US President Donald Trump has announced the imposition of additional tariffs on export goods from 14 countries, including Bangladesh.
The United States has decided to impose a 35% reciprocal tariff on Bangladeshi products. Trump this week formally conveyed this decision through an official letter addressed to Dr Muhammad Yunus, chief adviser of the interim government.
If implemented, the newly announced tariffs would require Bangladeshi exporters to pay a total of 50% in duties, combining the existing 15% with the proposed 35%.
This development has raised serious concerns among Bangladeshi exporters and business leaders.
The 90-day tariff moratorium announced earlier by the White House is nearing its end, and the new tariff rates are set to come into effect on August 1.
Although the initial enforcement date was set for Wednesday, there remains a narrow window for negotiations with US authorities.
If successful, these talks may lead to a reduction in the proposed tariff rates; otherwise, the declared rates will be implemented as planned.
Notably, as early as March, the United States had already imposed at least a 10% reciprocal tariff on export goods from all countries.
According to data from the United States International Trade Commission, the average tariff rate on Bangladeshi products in 2024 stood at 15%.
With the imposition of an additional 35% retaliatory tariff, the total applicable duty would rise to 50%.
In effect, for every 100 units of value exported to the United States, Bangladeshi exporters would now be required to pay 50 units in tariffs.
Experts warn that such a steep increase in tariffs could severely undermine the competitiveness of Bangladeshi products in its largest export market—the United States.
Exporters have attributed this development to the absence of timely and effective negotiations with US authorities.
Mostafiz Uddin, managing director of Denim Expert Limited, Chittagong, told Bangla Tribune: “At a 50% tariff rate, US buyers would lose interest in sourcing apparel from Bangladesh. This could result in a significant decline in exports—not only to the US but potentially to European markets as well, where buyers may use this as leverage to negotiate lower prices.”
Frustration is growing among exporters due to the lack of progress in trade negotiations with the US.
While countries like the United Kingdom and Vietnam have already signed agreements and India is reportedly nearing a deal, Bangladesh has only recently entered formal talks.
Currently, Commerce Adviser Sk Bashir Uddin is in Washington to pursue negotiations.
Following the tariff announcement in early April, Yunus sent a letter to Trump requesting time, while Bashir also expressed interest in negotiations through correspondence with Jamieson Greer, the United States trade representative.
Although the USTR sent a formal proposal to Bangladesh in May, it yielded no tangible resolution.
This has led to growing speculation: Have the trade negotiations with the United States failed?
The announcement of a 35% reciprocal tariff under the US’s retaliatory trade policy has sparked widespread concern and disappointment across Bangladesh.
Observers are now questioning the effectiveness of Dhaka’s diplomatic efforts.
An analysis of the situation reveals that a lack of timely preparation, insufficient lobbying and a shortfall in strategic foresight have turned what began as a promising negotiation into a disappointing outcome.
Following the April 2 announcement, the US granted a 90-day deferment period, creating a window for Bangladesh to engage in negotiations.
While the initial weeks saw prompt letter exchanges and virtual meetings, talks reportedly slowed down in June and July.
According to several government sources, Bangladesh misinterpreted “positive signals” from Washington as an indication that time was on its side, ultimately leading to complacency and stalled discussions.
Has Bangladesh forfeited its leverage?
Despite offering duty-free access to 100 Bangladeshi products, Dhaka failed to submit the relevant list on time.
Meanwhile, Vietnam quickly and clearly outlined its duty-free offerings, gaining a head start in negotiations.
This delay raised concerns in Washington regarding Bangladesh’s seriousness and preparedness.
The proposed US reciprocal tariff agreement included conditions that contravened World Trade Organization (WTO) principles.
For instance, products granted tariff waivers by Bangladesh for the US could not be similarly extended to any other country.
Moreover, Bangladesh would be required to follow any US-imposed trade sanctions on other nations—a clause deemed restrictive.
Dr Mostafa Abid Khan, former member of the Bangladesh Trade and Tariff Commission, said: “Expecting additional benefits from the US under LDC status is unrealistic. Historically, the United States has shown little preferential treatment toward least developed countries.”
A lack of effective lobbying also contributed significantly to the failure in negotiations.
According to Anwar-ul-Alam Chowdhury Parvez, president of the Bangladesh Chamber of Industries, “It is nearly impossible to succeed in trade negotiations with the US without strong lobbying. Despite recommendations, the government did not act.”
While Vietnam adopted a proactive and strategic stance early on, Bangladesh largely fought a solitary diplomatic battle—squandering critical time in the process.
On June 28, the US embassy in Washington informed Bangladesh’s mission that a delayed agreement, after July 3, might still postpone the tariff imposition by up to a year.
