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Bangladesh and Japan are making significant progress towards initiating formal negotiations for an Economic Partnership Agreement (EPA) this year. The guidelines for these negotiations are expected to be finalized soon. The EPA, set to take effect before 2026, is of great financial importance to Bangladesh as it aims to secure zero-duty benefits for key exports, including garments, leather goods, and electronics. Additionally, Bangladesh is seeking the removal of the average 18 percent duty on all shipments to Japan, which would have a substantial financial impact on trade between the two countries.
Japanese investment in Bangladesh reached a record high of over $100 million in 2022, and currently, around 350 Japanese companies are operating in the country, with over $380 million invested. This EPA is expected to further boost bilateral trade and investment, especially given the growing interest of Japanese companies in diversifying their locations in Southeast Asia and the ASEAN regions.
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