Bangladesh receives ‘lowest’ tariff rate under new US decision

Bangladesh has received the “lowest” tariff rate under a new US decision imposing levies on imports from 60 trading partners over the use of forced labour, the Ministry of Foreign Affairs said on Friday.

While Bangladesh faces the 10% tariff, several major global apparel manufacturing competitors, specifically China, Vietnam and Thailand, will face the maximum 12.5% tariff rate.

The government of Bangladesh said it remains fully committed to upholding international labour standards and will continue to engage closely with international partners to ensure the robust growth, compliance, and sustainability of Bangladesh's critical export sectors.

The US government on Thursday announced the imposition of tariffs under Section 301 of the Trade Act of 1974 on 60 economies representing 86 countries globally.

This measure comes after investigations conducted by the Office of the United States Trade Representative (USTR) regarding the use of forced labour.

Effective Friday, the tariff ranges from a low of 10% to a high of 12.5%.

This replaces the temporary 10% global tariff previously implemented under Section 122.

For Bangladesh, the tariff will be 10% on all imports originating from the country.

It will be applied in addition to existing Most-Favoured-Nation (MFN) tariff rates. Bangladesh is among the 17 out of 86 countries globally that have been placed under the lower 10% tariff tier.

Therefore, it retains Bangladesh's competitive standing in the US apparel and export market, said the ministry.

This distinct differential reinforces Bangladesh's ongoing comparative advantage in the US market relative to its high-tariff competitors, it said.

Additionally, the USTR is considering establishing a three-year Tariff-Rate Quota (TRQ) for four countries, including Bangladesh, Cambodia, Indonesia and Malaysia, to waive Section 301 tariffs on goods made from US cotton and textile inputs.

This, when implemented, will also provide Bangladesh further competitive advantage and promote Bangladesh’s exports to the US market.