[🇧🇩] Trump's Victory/Tariff/ Bangladesh

[Saif]

Trump’s tariff policy poses major blow for Bangladesh’s export sector

The rationale behind these retaliatory tariffs is not strong and it has only increased concern. It is still unclear what tariff rates will be applied to Bangladesh’s major competitor countries such as Vietnam, India, Indonesia, Sri Lanka, and Pakistan. Among the 14 countries included in the...

en.prothomalo.com

Trump’s tariff policy poses major blow for Bangladesh’s export sector

We lag behind in business and investment environment and our diplomatic influence is limited. Under these circumstances, Bangladesh must adopt strategic and multifaceted measures to ensure future economic security.

Selim Raihan
Published: 08 Jul 2025, 13: 39

Selim Raihan File photo

The three-month suspension period of Trump’s tariffs is about to expire. The US administration has started announcing new reciprocal tariffs in line with the initial plan announced in April. This move will create new uncertainties in global trade and the world economy.

The imposition of a 35 per cent reciprocal tariff on Bangladeshi export goods by the United States is a major economic blow, especially for the ready-made garment (RMG) sector. While the previous US tariff rate was around 15 per cent, it is now more than double. This sudden and steep increase in tariffs could undermine the competitive advantage of Bangladesh’s apparel exports.

The US is Bangladesh’s largest export market. In 2024 alone, Bangladesh exported approximately USD 8.5 billion worth of goods to the US. The burden of the increased tariffs will fall directly on garment producers and also impact millions of workers, most of whom are women.

This will also result in the risk of reduced growth, decreased employment, and increased poverty. These problems are not just economic in nature; they will also trigger social consequences.

The rationale behind these retaliatory tariffs is not strong and it has only increased concern. It is still unclear what tariff rates will be applied to Bangladesh’s major competitor countries such as Vietnam, India, Indonesia, Sri Lanka, and Pakistan.

The reality is that international trade policies are constantly evolving. In this context, Bangladesh’s response must be timely, strategic, and multidimensional. Failure to adapt quickly will deepen economic risks and stymie our future prospects.

Among the 14 countries included in the first phase, the 35 per cent tariff imposed on Bangladesh is among the highest. If it turns out that the tariff rates on competitor countries are lower than on Bangladesh, then the country will face a major blow in terms of competitiveness. Consequently, it will be difficult to make supply chain-based decisions. Buyer and investor confidence will also enervate.

The broader impact of this situation is even more serious. If production costs rise, the US buyers may shift toward countries with lower tariffs. Apparel exports account for more than 80 per cent of Bangladesh’s annual export earnings. This shock has made Bangladesh extremely vulnerable.

Even more concerning is that Bangladesh’s representatives involved in bilateral tariff negotiations with the US seem to have failed to bring a positive outcome. The failure to reach a balanced agreement increases Bangladesh’s risk further in light of current global trade realities and shifting geopolitics.

There is no denying that in an increasingly uncertain and unstable global trade environment, countries like Bangladesh are at greater risk. This is because Bangladesh has limited export product diversity. In addition, our domestic business and investment environment lags in competitiveness, and diplomatic influence is limited. Under these circumstances, Bangladesh must adopt strategic and multifaceted measures to ensure future economic security.

First, the highest priority must be given to increasing export diversification and competitiveness. This requires investment in productivity, technological upgrades, and development of new industrial sectors beyond garments. Overreliance on North American and European markets and apparel products makes Bangladesh more vulnerable to such external shocks. Therefore, diversification of both products and markets is no longer optional, rather it is exigent.

Second, Bangladesh must accelerate negotiations on free trade agreements with major trade partners. It should pursue FTAs with emerging economies in Asia, Africa, and Latin America, and strengthen South-South trade (with other developing countries) and economic cooperation. Through preferential access and the removal of trade barriers, export markets can be expanded, and dependency on specific markets can be reduced.

Third, domestic trade reform is essential. This includes reducing tariffs, minimising non-tariff barriers, and simplifying import-export procedures. These reforms will not only strengthen Bangladesh’s position in trade negotiations but also help reduce production costs, attract foreign investment, and encourage sector-based diversification.

The reality is that international trade policies are constantly evolving. In this context, Bangladesh’s response must be timely, strategic, and multidimensional. Failure to adapt quickly will deepen economic risks and stymie our future prospects.​

 

[Saif]

Dhaka pins hope on last-minute talks

Bangladesh has pinned its hope on the ongoing negotiation to avert 35 per cent US tariff on its exports threatened by president Donald Trump in a letter to chief adviser Muhammad Yunus on Tuesday...

www.newagebd.net

35PC TRUMP TARIFF
Dhaka pins hope on last-minute talks

09 July, 2025, 00:05

Bangladesh has pinned its hope on the ongoing negotiation to avert 35 per cent US tariff on its exports threatened by president Donald Trump in a letter to chief adviser Muhammad Yunus on Tuesday.

