Japan-Bangladesh EPA: The First Advanced-Economy FTA for Bangladesh
Japan and Bangladesh have completed a joint study for an Economic Partnership Agreement (EPA) and are moving toward formal negotiations. If concluded, this would become Bangladesh's first comprehensive trade agreement with an advanced economy and a major turning point in the country's trade policy trajectory.
For Korea, the Japan-Bangladesh EPA is both a direct competitive threat and an important policy reference point. If Japan secures tariff preferences in the Bangladeshi market, Korean products could face a relative loss of price competitiveness. That raises the urgency of pursuing a Korea-Bangladesh CEPA (Comprehensive Economic Partnership Agreement).
Key Findings from the Joint Study
The Japan-Bangladesh EPA joint study reviewed the current state of bilateral economic relations, trade and investment patterns, tariff structures, non-tariff barriers, and broader disciplines such as services, investment, and intellectual property rights. The report's main conclusion is that an EPA would generate meaningful economic gains for both sides.
| Area | Current Situation | Expected Benefit | Negotiation Issue |
|---|---|---|---|
| Goods Tariffs | Bangladesh avg. 27% | Tariff elimination or reduction | Protection of sensitive items |
| Services | Limited opening | Liberalization in telecom, finance, IT | Regulatory alignment |
| Investment | JICA-centered financing | Stronger protection and promotion | Dispute settlement |
| Rules of Origin | Based on GSP rules | New EPA-origin framework | Value-added thresholds |
| Intellectual Property | TRIPS waiver for LDCs | Stronger IP protection | Link to LDC graduation |
| Labor and Environment | Limited provisions | Inclusion of labor and environment chapters | Implementation mechanism |
Bilateral Trade Structure and Complementarity
Implications for Korea
A Roadmap for Korea-Bangladesh CEPA
The Japan-Bangladesh EPA is an early signal of structural change in Bangladesh's trade environment. For Korean companies, it represents a direct tariff-competitiveness risk, but also a catalyst for advancing a Korea-Bangladesh CEPA. Until a CEPA is negotiated, the most practical response is to monitor the Japan-Bangladesh talks closely while using tariff-mitigation strategies such as EPZ and SEZ entry and export approaches linked to EDCF-backed projects.