Bangladeshi exporters have expressed cautious optimism after US President Donald Trump on Friday announced a new 10% tariff, following a ruling by the United States Supreme Court that cancelled the previously imposed 20% reciprocal tariffs.
However, they warned that frequent changes in US trade policy are creating uncertainty in the market.
Commerce Secretary Mahbubur Rahman told TBS that after the Supreme Court cancelled the reciprocal tariffs, the trade agreement signed with the United States would also be cancelled.
Keep updated, follow The Business Standard’s Google news channelFollowing the court’s decision, Trump announced the imposition of a 10% tariff on all countries for 150 days.
If the 20% reciprocal tariff is cancelled and a 10% tariff is imposed for everyone, it is the lesser of two evils
Exporters said that although the new tariff still adds cost, it is lower than the previous 20% reciprocal tariff, which could ease pressure on US importers.
They said the removal of the higher reciprocal tariffs would allow US importers to source clothing at a lower duty. This could reduce retail prices of ready-made garments in the US market, potentially increasing consumer demand and creating scope for higher exports from Bangladesh.
Mahmudul Hasan Babu, president of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), said replacing a 20% reciprocal tariff with a uniform 10% tariff would be comparatively favourable.
“If the 20% reciprocal tariff is cancelled and a 10% tariff is imposed for everyone, it is the lesser of two evils,” he said.
“American importers will be able to import goods at a lower duty than before and sell at lower prices in the retail market. This may increase demand, and there is a possibility that Bangladesh’s exports will also increase.”
However, he said frequent changes in the US tariff policy were creating uncertainty among importers.
“Not knowing when the duty rate will be what – importers do not want to take the risk of importing. However, retailers will not keep their racks empty. They will import in smaller quantities. This might also lead to a decrease in exports,” he said.
AK Azad, managing director of Ha-Meem Group, said the cancellation of counter-tariffs could improve the purchasing power of US buyers, creating scope for export growth.
“With the cancellation of counter-tariffs, the purchasing power of US buyers will increase. This has created a possibility for exports to rise. Additionally, the new 10% tariff that the US president has announced will not have a negative impact on Bangladesh’s exports, because the reciprocal tariff was 19%,” he told TBS.
However, he expressed the view that the new tariff could face legal challenges within the United States, arguing that such measures may conflict with global trade rules.
https://www.tbsnews.net/economy/trumps-new-10-tariff-what-it-means-bangladesh-1367506