Economists have warned that the newly proposed tariff can deal a major blow to the country’s exports as well as economy if Dhaka fails to convince Washington to cut the rate in the ongoing negotiation with the US Trade Representative.

Commerce adviser Sk Bashir Uddin, who flew to Washington on July 4, is leading the Bangladesh side against the USTR in the current negotiation scheduled to conclude on June 11.

Aided by national security adviser Khalilur Rahman,

Dhaka is expected to assure Washington of buying more US-made goods such as fruit drinks, military hardware, and Boeing aircraft as part of cutting the country’s trade deficit with the US.

On Tuesday, finance adviser Salehuddin Ahmed said that the proposed 35 per cent duty by the US on Bangladeshi export products was not a final settlement.

The final settlement will be done through a one-on-one negotiation, he told reporters at the secretariat in Dhaka referring to the ongoing negotiation with the USTR -- after a meeting of the advisory council committee on government purchase.

The finance adviser was answering questions from reporters regarding the US president Donald Trump’s letter sent to the chief adviser asking him to consider that the 35 per cent tariff was far less than what was needed to eliminate the trade deficit disparity between two countries.

In 2024, Bangladesh exported to the US about $8.4 billion in goods and imported from that country goods worth $2.2 billion, meaning that the trade deficit was $6.2 billion for the US.

‘We have had years to discuss our Trading Relationship with Bangladesh, and have concluded that we must move away from these long-term, and very persistent, Trade Deficits engendered by Bangladesh’s Tariff, and Non Tariff, Policies and Trade Barriers,’ wrote the US president.

The US president warned of further dire consequences in case of Dhaka deciding to raise tariffs.Bangladesh-themed souvenirs

‘If for any reason you decide to raise your Tariffs, then, whatever the number you choose to raise them by, will be added onto the 35% that we charge,’ said the US president.

The US president also posted letters on his Truth Social platform unveiling higher tariffs for Japan, South Korea, and a dozen other countries, including Indonesia, Bangladesh, Thailand, South Africa and Malaysia.

These mark a step-up from the 10 per cent levy the president earlier imposed on almost all trading partners.

But the starting date of August 1 marks a delay in Trump’s re-imposition of higher duties, originally due from today.

Currently, Bangladeshi exporters enjoy a tariff of around 15 per cent in shipping their products to the US, the single largest export destination counting over 16 per cent of the country’s overall export of $50 billion in 2024.

Zahid Hussain, former lead economist at the World Bank’s Dhaka Office, said that Vietnam secured a flat 20 per cent tariff while Bangladesh faced a 35 per cent increase on existing sectoral tariffs.

‘Countries like Indonesia and South Africa, which seemed not exactly favoured by president Trump, appear to have negotiated better deals than Bangladesh,’ he added, saying that among the 14 countries announced, only four are behind Bangladesh in negotiations.

Finance adviser Salehuddin said that Dhaka had scope to negotiate a fair deal from the Washington since the trade between two nations was not so big compared to others countries.Bangladesh-themed souvenirs

Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue, said that it was informed that Bangladesh was the first country to begin discussions with the USTR.

Yet, after three months of negotiations, the outcome is deeply disappointing, he observed.

Commerce ministry secretary Mahbubur Rahman the same day said that the final discussion over the tariff would be settled in meetings on June 10 and June 11.

Calling the latest tariff proposals an extension of the previous ones, he said that both the sides had held a number of meetings over the tariff issues.

He said that he had joined all the meetings virtually.

Dhaka’s main focuses for the upcoming meetings would be protecting the country’s interest in its single biggest export market, said the commerce secretary who is expected to join the negotiation in person today.

The commerce secretary said that they were already consulting the National Board of Revenue and other stakeholders regarding the US demand for reducing duties and Value Added Tax on certain products such as wheat, soya bean, aircraft, and machineries.

He hinted that Dhaka might announce buying new Boeing aircraft shortly.

In 2008, Biman Bangladesh Airlines signed a $2.1 billion agreement with the US company Boeing to purchase 10 new aircraft delivered by 2019.

