The United States collects more than $1 billion in tariffs annually on goods imported from Bangladesh, while Bangladesh earns only around $180 million in duties on American products, according to a new analysis unveiled by the Centre for Policy Dialogue (CPD).
At a dialogue held at the Lakeshore Hotel in Dhaka on Thursday (17 April), Professor Mustafizur Rahman, a distinguished fellow of the CPD, highlighted the stark disparity in trade duties between the two countries.
He noted that the average tariff levied by Bangladesh on US imports is 6.2%, which falls to a weighted average of 2.2% once rebates are considered. In contrast, Bangladeshi exports to the US face a weighted average tariff of 15.1%.
CPD observed that the total US duty on apparel imports from Bangladesh alone exceeds $1 billion—a significant cost to the country’s vital garment sector.
In response, the CPD recommended that Bangladesh closely monitor the impact of American tariffs on its export competitiveness, particularly in comparison with regional competitors such as Vietnam. It further urged the government to explore strategic avenues through the existing Trade and Investment Cooperation Forum Agreement (TICFA) to negotiate fairer terms.
One such strategy could involve Bangladesh requesting a list of American products for which the US would prefer duty-free or reduced-tariff access when exporting to Bangladesh.
However, the CPD cautioned that under the World Trade Organization’s Most Favoured Nation (MFN) principle, any tariff concessions granted to the US would need to be extended to all trading partners, potentially reducing government revenue depending on the product categories involved.
To address this challenge, the think tank proposed that a Free Trade Agreement (FTA) with the United States be considered, which could allow Bangladesh to offer reciprocal benefits without breaching MFN obligations.
Additionally, the CPD suggested that Bangladesh could explore the option of offering dedicated warehouse facilities for US cotton imports. Such a move might encourage negotiations on tariff waivers for garments manufactured in Bangladesh using American cotton.
