- Bangladesh is looking to secure a more favourable tariff deal from the US, less than two weeks after the superpower announced that there would be a 20% tariff on exports.
Commerce Adviser SK Bashir Uddin said on Tuesday that there is a collective effort from all levels of government to reduce the reciprocal tariffs to 15%.
Why it matters
- Exports of readymade garments (RMG) make up the largest chunk of Bangladeshi exports, and Bashir also said they are hiking up export targets by 16.5% to $63.5 billion in the current fiscal year.
- The US is Bangladesh's single-largest export destination, and apparel exports make up around 80% of Bangladesh's export earnings.
- Bangladesh is currently the third largest garment exporter to the US, with a 9.3% share of the US apparel market.
- By negotiating down the tariff rate to 20% on 31 July, Bangladesh went a long way to ensuring that they could keep pace with their biggest rivals in the US market – China, Vietnam and India. A further 5% reduction could give Bangladesh the edge.
Zoom in
- The US on 7 August announced that it would impose an additional 25% tariff on India because of the latter's import of Russian oil, bringing the combined total to 50%, the joint highest among all countries so far.
- Chinese exports to the US will be taxed at a rate of 30%.
- The tariff on Vietnamese exports was reduced from an initial 46% to 20%, the same as Bangladesh. However, if China tries to reroute their goods through Vietnam, those would face a 40% tariff.
Zoom out
- On 2 April 2025, US President Donald Trump abruptly announced the unilateral imposition of higher tariffs on imports from 150 countries under a new "reciprocal tariff" policy.
- On the same day, an executive order issued from the White House set tariffs on Bangladeshi products as high as 37%, a sharp increase from the previous average US tariff rate of just 15.3% on Bangladeshi exports.
- Although the United States had planned to implement this new tariff policy starting April 9, it was postponed for three months, until July 9, due to objections from several countries, including Bangladesh.
- On June 28, it was announced that the tariff rate would be reduced to 35% based on the outcome of the talks and that it would take effect from August 1.
- The interim government held three rounds of talks with members of the Trump administration, with the last one ending on July 31, after which the 20% tariff was announced.
What they said
- "There is a collective effort from all levels of the government to bring down the tariff from 20% to 15%. Discussions with the United States are still going on, and the adjustment could happen before the final agreement is signed. We cannot confirm anything at this point, as the final decision ultimately rests with the US authorities." – SK Bashir Uddin, commerce adviser. a
2) CA wants Malaysian door to remain open for Bangladeshi workers
On the first day on a three-day trip to Malaysia, Chief Adviser Muhammad Yunus on Tuesday urged Malaysia to keep its doors open for Bangladeshi workers.
Why it matters
- Malaysia is a major destination of Bangladeshi migrant workers.
- According to Malaysian data, 8,98,970 Bangladeshis were working in the country as of May 2025 – the highest number among foreign nationalities after Indonesians and Nepalis.
- Remittance makes up more than 5% of GDP in Bangladesh, and is a major economic booster as it increases spending power of families.
Zoom in
- In July, the Criminal Investigation Department cleared the former expatriates' welfare minister, its former secretary, several MPs and a syndicate of 101 recruiting agencies of charges of human trafficking and money laundering.
- In the final report submitted to the Anti-Human Trafficking Special Tribunal, CID said the investigation has found no proof of the allegations.
- In April, the Malaysian Human Resources Ministry Secretary-General Datuk Azman bin Mohd Yusof wrote to Expatriates' Welfare Ministry Secretary Neyamt Ullah Bhuiyan requesting the review or withdrawal of the cases related to the labour recruitment in Malaysia.
- He called the allegations of human trafficking largely unsubstantiated, and that it harmed Malaysia's reputation.
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