BIMSTEC to propose new date for FTA
2006-07-18
BIMSTEC to propose new date for FTA
Kantipur Report
KATHMANDU, July 19 2006 — BIMSTEC, an economic bloc consisting seven South and Southeast Asian countries, is resuming trade negotiations next week in order to finalize the bloc’s free trade agreement (FTA) and propose a new date for its enforcement.
“Trade Negotiation Committee (TNC) has announced to convene a meeting from July 25 in Colombo,” said an official at Ministry of Industry, Commerce and Supplies (MoICS). The meeting will last for four days, he said.
Though the members had earlier planned the Colombo meet for May, it was cancelled due to internal problems in Sri Lanka and political upheaval in Thailand. The cancellation had forced the bloc to miss the FTA implementation deadline of July 1.
“Owing to the pressing situation, the meeting will mainly revolve around outstanding issues of free trade accord on trade in goods,” said the official. The issues related to free trade accord on trade in services would be dealt on a sideline, he added.
During the meeting, technical experts will contest on key trading arrangements such as rules of origin, negative list for tariff reduction and list of items to be opened under the fast track of trade liberalization program.
Technical experts from Nepal, India, Bangladesh, Bhutan, Sri Lanka, Thailand and Myanmar will also negotiate on a separate framework of dispute-settlement mechanism.
“The TNC will also work out a new date for implementing the FTA on trade in goods,” said the source. It is most likely to be fixed for January 1, 2007, he added.
The TNC will propose the new date to Economic and Trade Official’s Meeting, a body of BIMSTEC foreign secretaries, scheduled to convene in Dhaka within a month for consideration.
“The new date will then have to be endorsed by the Bangkok Working Group, the highest technical body of the bloc, for it to become official,” said the source.
Besides FTA on trade in goods, BIMSTEC members have agreed to kick start free trade area for service trade and investment from July 2007. They started negotiations to finalize its FTA for services and investment from January 2006. However, it is still to gain pace.
As for the FTA on trade in goods, they have agreed to open trade under ’fast track’ and ’normal track’ of trade liberalization.
Under the fast track, the members have agreed to bring down tariffs to a range of zero to 5 percent by June 2009 for developing countries and by June 2011 for least developed countries.
Under the normal track, however, they will follow a gradual tariff liberalization program. The developing countries will have to reduce tariff for each other by June 2010 and with least developed members by 2012.
While the compliance deadline for developing countries is June 30, 2015, for LDC members it is July 2017.
“The members are still to discuss how the missing of July 1 enforcement target would impact other deadlines,” said the official.
