Through a possible Free Trade Agreement (FTA), Bangladesh and China aim to advance their bilateral economic relationship. Experts believe this might be a game-changer for both nations.
On 8th-11th July, Bangladeshi Prime Minister Sheikh Hasina is anticipated to travel to China in an important move to strengthen the relationship. Her visit is intended to reduce the nearly US $ 17 billion trade imbalance that favours China and encourage greater Chinese investment in Bangladesh.
Experts noted that China and Bangladesh might work to negotiate an FTA as a catalyst for each nation’s economic development, based on the concepts of win-win and mutual benefit.
The pact, which aims to increase bilateral commerce and investment as well as the creation of jobs, may come to an end before Bangladesh leaves the group of least developed nations (LDCs) in 2026.
The visit of Prime Minister Sheikh Hasina to Beijing, according to Chinese Ambassador to Bangladesh Yao Wen, will be a “game-changer,” according to a recent programme.
“In terms of trade, China has maintained its position as Bangladesh’s largest trading partner for 13 consecutive years, with bilateral goods trade reaching US $ 24 billion in 2023. In terms of investment, China’s foreign direct investment (FDI) stock in Bangladesh reached US $ 3.2 billion by 2023, making China the second-largest investing country in Bangladesh,” he stated.
The China-Bangladesh FTA covers areas such as trade in goods, trade in services, investment, e-commerce and high-tech industry cooperation, providing a basic framework and solid guarantee for future bilateral economic and trade cooperation.
Data from Bangladesh Bank and the Export Promotion Bureau (EPB) show that, in the fiscal year 2022–2023, bilateral commerce between Bangladesh and China totaled US $ 18.5 billion. Bangladesh received US $ 17.83 billion in imports and US $ 677.36 million in exports worth of goods from China. Thus, there was a US $ 17.15 billion trade deficit.
Bangladesh’s imports totaled US $ 19.35 billion compared to US $ 683.43 million in exports in FY ’22, US $ 12.93 billion compared to US $ 680.66 million in FY ’21, US $ 11.49 billion compared to US $ 600.11 million in FY ’20, and US $ 13.85 billion compared to US $ 831.20 million in exports in FY ’19.
Bangladesh exports primarily single-strand jute and textile bast fibres, T-shirts, pants made of cotton, breeches, jerseys, pullovers and acid oils from refining as well as live eels to China.
On the other hand, Bangladesh imports many items, including textiles and textile articles, machinery and mechanical appliances, electrical equipment, parts thereof, and parts and accessories of such articles, medical instruments and apparatus, and products of the chemical or allied industries, from China.