Then national flag carrier Biman has now a fleet of 21 aircraft.​

 

[Saif]

Looming threat from reciprocal tariff

There has been heightened concern the world over about Donald Trump's reciprocal tariff ever since the radical policy on import duty was unveiled in April last. The 90-day tariff pause he announced following stock market crashes was precisely meant to secure 90 trade deals in those 90 days but he m

thefinancialexpress.com.bd

Looming threat from reciprocal tariff

Published :
Jul 10, 2025 00:01
Updated :
Jul 10, 2025 00:01

There has been heightened concern the world over about Donald Trump's reciprocal tariff ever since the radical policy on import duty was unveiled in April last. The 90-day tariff pause he announced following stock market crashes was precisely meant to secure 90 trade deals in those 90 days but he managed to accomplish only two. A day before the expiry of that period, Trump issued letters to heads of government in 14 countries, mostly South-East Asian, revising the rates of the levies announced in April. This time almost another three weeks' time has been granted for further negotiations for reaching a deal. The failure to do so will lead to enforcement of the revised tariff from August 1 next with no further extension of the deadline. According to the latest list of Trump's tariff rates, Bangladesh will face an additional 35 per cent duty on its commodities exported to the US. This is on top of the existing 15 per cent tariff Bangladesh exporters now have to pay.

The government functionaries have tried to assure the people here that the issue is yet to be settled. A delegation headed by Commerce Adviser Sheikh Bashir Uddin, now in America, should have held a meeting with the United States Trade Representative (USTR) in favour of wresting concessions from the US side. But given the outcome of keeping the channel of negotiations with Washington for three months, there is hardly any reason to be optimistic about a drastic cut on US import duty. The rate of levy on export commodities from Bangladesh was lowered by only 2.0 per cent from the original 37 per cent. Exactly at this point, figures the case of Vietnam which could successfully negotiate a 20 per cent tariff on its goods exported to the US. Most importantly, of the two trade deals the Trump administration inked in the 90-day pause period, Vietnam's was one, the other being the US-UK deal.

That one of Trump's objectives was to counter China's growing influence in South-East Asia is certainly corroborated by the Vietnam deal which, although not made public, has been touted by Trump on his social media as satisfactory because American goods will enter Vietnamese market duty-free. Notably, despite the 20 per cent levy on Vietnamese commodities, the trans-shipment clause ---goods from third countries shipped via Vietnam or of origin including parts of a different country--- will be levied 40 per cent duty. All South-East Asian nations depend heavily on Chinese stuff made on a scale and at costs no nation can compete with.

Inclusion of Bangladesh in the list of the 14 countries is therefore not intriguing. Geopolitics plays a part here and Bangladesh's increasing leaning towards China as a source country may provide the answer for not considering its case generously. Trump and Vietnamese state media confirmed US-made large-engine cars would have more access to Vietnam.

Yet, according to a leading apparel businessman, Vietnam is not a rival to Bangladesh because the garment items that country exports to America are different from those of Bangladesh. But it is a fact that if 50 per cent tariff is enforced on export of garments to the US, smaller factories here will collapse and even the larger ones will have to incur losses no matter if they have to share half of the duty burden with US brand companies. The problem will be acuter if Bangladesh's competitors like India and Pakistan clinch deals at lower tariff rates with buyers moving away to those countries. Even if the meeting with the USTR yields no positive results, it would be wise to include seasoned leaders of the garment sectors and use their US connections as a lobby in favour of Bangladesh.

There is still three week's time.​

 

[Saif]

Two per cent tariff cut is disappointing

Following all the talks and discussions over the last three months, the imposed reciprocal tariff has come down from 35 per cent from 37 per cent

en.prothomalo.com

Two per cent tariff cut is disappointing
Mustafizur Rahman
Updated: 09 Jul 2025, 22: 29

CPD's Distinguished Fellow Mostafizur Rahman speaks at a programme ERF organised at its office at Purana Paltan in Dhaka on 26 December in 2023 Prothom Alo

The Bangladesh government started discussions right after the US declared reciprocal tariff on Bangladeshi products on 2 April. Our chief adviser wrote to the US president where we urged for some concessions. The commerce adviser also spoke to them.

The government even offered duty concessions on certain products that might benefit the US in the annual budget for the 2025-26 fiscal. Apart from that, we continued talks on the non-tariff barriers mentioned by the USA, including complications in investment and implementation of the intellectual property law.

Following all the talks and discussions over the last three months, the imposed reciprocal tariff has come down from 35 per cent from 37 per cent. In other words, we could not yield that much from those discussions and talks.

As part of the tariff discussions, the United States had sent a draft of a framework agreement, but we have no idea what it contained. We do not clearly know what the US demanded and what it offered in return, nor do we know what Bangladesh asked for and what it offered in exchange—none of these four aspects are clear to us.

After Trump imposed reciprocal tariffs, we had the impression that Bangladesh was the very first among all countries to begin discussions. But after three months of talks, all we have learned is that tariffs have been reduced by just 2 per cent. That is undoubtedly disappointing.

The government has stated that the draft agreement included a non-disclosure clause. However, I believe the government could have formed a special team comprising stakeholders and experts to handle the negotiations. If our strategy had been shaped through discussions with such a team, it could have been more effective. But what we saw was that only a small group of people handled the matter, and in the end, it appears to have brought no real benefit.

