United News of Bangladesh

Eminent economist and Chairman of the Centre for Policy Dialogue (CPD) Professor Rehman Sobhan on Thursday urged Bangladesh to seek alternative export markets to counter the uncertainty in global trade created by US President Donald Trump's new tariff policy. “The United States is Bangladesh’s largest export market. But the level of uncertainty there is now so great that we must adopt a strategy to increase exports to the European Union, Canada, Australia, Japan and emerging markets in Asia,” he said at a CPD dialogue. The dialogue, titled ‘Trump's Reciprocal Tariffs and Bangladesh: Implications and Response’, was held at a hotel in Gulshan, Dhaka. “Asia will be the biggest growth centre in the world economy over the next 25 years. If this region is not prioritised, we risk falling behind,” Prof Sobhan added. The keynote paper was presented by CPD Distinguished Fellow Prof Mostafizur Rahman, who highlighted that in 2024, the US collected approximately $1.27 billion in tariffs on Bangladeshi products, while Bangladesh received only $180 million in tariffs on US imports. “This issue cannot be resolved simply by reducing tariffs. In fact, such measures could lead to even greater tariff-related losses,” he said. Now US could collect over $1 billion in tariffs from Bangladeshi goods: CPD study The CPD underscored the importance of closely monitoring the impact of US tariffs on Bangladesh’s export competitiveness, especially in comparison with countries like Vietnam. It also emphasised the need to engage with the US through the Trade and Investment Cooperation Forum Agreement (TICFA). Prof Mostafizur also stressed the importance of pursuing a new trade agreement with the US administration and strengthening diplomatic engagement to address the challenges posed by Trump’s tariff policy. At the same time, Bangladesh must explore strategic alternatives, he said. Currently, Bangladesh imposes an average tariff and other duties of 6.2 percent on US imports, which drops to 2.2 percent when rebates are factored in. In contrast, US tariffs on Bangladeshi imports average 15.1 percent. Mustafa Abid Khan, former member of the Bangladesh Tariff and Trade Commission, said, “This is not a reciprocal tariff. We need to understand the US position and continue seeking a solution through dialogue. Signing a free trade agreement (FTA) with the US is not straightforward. They have repeatedly stated that Bangladesh is not ready yet. Speakers at the dialogue called for the development of a strategic commercial plan and greater export diversification in response to the imposition of counter-tariffs by the US. CPD Executive Director Dr Fahmida Khatun moderated the event, participated by representatives of trade bodies and labour leaders.

BNP on Wednesday urged the United States to maintain reciprocal tariffs on Bangladesh at a reasonable level to ensure smooth trade and economic relations between the two countries. “The economic aspects and the tariff issue came up during the discussions. We discussed Bangladesh’s perspective on the tariff matter,” said BNP Standing Committee member Amir Khosru Mahmud Chowdhury while speaking to reporters after a meeting with US Deputy Assistant Secretary of State for South and Central Asian Affairs Nicole Chulick. He said they told the US leader that the tariff issue must be resolved through discussions with all stakeholders. “We stated that our exports to the USA will be affected if the tariff is not kept at a tolerable level.” The BNP leader said they also voiced concern that the economic ties between the US and Bangladesh will be strained a bit. “On behalf of BNP, We have said what we’re going to do in this regard. We’re working on it further.” The visiting US official held a meeting with BNP Secretary General Mirza Fakhrul Islam Alamgir at the Gulshan residence of the US Deputy Head of Mission in Dhaka. Amir Khosru and BNP Organising Secretary Shama Obaed were also present. Khosru said they also discussed other issues of bilateral interest between the two nations during the meeting. BNP to attend talks with Consensus Commission Thursday He mentioned that they had an extensive discussion regarding Bangladesh’s upcoming national election, as the US side was interested in knowing when the election would be held and what the BNP’s position was on the matter. The BNP leader said they informed the meeting that their party wants the national election to be held by December this year. “We also said the election could be held even before December… we can outline the reforms on which a consensus will be reached within a month.” He said it is only a matter of time before all parties sign the July charter if a consensus is achieved. Khosru said the interim government's main responsibility is to complete all necessary steps to return to the democratic process. “There is no scope to delay the election for the sake of reforms.” He said they told the US official that decision-making in various areas, both domestically and internationally, is facing difficulties due to the absence of a restored democratic order.   “It is easier for an elected government, backed by public support, to take many important decisions. Those planning to invest from within the country or abroad are all waiting to see when an elected government will be formed and what its policies will be,” Khosru said. He also said the meeting included a detailed discussion on what the BNP’s policies would be, including their economic strategy. Khosru said they told the US Deputy Assistant Secretary that all the major reforms Bangladesh has undergone—economic and political—were introduced during BNP’s tenure. He mentioned that multi-party democracy and a free market economy were also established under the BNP’s rule. “The country’s economic prosperity has resulted from BNP’s economic reforms. In the coming days, we will pursue major economic reforms. They [the US] are convinced by our commitments.”

