South Korea to give tariff benefits to 97% Bangladeshi products

A Comprehensive Economic Partnership Agreement (CEPA) has been signed between Bangladesh and South Korea. The agreement was signed at the Ministry of Commerce on Tuesday, August 4. Commerce Minister Khandaker Abdul Muktadir briefed the media after the signing.

The Commerce Minister said, "We have been able to sign an agreement with one of the world's largest economies in the shortest possible time. Our government has signed its first CEPA within five months." Under the agreement, 97 percent of Bangladeshi products will receive preferential tariff benefits, while South Korea will receive benefits on 87 percent of its products.

The minister said South Korea is a $2 trillion economy, and Bangladesh is gaining a large country as a trade partner. Bangladeshi products such as readymade garments, leather and jute goods will now receive tariff benefits as preferential items. On the other hand, imports from Korea, including agricultural products, plastics and spare parts, will also receive benefits.

Khandaker Abdul Muktadir said, "We want to take Bangladesh to a $1 trillion economy by 2034, for which we need 8 percent growth. That requires foreign investment. Through these agreements, we want to attract foreign investment."

South Korean Trade Minister Yeo Han-koo said Korea and Bangladesh have a long-standing economic relationship, which began 56 years ago with the textile business. But the world is now moving towards product diversification, and both countries must also engage in diversified imports and exports.

He said, "We hope the new government of Bangladesh will further strengthen the country's economy, where we want to work on technology and supply chains."

The Korean Trade Minister further said Korean companies will now be more interested in investing in Bangladesh due to the agreement.

According to data, while bilateral trade between Bangladesh and South Korea is still relatively small, it has been consistently growing in recent years. Total bilateral trade between the two countries stands at approximately $1.39 billion, of which Bangladesh exports products worth about $491.73 million to South Korea, while imports from South Korea amount to about $902.90 million, leaving a trade deficit of approximately $411 million.

Bangladesh's main export products to the South Korean market include readymade garments (knit and woven), home textiles, leather and leather goods, footwear, pharmaceuticals, jute and jute goods, frozen food and ceramic products. In contrast, Bangladesh imports iron and steel, machinery and industrial equipment, electrical equipment, plastics and plastic products, chemicals, and paper and paper products from South Korea.