Asian nations to sign trade deal despite Bangladesh pullout
Asian nations to sign trade deal despite Bangladesh pullout
Sarah Stewart, Agence France-Presse, Phuket, Thailand
Asian foreign ministers on Sunday salvaged a free trade deal jeopardized by Bangladesh's sudden withdrawal, pledging to throw open their markets by abolishing tariffs before 2017, officials said.
The five founding nations of BIMSTEC (Bangladesh, India, Myanmar, Sri Lanka and Thailand -- Economic Cooperation) were expected to ink the draft deal at a ceremony later on Sunday, leaving new members Bhutan and Nepal to join later.
But Bangladesh pulled out Saturday after demanding compensation for any revenue lost as a result of dropping tariffs, ignoring other members' assurances that their concerns could be addressed within the agreement.
Faced with the prospect of only four of the seven BIMSTEC members signing up to the deal, the Thai hosts considered postponing the ceremony to a summit planned for July when it hoped more nations would be ready to join.
However, Nepal and Bhutan saved the day by making quick decisions to enter the deal, Thai foreign ministry spokesman Sihasak Phuangketkeow said after a meeting of the group's foreign ministers on this Thai resort island.
"Six countries will be signing with the exception of Bangladesh," he told reporters. "In the end (the ministers) decided that if they didn't sign it after having already announced it, it would send out the wrong signal."
Sihasak said Bangladesh had wrongly thought that because a BIMSTEC summit originally planned for Monday was postponed several weeks ago, the signing of the free trade deal would also be delayed.
"Maybe that issue of compensation could have been cleared up in time if they had not been under the impression that the signing would be postponed until the summit," he said.
"They don't see the issue of compensation as something that can't be resolved... there are quite a few ways of dealing with the concerns of Bangladesh."
Under the deal, BIMSTEC's more-developed members India, Sri Lanka and Thailand will commit to abolish tariffs by 2012 while the three less-developed members Myanmar, Bhutan and Nepal will have another five-year grace period.
Tariffs will begin to be reduced in mid-2006, with products designated for "fast track" treatment to be traded on a zero- tariff basis by mid-2009 for the three developed members and by mid-2011 for the poorer members.
Thai Foreign Minister Surakiart Sathirathai said in an opening speech that the seven-nation BIMSTEC grouping was "the logical linking mechanism to bring together various interlocking pieces of the jigsaw puzzle that is Asia."
The BIMSTEC trade deal, aimed at linking South and Southeast Asia which together are home to nearly two billion people, was part of a trend towards unfettered trade in the region, he said.
"This network of functional cooperation, while embryonic, has the potential, in time, to develop into an Asian economic community," he said, referring to the web of agreements, dialogues and joint projects signed in recent years.
"BIMSTEC is poised to fulfill its promise of bridging South and Southeast Asia and elevating the relationship onto a higher plane of cooperation."
Nepal and Bhutan were on Sunday formally admitted to the grouping, represented by their foreign ministers who both wore national dress -- Bhutan's Lyonpo Khandu Wanchuk resplendent in a knee-length checkered robe cinched at the waist.
Officials said earlier that the ongoing talks would touch on establishing a common position on terrorism, and finding ways to cooperate to fight infectious diseases like the bird flu which has swept across Asia.
The bird flu outbreak has killed 18 people in Vietnam and Thailand and emerged in poultry in eight other Asian nations, only a year after the SARS epidemic caused panic as it swept the region.