Chinese Ambassador to Bangladesh Yao Wen on Sunday said China stands ready to work together with Bangladesh to announce the conclusion of the feasibility study of the Bangladesh-China free trade agreement (FTA) in the near future.
He said China is ready to strive to officially initiate negotiations within this year, so as to conclude the negotiations before 2026, commencing the building of a bilateral free trade zone.
"I am convinced that the early signing of the China-Bangladesh FTA will undoubtedly open a new chapter of mutual benefit and win-win cooperation, ushering in a new golden era of economic and trade cooperation between China and Bangladesh," Ambassador Yao said.
Signing FTAs with other countries is an inevitable choice for Bangladesh to achieve its Vision 2041, said the Chinese Ambassador.
What China has experienced demonstrates that signing FTAs with other countries will definitely benefit Bangladesh in the long run, the envoy said.
He was speaking at a seminar titled “China-Bangladesh Free Trade Agreement: A Mutually Beneficial and Win-Win Choice” held at the Embassy of China in the evening.
State Minister for Commerce Ahasanul Islam Titu spoke at the seminar as the chief guest, highlighting various aspects of the bilateral relations.
Dr Mohammad Abdur Razzaque, Chairman of RAPID, Al Mamun Mridha, Secretary General of Bangladesh China Chamber of Commerce and Industry (BCCCI) and Ke Changliang, President of Chinese Enterprises Association in Bangladesh (CEAB), among others, spoke.
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The FTA serves as a guarantee for the healthy and stable development of bilateral economic and trade cooperation between China and Bangladesh, said Ambassador Yao.
The foundation of economic and trade cooperation between Bangladesh and China is solid, extensive, and diverse.
In terms of trade, China has maintained its position as Bangladesh's largest trading partner for 13 consecutive years, with bilateral goods trade reaching $24 billion in 2023, said the envoy.
In terms of investment, China's FDI stock in Bangladesh reached $3.2 billion by 2023, making China the second-largest investing country in Bangladesh, he added.
In terms of contracting, Chinese enterprises have constructed 7 railways, 12 roads, 21 bridges and 31 power plants in Bangladesh.
The China-Bangladesh FTA covers areas such as trade in goods, trade in service, investment, e-commerce and high-tech industry cooperation, providing a basic framework and solid guarantee for future bilateral economic and trade cooperation.
"The China-Bangladesh FTA is imperative for the enhancement of bilateral economic and trade. China and Bangladesh are strategic partners, which will be further upgraded in the future," said Ambassador Yao.
However, he said, the only trade and investment agreement between the two countries, namely the Agreement on the Encouragement and Reciprocal Protection of Investments signed in 1996, does not align with the increasingly close relations and exchanges between our two countries.
"What we need is a modernized agreement in line with the current state of bilateral cooperation and the global economic trends," he said, adding that with the China-Bangladesh FTA poised to provide a top-level framework for bilateral cooperation, the economic and trade relations are set to embrace a more sustainable, stable and healthy development momentum.
The FTA will bring significant benefits to Bangladesh, he hoped.
According to the feasibility study report, the overall tariff on goods imported from China to Bangladesh will significantly decrease after the signing of the FTA, leading to a reduction in import prices, said Ambassador Yao.
This will have an immediate effect on alleviating inflation in Bangladesh, he mentioned.
In the long term, the decrease in prices of raw materials for Bangladeshi products will definitely enhance their competitiveness in the international market, laying a solid foundation for Bangladesh to continuously increase its foreign exchange reserves.
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The FTA will also make China’s investment in Bangladesh more convenient and efficient, thus make further contribution in creating employment opportunities, upgrading industries and diversifying exports, Yao said.
Earlier this year, Bangladesh successfully held its general election, the envoy said, adding the utmost priority for the new government is to achieve stable economic development and graduate from the Least Developed Countries (LDC).
"Signing FTAs with other countries is therefore regarded as a crucial way to achieve these goals," said the envoy.
Take China as an example, he said, China accelerated the signing of FTAs with other countries after joining the WTO in 2001.
In spite of the fact that China's overall tariff has decreased from 15.3% in 2001 to 7.3% in 2023, Yao said, China's industries have developed rapidly, which had driven China's GDP from $1.3 trillion in 2001 to $18 trillion in 2023, tax revenue from $184.9 billion in 2001 to $2.6 trillion in 2023, and tariff revenue from $10.2 billion in 2001 to $42.5 billion in 2022.
Right now, the envoy said, China is in a new era of advancing the rejuvenation of the Chinese nation on all fronts through a Chinese way to modernization, while Bangladesh is also at a critical stage of graduating from the LDCs and is working hard to realize its Vision 2041.