China has announced that it will grant 100 percent duty-free access to all products from Bangladesh, as well as other least developed countries (LDCs). This decision was conveyed by Chinese Ambassador to Bangladesh, Yao Wen, during a meeting with Bangladesh’s Foreign Secretary Jashim Uddin at the foreign ministry yesterday.
Yao Wen had previously mentioned at the Sino-Africa summit in early September that China would extend a full tariff exemption to LDCs, including Bangladesh, Jashim told reporters.
In 2022, China had already provided duty-free access to 98 percent of Bangladeshi goods, adding 383 new products to the list, notably including leather and leather goods. This was an increase from the 97 percent duty-free access granted in 2020.
China remains Bangladesh's largest trading partner. In the fiscal year 2022-23, China exported goods worth over $18.6 billion to Bangladesh, while Bangladesh's exports to China totaled around $676 million.
Jashim highlighted that China has been a major source of foreign direct investment for Bangladesh, contributing about $8 million since the formation of the interim government. He also noted that efforts to export mangoes from Bangladesh to China are nearing completion, with exports anticipated to begin next year. Additionally, Bangladesh is working with China to export other fruits like jackfruits and guavas.
In fiscal year 2020, China imported $2.4 trillion worth of goods, but Bangladeshi exports made up only 0.05 percent of that, indicating significant potential for growth in trade with China. MA Razzaque, chairman of the Research and Policy Integration for Development, suggested that Bangladesh could potentially earn $25 billion in exports if it could capture just one percent of China's import market.
Economists suggest that diversifying the export basket beyond the garment industry will be crucial for Bangladesh to increase its exports to China.
Jashim also mentioned that discussions included regional and multilateral issues, mutual support in international forums, and potential assistance with flood management. The upcoming year will mark the 50th anniversary of diplomatic relations between China and Bangladesh, a milestone that was also discussed.
