Bangladesh Bank Governor on Regional Co-operation: Any Practical Initiative is Welcome
UNB reported a few days back that the Bangladesh Bank governor, Atiur Rahman, has said barbed wire fencing and looking for transit facilities through smaller members are unlikely to be helpful in promoting South Asia regional integration.
‘Erecting barbed wire fencing along state borders with neighbors does not resonate well with integration priorities,’ he told a 3-day conference on ‘Global banking: paradigm shift’ in Mumbai, India .The governor was delivering a special address on ‘Financial integration in South Asia — a few thoughts on how best to go about it’ while trying to show path towards South Asian financial and monetary integration. ‘There can be other feasible options for dealing with illegal movement of goods and people,’ he said, recommending harmonization of tariffs towards cross-border price parity, permitting limited border trade, streamlining of immigration procedures and so forth. He said there was ample scope of substantially scaling up and speeding up the ongoing SAARC initiatives with an explicitly announced longer-term goal of full economic and monetary union. This would be a long haul even in most favorable circumstances while care will need to be exercised, especially by the larger members, not to impede progress in integration with unhelpful policy steps guided by other concerns, he added. Atiur said looking for transit facilities through smaller members to remoter regions of larger economies instead of further facilitating trade of these remoter regions with neighboring smaller economies might likewise raise concerns unhelpful in promoting integration.He said regional central banks in their deliberations in Asian Clearing Union and other forums were active in carrying forward regional cooperation and integration in various dimensions. ‘Non-governmental people-to-people contact and consultation forums could likewise be active in explicitly articulating the longer-term aspirations for full regional integration for faster progress towards prosperity of the people of our region.’He said protracted SAFTA negotiations for lowering tariff and non-tariff barriers to trade have been beset with complications of existence of input and output subsidies on many produces, and with concerns of producers in negotiating countries about preserving their current and future market shares. ‘There has been no announced strategy statement of SAFTA for systematically allaying these concerns,’ said the Bangladesh Bank governor.
We feel that, though some of the issues raised by the governor such as transit and border trade are quite complicated, even then the governor has raised some important issues. It is true that border fencing does not represent a good move.It has neither reduced smuggling nor cross-border movements. Even killing of Bangladeshis by BSF has not reduced. It is also true that SAFTA discussion has moved very slowly .The financial and market integration is long way off. These depend on improvement of political environment. We are no where near it. In some areas tensions are increasing. Still we would welcome any progress in trade facilitation in the region.
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