BANGLADESH INSTITUTE OF INTERNATIONAL AND STRATEGIC STUDIES

POTENTIALS OF TRADE COOPERATION AMOMG THE BIMST-EC COUNTRIES

Author: AKM Atiqur Rahman, Shamsur Rahman

DOI Link: DOI: https://www.doi.org/BIISSj2004v25n2a2

ABSTRACT

One of the recent initiatives in regional economic cooperation has been the economic cooperation arrangement among five Indian Ocean rim countries, viz Bangladesh. India, Myanmar, Sri Lanka and Thailand which is known as BIMST-EC. The present paper makes a preliminary attempt to examine the trade potential among the BIMST -EC countries. The paper observes that currently intra BlMST-EC trade is quite low, major trading partners of the BIMST-EC countries being the developed world. A gravity model analysis reveals that although bilateral export exceeds potential export in few cases. total export to BIMSTEC countries is lower than potential export for each of the five countries. Although trade complementarities among the BIMST -EC countries are not that strong. it is quite good in consideration of low variation in per capita income. Furthermore, there is wide variation in the nature of products exported from BIMSTEC countries in terms of resource base of the products providing some indirect evidence of compIementarities. Hence, freer trade among the BIMST -EC countries would have trade creating effect. However, expansion of trade and cementing economic cooperation is largely contingent upon appropriate trade facilitating measures and strong political will.