WTO and Regional Trade Negotiation outcomes: Quantitative assessments of potential implications on Bangladesh

Despite being somewhat paradoxical, the world has in recent times witnessed ambitious multilateral trade negotiations along with a proliferation of regional trading blocs. Almost all countries are now involved in both types of trading arrangements, with Bangladesh actively participating in several important trade talks under the World Trade Organisation (WTO) alongside its commitments to the South Asian Free Trade Area (SAFTA). Different multilateral and regional trade negotiations have, however, different implications. For example, while the liberalisation of global agricultural trade- by reducing subsidies in rich countries and thereby causing prices to rise-will benefit many developing country farmers, it may hurl a formidable challenge for the net food importing countries in ensuring food security for their poor populations. Similarly, WTO negotiations in non-agricultural goods aim at improving market access for many, but for the least developed countries, including Bangladesh, currently enjoying tariff preferences in a large range of products in major markets, the ensuing outcomes could lead to preference erosion, undermining their competitiveness. Regional trading arrangements can also be challenging as they tend to replace global imports with less efficient regional supplies resulting in adverse welfare consequences.

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