Bangladesh fears competition from the Regional Comprehensive Economic Partnership (RCEP). Participating countries, including Bangladesh’s competitors in the apparel trade such as India, China, Vietnam, Indonesia, Myanmar and Cambodia, have been gearing up local industries involving textile, yarn and garment to reap the RCEP’s benefits. While RCEP members will be able to do business with each other at zero tariff, Bangladesh will face duties on its exports.
RCEP is a proposed free trade agreement between the ten Asean states and Australia, China, India, Japan, South Korea and New Zealand. It will account for over 39 per cent of global GDP. Prospective RCEP member states account for 45 per cent of the world’s population and about 40 per cent of world trade. The RCEP deals with goods, services, trade and investment, technical and economic cooperation, e-commerce and intellectual property rights. The deal is set to witness fruition from this year’s end. The GDP of RCEP member states is likely to amount to nearly $250 trillion by 2050.
If it goes through, Bangladesh faces the prospect of becoming solely a garment stitching nation as its yarn and fabric manufacturers will lose their competitiveness. If possible, Bangladesh may join RCEP in future.