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Thursday, September 18, 2014

Friday, October 12, 2012
Editorial

Editorial

Tapping the full potential of D-8

Preferential Trade Agreement needed to enhance trade

The Third Developing 8 (D-8) ministerial level meeting concluded in Dhaka on October 10 with a call for strengthening the multilateral industrial relations amongst the eight Muslim majority countries that form the group. D-8 that came into being through the Istanbul Declaration in 1997 represents 13 per cent of the world population and 60 per cent of the Muslim population globally. Despite the fact that some of the eight countries have been identified by Goldman Sachs as belonging to 'Next Eleven emerging countries', D-8 has not evolved into a trade facilitating body like the ASEAN.

Although 12 sectors ranging from IT, petrochemicals, fertilisers, SME, etc. were identified by D-8 member countries on which trade was to be encouraged, the failure to remove trade barriers has hampered the functioning of the body to its potential. In the event that a comprehensive trade agreement was put in place, member countries would benefit enormously. For instance, were Turkey to remove high tariff on Bangladeshi garments exports, the sector would not have registered a 31 per cent drop to $356million in FY 2011-12 over preceding year. Again, had a tariff-free regime among D-8 countries existed, Bangladesh could diversify sourcing of the annual demand for 3.7million bales of raw cotton to countries like Egypt, Turkey and Pakistan from traditional suppliers like the United States. Looking beyond trade of raw materials and finished products, removal of travel barriers within the member countries could have mutually beneficial effects as labour forces could move across national boundaries meeting demands of member countries. Additionally, industries of all 12 sectors could open up for investment with the streamlining of investment process and procedures.

What is encouraging to note is that private sector entrepreneurs of member countries attended the 12 working group meetings during the meet, providing an opportunity to share experiences. However, for D-8 to move forward as a cohesive body, it is imperative that the 22-point “Dhaka Declaration” is followed up on. Unless steps are taken to remove trade barriers, the D-8 will remain a trade association largely on paper and boosting of regional trade will continue to sit on the backburner.

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