EPA with Japan expected next month

Bangladesh expects to sign the Economic Partnership Agreement (EPA) with Japan by the end of next month, as negotiations between the two countries have already been completed, Commerce Secretary Mahbubur Rahman told The Daily Star yesterday.

"If the deal cannot be signed by the end of December for any reason, it will be signed within January 1 or 2, as both sides are ready," he added.

Negotiations for the bilateral EPA concluded in September in Tokyo, though the Japanese government took additional time to verify certain issues before agreeing to the signing. A draft of the finalised negotiation is currently under review by Japan's law ministry.

"If any issue is raised for further negotiation, both countries can resolve it through consultation. It is just routine work as the main negotiation is already completed," the commerce secretary said.

The talks began in March 2024 under the ousted Awami League-led government and were continued by the interim government after the political changeover in August that year. With the deal, Bangladesh is seeking to secure preferential trade benefits from Japan ahead of its graduation from the least developed country (LDC) category in November 2026.

Rahman described the upcoming signing as a routine procedure, emphasising that the agreement's completion is independent of which government initiated or finalised the negotiation.

Japan has also agreed to maintain duty-free access for Bangladeshi products for three more years, similar to the European Union's arrangement, even after Bangladesh becomes a developing nation next year.

Beyond trade benefits, the EPA is expected to facilitate Japanese investment in Bangladesh and enhance the country's image internationally, given Japan's high compliance standards for trade and foreign direct investment.

The negotiations included three meetings in Dhaka and four in Japan, covering trade, investment, exports, and imports.

With the LDC graduation looming, Bangladesh is trying to sign free trade deals with major partners to ensure market access. So far no such deals have been inked with any country. Previously a preferential trade agreement with Bhutan was signed in 2020.

Japan is a key market, being the first Asian nation where Bangladesh exported over $1 billion in more than a decade, thanks to duty-free and quota-free access under its LDC status. Bangladeshi garments, leather goods, and footwear are in high demand in the island nation.