Bangladesh–US Bilateral Trade Breakthrough
After nine months of negotiations and bargaining, the reciprocal trade agreement between Bangladesh and the United States has been made public. Government analysts say the phased benefits outlined in the agreement will strengthen the country’s export sector and help maintain the competitiveness of Bangladeshi products, including ready-made garments, in the US market.
Details of the agreement were disclosed on Sunday, February 15, by the Press Wing of the Chief Adviser. According to the released information, the Bangladesh–US trade agreement places significant emphasis on establishing permanent policies in e-commerce and advancing digital trade.
The government stated that the Ministry of Commerce led the implementation process, with active participation from the National Board of Revenue, relevant ministries, and the Bangladesh Embassy in Washington. The agreement encompasses a broad range of areas, including trade in goods and services, customs procedures and trade facilitation, industrial policy, sanitary and phytosanitary measures, technical barriers to trade, investment, e-commerce, government procurement, labor, environment, competition, transparency, and mutual cooperation.
Under the new agreement, the retaliatory tariff imposed by the United States on Bangladeshi exports has been reduced by 1 percent. As a result, the tariff rate on Bangladeshi goods has decreased from 20 percent to 19 percent. Additionally, garments produced in Bangladesh using cotton and synthetic fibers imported from the United States will no longer face retaliatory tariffs when exported back to the US. In other words, apparel manufactured with US-origin raw materials will enjoy full exemption from such retaliatory duties. Approximately 80 percent of Bangladesh’s total exports to the United States consist of ready-made garments.
Through the agreement, Bangladesh will receive duty-free access for 2,500 products in the US market. These include various pharmaceuticals, agricultural goods, plastics, wood products, and other items. On the other hand, 7,132 tariff codes have been included to grant duty-free benefits to US products imported into Bangladesh. Many of these tariffs will be reduced gradually, creating a particularly advantageous position for the country.
It has been stated that tariff concessions on US imports will be implemented in phases. In the first phase, tariffs on selected products will be reduced, followed by gradual reductions on additional products in subsequent years. This process is expected to strengthen the export sector in the long term and facilitate planning in the country’s industrial and manufacturing sectors.
According to the agreement, out of the total 7,132 tariff codes, the United States will receive varying degrees of benefits. Among these, tariffs on 4,922 products will be reduced to zero from the date of signing the agreement. Of these, 441 products already had zero tariffs. Furthermore, tariffs on 1,538 products will be phased out within five years—half reduced in the first year and the remaining half decreased equally over the following four years. Tariffs on 672 products will be eliminated within ten years, with half reduced in the first year and the remainder gradually lowered over the next nine years. However, 326 products have not been granted duty-free benefits. These include certain tariff codes also covered under the agreement between Japan and Bangladesh.
The agreement incorporates provisions for permanent e-commerce policies, protection of international intellectual property rights, facilitation of food and agricultural imports, investment in medical equipment and industrial sectors, environmental protection, updates to labor laws, and digital trade. It also addresses national security measures, approval timelines for agricultural imports, recognition of US certifications, and compliance with commercial terms. The agreement stipulates that neither party can unilaterally withdraw from it, although Bangladesh has included a conditional exit clause.
Government analysts believe that the Bangladesh–US reciprocal trade agreement will help maintain competitiveness in export markets, attract foreign investment, and enhance economic stability. The government expects the deal to expand the garment sector as well as other export industries, bringing long-term benefits to the national economy.
DBTech/SMEH/DHE/OR
