The Bangladeshi Minister for Finance and Planning Saifur Rahman visited the European Commissioner for Trade Peter Mandelson February 14 in Brussels as part of a three-day visit that was also to include contacts with the European Parliament.

The EU is the biggest trade partner of Bangladesh. Presently, among LDCs Bangladesh is the most prominent exporter to the EC representing 20% of the total exports from all LDCs to the European market. Bangladeshs principal exports to the EU are textile products. The EU has abolished textiles quotas since 1 January 2005. The Minister was said to have drawn the attention of Mandelson to the difficult period of adjustment for Bangladesh in the environment for international textile trade.

In addition and in response to the Tsunami disaster, the European Commission has proposed to accelerate the entry into force of the new EU preferential trade regime for developing countries. The new Generalised System of Preferences (GSP) will now come into effect on April 1. Saifur Rahman hoped the GSP facility would be kept going and the terms reviewed to allow Bangladesh better utilise its opportunity.

The EU Trade Commissioner assured that Bangladesh's broader interest would be in his mind and while the EC formulates policy, the European market will be kept open for Bangladesh.

The European Union has also recently emphasised the need for political stability in Bangladesh, saying it would help draw more foreign investment into the country and also help in proper development while boosting trade.

Tensions have increased in the country as the Bangladeshi main opposition party Awami League prepared to enforce a two-day nationwide strike from Tuesday to protest last month's grenade attack on one of its rallies which killed former Finance Minister A S M Kibria and four others. A British official in contact with the Foreign Ministy in Dakha during the week was said to have indicated his country was prepared to aid Bangladesh in combating terrorism.

Later in Brussels the minister addressed a policy dialogue: "Bangladesh: Options and Opportunities," on the state of Bangladesh's relation with the EU and future prospects. organised by the Embassy of Bangladesh in Brussels. Syed Maudud Ali, Ambassador of Bangladesh to the European Communities moderated the policy dialogue. Discussions covered policy issues concerning bilateral development cooperation and trade, including good governance, public sector reforms, civil order, justice and human rights. Saifur told the audience that the current macroeconomic situation in the country is, by and large, stable. Foreign exchange reserve is also steady. The stable macroeconomic situation was said to be the result of a mixture of prudent monetary and fiscal policies. The external current account deficit is also low. This reflects the continued high growth of exports, increased flows of remittances, moderate growth in money supply as well as that of imports.

The country has also been negotiating a special trade and investment agreement with the United States and was said to be close to signing.

Participants agreed that there was an urgent and critical need to improve Bangladesh state machinery for projecting and creating an awareness in the outside world about the progress made on micro and macro-eco