The government has been urged by the Bangladesh mission in South Korea to consider signing a free trade agreement (FTA) or a preferential trade agreement (PTA) with the country to ensure trade benefit after graduation.
The mission suggested this to overcome likely export shocks from the developed South 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.
The mission has called for the government to request South Korea to continue the DFQF (duty free, quota free) facility for Bangladeshi products until any FTA or PTA was signed.
South Korea has expanded its DFQF facility for LDCs (least developed countries).
Currently, it provides duty-free market access to Bangladesh in 95% of tariff lines.
South 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, read the letter.
It was hinted that South Korea 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.
In March 2021, the Bangladesh mission requested the South 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.
Currently, Bangladesh enjoys DFQF access to the developed and advanced developing markets as a member of the World Trade Organization, which is known as the generalized system of preference (GSP) facility.
Bilateral trade between Bangladesh and South Korea has already crossed $2 billion.
Bangladesh's exports to South Korea totalled $398.67 million and $530.25 million in FY21 and FY22, according to the Export Promotion Bureau (EPB).
It has set this fiscal a target for $600 million export earnings from South Korea.
