The government has been exhorted to consider a comprehensive free trade agreement (FTA) or a preferential trade agreement (PTA) with South Korea aiming to ensure trade benefit after graduation.
The Bangladesh mission in South Korea has recently suggested that the government authorities take steps regarding this issue shortly.
It has made suggestion in order to overcome likely export shocks from the developed Korean market after the country's graduation from the LDC club in 2026.
The government should fix its position and devise the next course of action to this end through conducting a feasibility study with stakeholders, said the mission.
It sought a decision on FTA/PTA as early as possible to ensure trade preference in the market as any type of trade deal involves a long-term process, a source said.
The mission has called for the government to request Korean to continue DFQF (duty free, quota free) facility for Bangladeshi products until any FTA or PTA is done with it.
Korea has expanded its DFQF facility for LDCs (least developed countries).
Currently, it provides duty-free market access to Bangladesh in 95 per cent of tariff lines.
Korea will not provide DFQF market access to products from Bangladesh unilaterally after its graduation in 2026, according to an embassy letter sent earlier.
The East Asian nation has informally informed the Bangladesh embassy in Seoul of its reluctance to unilaterally give DFQF access in favour of Bangladeshi goods, reads the letter.
It was hinted that Korean might come under pressure from the countries that have such trade deals with it once the facility is given independently to Bangladesh even after its graduation.
On 31 March 2021, the Bangladesh mission requested the Korean trade, industries and energy ministry to form a joint feasibility study team for any prospective FTA.
However, the ministry has not informed the mission anything regarding the issue as yet.
Bangladesh and South Korea are the members of the Asia-Pacific Trade Agreement (APTA). Both countries have been maintaining good bilateral trade ties for long.
Realising this urgency, Bangladesh is trying to secure duty-free access to several markets as many developed countries will not continue this facility in the post-LDC era, says a commerce ministry official.
"Many countries want to build business relations with us. But we cannot tap the potential for a lack of proactive drive," according to the official.
Currently, Bangladesh enjoys DFQF access to the developed and advanced developing markets as a member of the World Trade Organisation, which is known as generalised system of preference (GSP) facility.
Bilateral trade between Bangladesh and Korea has already crossed $2.0 billion.
Bangladesh's exports to Korea totalled $398.67 million and $530.25 million in fiscal years 2020-21 and 2021-21, according to the Export Promotion Bureau (EPB).
It has set this fiscal a target for $600-million export earnings from South Korea.
