The United States (US) collected $1.27 billion in tariffs on goods exported from Bangladesh in 2024 while Bangladesh earned $180.5 million in duties on product imports from the US, as per the United States International Trade Commission (USITC) and the National Board of Revenue (NBR).
Research by the Centre for Policy Dialogue (CPD) also pointed out that the US has a significant surplus in trade in services, rising from $77 billion in 2000 to $295 billion in 2024.
Experts at an event titled “Trump Reciprocal Tariffs and Bangladesh: Implications and Response,” organized by CPD on Thursday, suggested that signing a Free Trade Agreement (FTA) with the United States can be a long-term solution for Bangladesh's trade growth, as the country is the largest export destination for Bangladeshi goods.
Prof Mustafizur Rahman, distinguished fellow at the CPD, delivered the keynote presentation.
He said: “Bangladesh imposes customs and other duties averaging 6.2% on US imports. However, when rebates are taken into account, the weighted average duty drops to 2.2%.
“On the other hand, the weighted average tariff on US imports from Bangladesh stands at 15.1%. USITC and NBR data show that in 2024, $180.5 million in import duties were collected on imports from the United States. In contrast, the United States collected $1,273.19 million in tariffs on exports from Bangladesh.”
However, it has a significant surplus in trade in services, but Reciprocal Tariff (RT) considered only the US deficit in trade in goods but didn’t take into cognizance the US surplus in trade in services, he noted.
However, if Bangladesh offers tariff concessions to the US on certain products, it would be obliged to extend the same treatment to all trading partners under the most favored nation (MFN) principle.
Mustafizur Rahman said: “If the top three products imported from the United States were to be zero duty, other countries would have to be given equal benefits. This would result in Bangladesh's total duty loss of $170 million. As a result, this situation can be addressed by simply reducing duties, which is not the case.”
Export competitiveness
The CPD suggested that Bangladesh should closely monitor the impact of US tariffs on its export competitiveness, particularly in comparison with countries such as Vietnam.
It’s also stated that a free trade agreement (FTA) with the US could address such concerns.
It also recommended that Bangladesh explore strategic options, including engaging with the US through the Trade and Investment Cooperation Forum Agreement (TICFA).
The session was moderated by CPD Executive Director Fahmida Khatun and was attended by CPD Chairman Prof Rehman Sobhan.
‘China is the main target of the US’
Eminent Economist and Chairman of the CPD Prof Rehman Sobhan said: “The main target of US President Donald Trump's tariff policy is China. This will be the biggest issue in the global economy. In this climate, Bangladesh should find alternative export markets for the next five years.”
“We need to expand the export market to the European Union. We need to focus on the Asian market. Asia will be a big place for economic growth in the next 25 years. Along with that, we need to explore the markets such as Canada, Australia, and Japan,” he added.
Rehman Sobhan believes: “The uncertainty that has been created in the global economy due to Trump's tariff policy must be overcome.
“The bottom line is that the United States is the single largest market for Bangladesh's exports. If there is so much uncertainty there, we have to find an alternative.”
Speaking at the event, former member of the Bangladesh Tariff and Trade Commission Mostafa Abid Khan said: “First, we need to understand that this is not a reciprocal tariff. Therefore, no matter how much we respond, it won't be effective. What we really need to understand is what the United States wants. For that, discussions must continue.”
“The current option is to consider a Free Trade Agreement [FTA] with the US. However, reaching an FTA with the US is not easy. Every time we have tried, the US has said we are not yet ready,” he added.
Md Fazlul Haque, former president of the Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA) and managing director of Plummy Fashions Ltd., said: “None of the buyers are willing to change their price tags despite the imposition of a 10% duty.”
He also noted that as a result, order negotiations for the US market will likely slow down until the 90-day issue is resolved.
