh was fighting for the zero-tariff access all along. But its main objective remains unfulfilled as the United States, in particular, opposed the Bangladesh proposal of granting zero tariff access facilities. Not only that, the US had also vehemently opposed the idea of Bangladesh and Cambodia getting duty-free access to its country.
It was really a messy situation that needs a close scrutiny. Bangladesh has lobbied hard to get quota- and duty-free access of its products to the US markets since long. The country and the Bangladesh garment manufacturers and exporters association hired lobbyists from among the Congress men and the senators from time to time. What these lobbyists did for the country's interests are still not clear. The government's propaganda machines also did fairly a good job depicting a rosy picture about getting 100 per cent duty-free access to the US markets off and on. It was just a routine exercise on the part of government to assure the nation that the country would definitely get duty-free access to the US markets. With the outcome of Hong Kong ministerial, all exercises proved futile.
Even the developing countries such as Pakistan opposed the move of the poorer nations to get the duty-free market access to the developed world which is very unfortunate. In fact, Pakistan's move has bolstered the hands of the US. The agreed tariff line which is 97 percent might delist Bangladesh's major products destined to the US market. The residual 3.0 per cent may include all the major products from the poorer nations, including Bangladesh. Chances are little that the country will get the additional benefit of zero-tariff for its major exportable goods. The duty structure for these will remain the same as before.
The country's expectation of having duty free access of apparel products to the US markets has faded as its negotiators failed to carry out negotiations in an efficient way. At present, products of 33 LDCs get duty free access to the US markets. But the rest of 15 LDCs could not forge unity in the negotiation table. As a result, the hope of a 100 per cent duty free access of Bangladeshi products to the world's biggest economy dashed.
Moreover, Bangladesh will face tremendous pressure in price, service and compliance issues after 2008 when all restriction from China will be removed. Pakistan and Sri Lanka complained to the WTO saying that giving duty free access of Bangladeshi RMG products to the US markets will hamper the growth of the RMG sector of their countries. It is unfortunate that Pakistan worked against the interests of Bangladesh in the global trade talks.
As per the GATT any developing country cannot do such things which Pakistan and Sri Lanka have done. Bangladesh has really failed to foresee the mentality of the developing countries. Private quarters and civil society representatives were simply disappointed with the delegation's performance and pointed out it was the head of the delegation who should be held responsible for such utter failure.
Altaf had on December 14 vowed that anything short of 100 per cent product coverage for duty-free and quota-free market access in a permanent, binding and irreversible manner would be vetoed by Bangladesh. But he had in fact broken his own promise when he approved a proposal for 99.9 per cent product coverage and complete coverage by 2010 the evening before when it came up for discussion at the LDC group. The second time he broke his public promise was when he did not object to the proposal on the table refraining himself from exercising veto power.
Experts said it was a failure in the ability to pick up political signals that led to the failure. The failure of the talks stemmed from a complete lack of negotiating skills within the delegation. In spite of all such developments, the government remains still upbeat about the country's achievement in the key ministerial meeting in Hong Kong. At a post-WTO press conference, the smiling commerce minister said: At long last, we've achieved something that cannot be categorised as a futile exercise. But he did not elaborate on the achievements.
The product list was not finalised in the WTO trade agreement. The follow-up meetings would decide the products of Bangladesh to go in the list of duty-and quota-free market access and identify the products of export interest to bring out of the sensitive list.
Exasperated Bangladesh delegation even forgot to raise the issue of temporary movement of unskilled labour force around the world. In all previous WTO ministerial and meetings, Bangladesh had played an active role on the labour movement issue. But this time, the issue remains to be addressed as yet. ICC-Bangladesh President Mahbubur Rahman said in a recent meeting in Dhaka that 2006 is 'critical' for Bangladesh, given the bitter experience of the country at the Hong Kong ministerial meeting. He said there is a scope for further negotiations on the Mode-4 under which the country can export unskilled and semi-skilled manpower.
There is no denying that the WTO talks have always favoured the economically advanced nations that stand to gain by globalisation. Even then, the Bangladesh delegation should have lobbied to advance the country's position and protested vehemently against the resolutions taken at the WTO meet. Unfortunately, this has not been done. The government has not been transparent in its pronouncements after the WTO meet.
Dhaka's predominant point was the agreement on granting duty and quota-free access to developed markets for goods from the group of 15 LDCs. The final arrangement allows duty and quota-free entry for 97 per cent of products, but authorises the developed countries to maintain restrictions on 3.0 per cent of items, that will include ready-made garments from Bangladesh and Cambodia. The cause mentioned for this was that the garment sectors in Bangladesh and Cambodia are thought to be competitive and have no need for assistance.
However, Bangladesh can pursue bilateral negotiations with major countries to sign free trade agreements (FTAs) for greater market access which remains by far the only solution to such lingering crisis. There should be an inter-ministerial coordination about dealing with trade issues and the finance ministry should also be involved in the WTO process.
To address the global trade-related issues, the government should re-strengthen both the Geneva Mission and the WTO Advisory Committee to help improve the system. Similarly, the WTO Cell should to re-designed and strengthened to face the global challenge.
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