The new tariff rate imposed by Trump is quite concerning for us as our main competitor Vietnam has succeeded in bringing down the new tariff rate to 20 per cent, which is 15 per cent more than us. It will result in a massive blow for the readymade garment industry of the country. It is hard to say how much of this additional duty foreign buyers will be willing to bear. It is likely they will try to pass the burden onto our exporters. But staying competitive with such a significant tariff gap is extremely difficult.

Overall, it can be said that the newly imposed reciprocal tariff has created a big threat for us. For this reason, we may lose our competitiveness in the short term. And if the tariff remains in place, our buyers could start turning elsewhere in the medium term. Since the United States is a major importer, we must continue engaging in dialogue with them. The US has announced that the new reciprocal tariffs will come into effect from 1 August, so over the next three weeks, we need to assess what more we can offer them.

Various geopolitical and economic factors are also tied to the trade discussions—things we are not privy to. Now we need to consider how much Bangladesh can realistically offer, as being a member of the World Trade Organization (WTO) imposes a range of restrictions. From that perspective, many options may not be feasible for us. Therefore, we must proceed with careful consideration of these issues.

We must certainly make efforts to reduce the tariffs. If we can bring them down to at least the same level as Vietnam's, we will be in a fairly manageable position in terms of competitiveness. But if the 35 per cent tariff remains in place, it will likely become very difficult—or even impossible—for us to cope with the situation.​

 

[Saif]

CA’s involvement sought in tariff talks

The country’s readymade garment manufacturers have sought the involvement of the interim government’s chief adviser, Professor Muhammad Yunus, in tariff talks with the United States...

www.newagebd.net

CA’s involvement sought in tariff talks
Saddam Hossain 09 July, 2025, 23:56

Professor Muhammad Yunus

The country’s readymade garment manufacturers have sought the involvement of the interim government’s chief adviser, Professor Muhammad Yunus, in tariff talks with the United States.

They also urged for an appointment with the chief adviser, where they would request Yunus that he should appoint lobbyists to address the newly imposed 35 per cent tariff on Bangladeshi goods exported to the US.

Currently, Bangladeshi RMG exporters enjoy a tariff of about 15 per cent-16 per cent in exporting to the US.

According to Otexa data, the US imported apparel items from Bangladesh for $7.34 billion, a lion share of Bangladesh’s total export value to the market, in 2024.Bangladesh-themed souvenirs

Mahmud Hasan Khan Babu, president of the Bangladesh Garment Manufacturers and Exporters Association, said that they would request the chief adviser to appoint a lobbyist to strengthen Bangladesh’s position in tariff negotiations and to persuade Washington to lower the rate.

‘We want an effective solution with the help of the government and we request the chief adviser to involve himself in the matter,’ he added.

Earlier on Monday, US president Donald J Trump imposed a steep 35 per cent tariff on Bangladesh, along with 13 other countries, through letters to 14 heads of the states.

The rate would be effective on August 1 on top of the sectoral tariffs.

Meanwhile, the second round of tariff negotiations between Bangladesh and the US started on Wednesday.

Mahmud Hasan observed that the exporters who solely worked with the US would face a substantial blow due to the tariff hike.

‘It would be challenging to find new destinations for them and if they couldn’t manage it, incidents of closing factories and losing jobs would be imminent,’ he added.

He also said that if the tariffs of competitor countries were lower, the buyers would go with them.

Fazlee Shamim Ehsan, executive president of the Bangladesh Knitwear Manufacturers and Exporters Association, said on Tuesday that as Bangladesh’s negotiations with the US in this regard were still ongoing and they were hopeful that a positive outcome would be achieved.

Mohiuddin Rubel, managing director of the Bangladesh Apparel Exchange and former director of the BGMEA, said that Bangladesh needed to focus on reducing newly imposed tariffs and aligning them with those of its competitors to boost competitiveness.

‘By managing internal costs effectively and developing all other impacting factors, like continuing product innovation and diversification of new markets, we can strengthen the competitive edge and stimulate further growth,’ he added.

‘Some orders may relocate sources if lower costs than Bangladesh are offered, while the end users might reduce purchases due to the elevated expenses as well,’ he added.

Considering the 2024 import from Bangladesh, this tariff increase signifies an additional payment of $2.57 billion in tariff by the US importers.

In 2024, Bangladesh exported about $8.4 billion in goods to the US and Bangladesh imported US goods worth $2.2 billion.

Earlier, on April 3, the US had imposed a steep 37 per cent ‘reciprocal’ tariff on Bangladeshi exports, but on April 9, the US president declared a three-month pause on the tariff.​