An Evaluation of the Trade Relations of Bangladesh with ASEAN: Justification of Being a Future Member

Abstract

The government of Bangladesh wants to reduce the dependency of export from West by creating new market to East and South East Asian countries. The paper aims to evaluate the present trade performance of Bangladesh with ASEAN countries and to provide the strategies to develop this trade relationship. The data of export and import of Bangladesh with ASEAN countries has been analysed for the period 1999-2010 in this study. The study has used financial ratio, percentage, mean, growth, covariance, and hypothesis test etc. for analysis of data and drawing inferences. Our results indicate that the growth rates of export are fluctuating but increasing positively and the average growth rate of export is 16%. The average import from ASEAN is 16%, while the average export to ASEAN is only 1.6%. The growth rates of trade deficit are positive with increasing trend and the average growth rate of trade deficit to ASEAN is 18%. The export-import ratio of Bangladesh with ASEAN countries is steady with fluctuating trend and the average export-import ratio to ASEAN countries is 0.06 but the total export–import ratio of Bangladesh is 0.57, which is much higher. To improve the country’s overall trade balance, especially trade balance with ASEAN countries some policy recommendations are offered in this paper.

Keywords: ASEAN, Export, Import, Export-Import Ratio, Trade Deficit.