Washington’s growing use of “forced labour” provisions against Bangladesh is emerging as a major threat to the country’s export competitiveness, with economists warning that punitive tariffs could inflict economic damage while doing little to address underlying labour challenges.
Speaking at a briefing on Bangladesh’s economic outlook at the Centre for Policy Dialogue (CPD) on Thursday, Distinguished Fellow Professor Dr Mustafizur Rahman argued that the United States is increasingly using labour-related concerns as a trade instrument, placing Bangladesh under mounting pressure at a time when its export sector is already facing global uncertainties.
He warned that under the current tariff structure, Bangladeshi products entering the US market could face a combined duty burden of around 44%, significantly eroding the country’s competitive advantage.
“This is increasingly taking the shape of a political-economic strategy,” he said.
According to CPD estimates, Bangladeshi exports are currently facing a layered tariff structure comprising a 15% general tariff, an additional 19% agreement-related duty and another 10% linked to alleged forced labour concerns.
The result, economists say, is a tariff burden substantially higher than that faced by many competing exporters.
The warning comes after the Office of the United States Trade Representative identified Bangladesh among countries that have allegedly failed to take sufficient steps to eliminate forced labour, raising fears of further trade restrictions on Bangladeshi products, particularly garments.
Mustafizur argued that Washington’s assessment is based largely on its own labour framework and often overlooks the socio-economic realities of developing countries.
He said labour challenges in Bangladesh, including child labour in brick kilns and informal sectors, are primarily rooted in poverty, inadequate social protection and economic necessity rather than systematic forced labour as defined under international conventions.
According to Bangladesh Bureau of Statistics data, around 3.2 million street children live in the country, many engaged in informal work to support themselves and their families.
“Treating these complex realities solely through the lens of labour law violations risks creating policy misunderstandings rather than solutions,” he said.
The economist questioned the effectiveness of punitive tariffs as a tool for improving labour conditions.
“If the objective is genuinely to eliminate child labour and strengthen compliance, support funds, technical assistance and capacity-building would be more effective than trade penalties,” he argued.
He noted that a US court had previously struck down reciprocal tariff measures, but additional duties were later imposed through executive action. While some of those measures are due to expire in July, he warned that forced labour allegations could now be used to sustain similar pressure through alternative legal channels.
The stakes are particularly high for Bangladesh because the United States remains its single largest export destination, accounting for nearly one-fifth of total exports.
Economists warn that higher tariffs could reduce export orders, weaken foreign exchange earnings and ultimately affect employment in sectors that employ millions of workers.
Mustafizur cautioned that the consequences would extend beyond trade figures.
“This is not only an economic issue; it can become a social stability issue,” he said.
He urged immediate diplomatic engagement with Washington, arguing that Bangladesh should seek a more cooperative framework focused on improving labour standards rather than punitive trade measures.
According to CPD, failure to address the growing tariff challenge could leave Bangladesh facing a new generation of trade barriers at a time when global competition in export markets is becoming increasingly intense.
For Bangladesh’s export-driven economy, economists say the debate is no longer only about labour rights. It is increasingly about whether labour standards are becoming the latest battleground in international trade.