Sign FTA with Korea that benefits both nations

Bangladesh needs to sign a free trade agreement (FTA) with South Korea that enables a win for both as the East Asian country previously attained huge success engaging in such bilateral agreements, experts said yesterday.

Such agreements will counter the loss of different preferential treatments related to trade once Bangladesh makes the United Nations status graduation from a least developed country (LDC) to a developing one, they said.

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They were addressing a virtual dialogue styled "Bangladesh-South Korea Trade and Investment Cooperation: In the context of LDC graduation" organised by the Dhaka Chamber of Commerce and Industry (DCCI).

The government will give special focus on revisiting decades-old bilateral agreements, exploring the possibility of signing FTAs, regular exchange of trade missions and direct connectivity between Dhaka and Seoul, said Masud Bin Momen, senior secretary to the foreign ministry.

He said after Bangladesh's status graduation, South Korea may continue to provide preferential treatment for Bangladeshi export items.

About 150 South Korean companies are now in operation in Bangladesh, according to him.

Momen also underscored the importance of creating skilled human resource to face the upcoming challenges pertaining to enhancing productivity.

DCCI President Rizwan Rahman said South Korea can invest in joint ventures in Bangladesh's promising industrial sectors like agro and food processing, plastic manufacturing, jute and jute goods, light engineering and automobiles, hi-tech parks, fourth industrial revolution technologies and structured economic zones.

In 2021, bilateral trade stood at around $1.525 billion with a negative balance of $727 million for Bangladesh, he said.

He said currently, around 95 per cent of Bangladeshi items exported to South Korea receive a duty-free quota-free facility under a preferential scheme for the LDCs.

Kihak Sung, chairman and CEO of Youngone Corporation, said the investment of Youngone Corporation in Bangladesh was about $600 million.

In the next five years, readymade garment export to South Korea will cross $1 billion, he hoped.

As South Korean investments are coming in to Bangladesh's high-tech industries, stable and high quality energy supply is very important, he opined.

He urged for smoother customs and port facilities, an easy tax regime, smooth inland transportation system and product diversification.

He also stressed the importance of enhancing labour productivity and efficiency for better production.

Youngone Corporation has already developed a high-tech park together with the Bangladesh government and is going to invest a minimum of $200 million in the next couple of years, said Sung.

M Delwar Hossain, Bangladesh ambassador to South Korea, said South Korea was the fifth largest foreign investor in Bangladesh.

South Korean investors are now showing interest to invest in electronics, home appliances, automobile and high-tech industries, he said.