Business leaders and trade experts at a discussion on US tariffs on Saturday emphasised that strategic negotiations and industrial capacity building are crucial for Bangladesh to navigate tariff-related challenges. They stressed the importance of collective efforts from both the private and public sectors to resolve tariff issues with the United States. The observations came at a discussion titled “US Tariff on Bangladesh’s Exports: Reciprocal Strategies and Way Forward for Negotiation”, held at Gulshan Club. Speakers called for increasing the US content in manufacturing to 20 percent or more to qualify for a reduced tariff of 10 percent when exporting to the US market. Highlighting the high yield and low waste (only 9 percent) of US cotton, they suggested increasing imports of US cotton. The business leaders suggested that setting up US cotton storage facilities in Bangladesh should be explored, as it could help reduce import lead time and eliminate non-tariff barriers, thereby facilitating easier imports from the US. They also emphasised that Bangladesh can expand its exports to the US through product diversification and by encouraging US entrepreneurs to invest in the country’s industries. In addition to the government’s ongoing efforts in tariff discussions and Free Trade Agreement (FTA) negotiations, speakers highlighted the need to involve the US private sector in the dialogue. They further stressed the importance of strengthening infrastructure and industrial capacity, along with enhancing human resource skills, to help domestic industries remain competitive globally. While expressing optimism that the ongoing tariff war might create new export opportunities, they cautioned that without significant improvements in local capacity, Bangladesh might fail to capitalise on these prospects. Consensus Commission resumes talks with parties on reforms Saturday Speakers noted that major manufacturing countries have already begun relocating their industries in response to global trade uncertainties. Bangladesh should seize this opportunity by offering land, infrastructure, and supportive policies to attract global manufacturers. The discussion also called for enhancing the capabilities of government officials and upskilling human resources to better address these challenges and turn them to Bangladesh’s advantage. Key participants included Hafizur Rahman, Administrator of FBCCI; Abdul High Parker, President of Bangladesh Association of Banks (BAB); Anowar Hossain, EPB Vice Chairman and BGMEA Administrator; Anower-ul Alam Chowdhury Pervez, President of BCI; Zonaed Ahmed Saki, Chief Coordinator of Gono Sanghati Andolon; Shamim Ahmed, President of Bangladesh Plastic Goods Manufacturers and Exporters Association (BPGMEA); and Muhibuz Zaman, Managing Director of ACI Healthcare, among others. Shawkat Aziz Russel, President of BTMA, presided over the programme. Masrur Reaz, Chairman of Policy Exchange Bangladesh, made a presentation on the US tariff challenges facing Bangladesh. This issue is of major concern as the United States remains Bangladesh’s single largest export destination, accounting for nearly 20 percent of total Ready-Made Garment (RMG) exports, valued at US $7.34 billion in 2024. Unlike a flat tariff rate, US tariffs vary by country: China faces 145 percent, India 26 percent, Pakistan 29 percent, and Indonesia 32 percent. Bangladesh currently faces a 37 percent additional duty - higher than many of its competitors. This is particularly disheartening given that Bangladesh has been a consistent importer of US cotton for years, while countries like India import little to none. Based on this, Bangladesh’s tariff rate should logically be lower than India’s. The complexity is further deepened by a content-based adjustment mechanism that favours exports incorporating US-origin inputs.

Nobel Prize-winning economist Paul Krugman has criticised the imposition of high tariffs on imports of clothing from Bangladesh, calling it a wrong move. “Putting high tariffs on imports of clothing from Bangladesh is exactly what you shouldn’t be doing. That’s the kind of thing that is disruptive, raises the cost of living for American consumers, does nothing to make us more secure,” Krugman, who specialises in trade, told The New York Times during a recent interview. US reciprocal tariff move risks global trade disruption: ICC There may be a national security argument for domestic production, as well as for friendshoring and nearshoring, because goods that are closer are easier to secure. “But if that were our goal, we wouldn’t be levying tariffs on Vietnam and Bangladesh, and we certainly wouldn’t be imposing tariffs on Canada and Mexico,” he said. Krugman said that the trading system, which Donald Trump is now dismantling, was developed with a focus on both economic efficiency and a more enlightened, broader perspective on national security. Dr Yunus urges Trump to delay reciprocal tariffs on Bangladesh by 3 months He referenced Cordell Hull, F.D.R.’s secretary of state, who believed that strengthening economic links across the free world could promote solidarity among democracies and counter the threat of Stalinism. “So what we’re doing is tearing up — partially in the name of national security — a policy that was partially intended to enhance national security,” he added. There’s no question that the U.S. is alienating its allies — or its worthwhile allies — by doing all of this. And in some cases, they’re making common cause with our potential enemies,” he also said. Krugman also discussed the influence of political figures on trade policy, saying, “We have some direct evidence that’s what’s happened. Peter Navarro, who is sort of Trump’s trade czaar. I don’t know if he is still called that. But effectively, at least according to some of the reporting, he was recruited because they basically sent Jared Kushner out to search through Amazon and find somebody who had written books hostile to China.” Govt initiates talks with US over newly imposed tariffs: Finance Adviser He went on to say that One of the most interesting cases was Bob Lighthizer, a longstanding contrarian and protectionist voice in Washington. While many see him as a negative force in trade policy, he is respected for his expertise. People expected him to play a key role in the Trump administration, but he was overlooked. Likely because he is independent and didn’t align himself with Trump’s views. “So he might actually say to the king: No, not tariffs on Bangladesh.”

China's foreign ministry on Monday urged Canada to free an executive of telecom equipment giant Huawei Technologies held for more than a year as she awaits an extradition trial.