This message led Dhaka to slow its negotiation efforts.
However, after July 3, the US formally notified Bangladesh of the 35% tariff decision, indicating a loss of faith in the negotiation process.
Hope still remains
Commerce Secretary Mahbubur Rahman commented: “The imposition of a 35% tariff amid ongoing talks is disappointing. However, negotiations are still underway.”
BGMEA President Mahmud Hasan Babu noted that a meeting had been held with the US ambassador, who conveyed that Bangladesh needs to be more serious and transparent.
This statement highlights the US’s firm stance from the outset and Bangladesh’s vulnerability to internal strategic confusion.
The US decision to impose a 35% reciprocal tariff on Bangladeshi goods poses a significant threat to the country’s export sector—particularly the ready-made garment (RMG) industry.
According to Mahmud, if the new tariffs come into effect on August 1, many factories that rely heavily on the US market will face export challenges.
He added: “From the beginning, we urged the government to initiate strong negotiations with the US, but we received only assurances and no real updates. When we asked what interests were being protected, we got no answers.”
Efforts are currently underway to meet with Yunus, he said.
Mahmud emphasized the urgency of appointing a US-based lobbyist and involving private sector representatives in negotiations before the new tariffs take effect.
He warned that inaction may signal unpreparedness to foreign buyers, potentially damaging Bangladesh’s reputation in global markets.
He said that exporters are calling on the government for a transparent and strategic response to prevent a collapse in exports.
Garment sector to be hit hardest
The RMG, leather and home textile sectors are expected to be the most affected.
The United States remains one of Bangladesh’s top export destinations, accounting for approximately $10 billion annually.
A 35% tariff would likely prompt many buyers to shift to alternative sourcing countries like Vietnam, Cambodia or Mexico.
Former BGMEA director Mohiuddin Rubel warned that the US tariff would endanger employment and competitiveness in the RMG sector.
He said: “This market accounts for 20% of our total apparel exports. Higher tariffs will make our products even less competitive in a market where we already operate without duty-free access.”
He urged the government to initiate immediate high-level trade talks and pressure policymakers through US importers.
“We must also highlight the strategic importance of our products to the US economy,” he added.
Failure to respond diplomatically and commercially could result in long-term consequences for the national economy, Rubel warned.
Economic fallout anticipated
Asif Ibrahim, former president of the Dhaka Chamber of Commerce and Industry (DCCI), expressed concern over the broader economic implications of the new US tariffs. “The RMG sector, which contributes approximately 85% of our total export earnings and underpins economic growth, faces a formidable challenge,” he said.
The absence of a free trade agreement already places Bangladeshi products at a competitive disadvantage. The added tariffs will further diminish their price competitiveness.
Numerous US-dependent factories could face closures, severely impacting workers—particularly female workers who are often the sole earners in their families.
Supporting industries such as packaging, logistics and small businesses would also face serious consequences.
Ibrahim stressed the need for the government to resume high-level negotiations with the US to secure either phased implementation or special waivers.
“This crisis reinforces the importance of diversifying our industrial base,” he noted, adding: “It is time to boost investments in leather and footwear, pharmaceuticals, IT services, agro-processing and the blue economy.”
He also recommended strengthening bilateral and regional trade agreements, warning that reliance on a single sector is unsustainable.
A well-structured strategic response is now essential to ensure long-term economic resilience.
Bangladesh–US bilateral trade overview
In 2024, the total bilateral trade volume between Bangladesh and the United States stood at approximately $10.6 billion, according to the Office of the United States Trade Representative (USTR).
Preliminary USTR figures show that the US exported goods worth $2.2 billion to Bangladesh in that year, down by 1.5%—or about $34 million—from the previous year.
Conversely, Bangladesh exported goods worth $8.4 billion to the United States, marking a 1.1% increase—or $89.3 million—compared to 2023.
Ready-made garments account for more than 85% of Bangladesh’s exports, and the United States remains the country’s single largest export destination.
Data from the Export Promotion Bureau (EPB) and the National Board of Revenue (NBR) show that in FY2024–25, Bangladesh exported goods worth approximately $8.69 billion to the United States—representing 18% of total export earnings.
Of this, over 85% comprised garments, alongside home textiles, leather footwear, caps, wigs and other leather products.
However, the Trump administration’s recent imposition of high tariffs on 14 countries—Bangladesh included—has dealt a severe blow to the export-oriented RMG sector.
While some countries have received temporary exemptions until August 1, Bangladesh is not among them.
Analysts believe this additional tariff will negatively impact both export capacity and market competitiveness.
In addition to garments, leather goods and other sectors also face potential risks under this new regime.