Globalization and Economic Security Bangladesh Perspective more

by Sharoar Hossain
26
Download (.pdf)
Globalization_and_Economic_Security_Bangladesh_Perspective_.pdf
284 KB


P a g e
3
of this industry. To reduce economic insecurity, Bangladesh needs to implement certainstrategies.
Market diversification:
Currently, Bangladesh depends on only two markets; the US and EU. More than96% of its apparels are shipped to
these two markets. Bangladesh needs to diversifymarkets to remove the dependency over the fixed market. For this,
it is necessary to takeproactive steps to access new and potentially large markets. For trade creation, theparticular
targets should be Indian, Japanese, ASEAN and Middle Eastern markets.Recently, Australia has agreed to grant
duty-free and quota-free entry of apparels madein Bangladesh, if it meets rules of origin requirements.

Regional cooperation:
Regional cooperation increases bargaining power and strengthens economicsecurity of the member countries. The
successful trade blocs demonstrate that intra-regional trade can be increased rapidly and substantially through
preferential tradingarrangements. Regional integration can benefit the members through trade creation andtrade
diversion at the cost of non-members. In SAARC political animosity among themembers, particularly between India
and Pakistan, has contributed to such lacklusterprogress. Unless the political leadership of these two countries agrees
to cooperate,substantial increase in intra-regional trade cannot be expected. Formation of regionaland sub-regional
cooperation is encouraged under the present globalization drivenWTO system. If the steps suggested are taken
properly, Bangladesh will be able toensure its economic security.
Pursuing prudent business diplomacy
The benefit of trade relations is positively correlated with the quality ofdiplomatic relations between the trading
partners. Particularly, the quality of economicdiplomacy determines market access and the volume of trade that
occurs between thecountries. Bangladesh may not enjoy the special and differential treatment within theframework
of the WTO if it fails to pursue prudent economic diplomacy with aparticular importing country. It is already evident
that the articulated economic


P a g e
4
diplomacy that Bangladesh maintained with the EU and USA has paid a high dividendin the form of duty-free
and quota-free access to the EU and USA.Use of non-trade issues, like human rights violation or absence of
democracy inthe exporting country also gets importance. Bangladesh has resolved the problem ofchild labour and
eco-labeling, and still struggling with the US demand for granting thefactory workers in the Export Processing
Zones the right to form trade unions. In theabsence of prudent business diplomacy, other measures like development
of backwardand forward linkages, full implementation of cost reduction strategies, product andmarket
diversification, etc. may not enable Bangladesh to achieve its goal.
The role of WTO:
Globalization has led to a profound political and social revolution. Thetraditional sovereignty of the nation-states is
being eroded. The WTO, along with theWorld Bank and IMF, are imposing many economic policies (reforms and
restructuring)on many countries against their will.The world trading system is almost centrally controlled by the
WTO, anOrganization dominated by rich industrial countries led by the USA. The nature,structures, composition
and operating procedures of WTO are not democratic. Thesmaller states, although theoretically voting members, do
not get opportunities to havetheir agenda included in the top-level meetings of the WTO, as we have seen in
Seattleand Cancun. As a result, the decisions taken and the rules and regulations framed andimplemented by WTO
mostly favour the rich countries.However, some changes have begun to emerge. The LDCs have created
somepressure to change the behaviour of WTO, but their success is not yet visible. The failureof the WTO
ministerial meeting at Seattle, Washington; in November, 1999 gives someindication of the problems facing the
globalized world. The major industrial states failedto draw up a realistic agenda. Many developing countries
interpreted this as a ploy ofnew protectionism. The demonstrators of Seattle, Washington DC, Philadelphia,
London, Prague and Genoa called WTO a tyrants watchdog, at the portals of the new,
improved, post-colonial, multi-cultural, genetically modified, low-
fat imperialism.
3
At
3
Yuen, E. et al, (2002),

The Battle of Seattle: The New Challenges to Capitalist Globalization
,
Soft Skull Press,
February 2002.



P a g e
5
Seattle, WTO was exposed as secretive and wholly undemocratic in its internal practice;
the elite nations met in the green rooms for important decisions while the poornations were symbolic window
dressing.
4
The WTO, as the conduit of capitalistglobalization, subordinates all interest groups to the universal interest of
capital. Theworld trading system is such that it integrates low-cost countries with the high-costcountries in a way
that automatically makes the small countries totally dependent onhigh-
cost countries. This makes the small nations economic security vulnerable.
Without appropriate reforms in the structure and operation of WTO, the economicsecurity of Bangladesh will be
threatened because eventually it will be forced tospecializ
e in the supply of indentured labour. It will never be able to free itself from
the low-level poverty trap.
Bargaining and negotiating capacity building
Capacity building does not merely mean an increase in the production capacity.It refers to bargaining capacity and
negotiating skills as well. A small individual state onits own does not have any capacity to influence the decision
that is taken at theministerial meeting of the WTO. To increase their bargaining capacity, the small nationsmay form
special pressure groups and try to put forward their demands jointly. Unityof the developing countries sometimes
puts pressures on the approaches taken by thedeveloped world. Sometimes these failures did not necessarily mean
the victory of the
united poor countries. The LDCs did not get any benefit or assurance of future
economic security due to this failure.
Conclusion:
Only a small number of economically powerful countries will continue to exploita large number of helpless, poor
countries. There is no hope for genuine distribution ofthe gains of globalization on the basis of equity and justice.
The process of disputesettlement at the WTO level works against the interest of the poor countries. Theeconomic
security of a poor country like Bangladesh will remain vulnerable as long asthe stronger states do not treat the
weaker states on the basis of equity and fairness. Ifthe stronger nations stick to their old attitude then the economic
security of the smallstates including Bangladesh cannot be ensured.