Bangladesh’s Garment Sector Faces Crisis Due to U.S. Tariff Imposition

Staff Correspondent

The announcement of a 35 percent tariff on goods entering the U.S. market has come as a major blow to Bangladesh’s ready-made garment sector. As the main pillar of the country’s economy, this sector is heading toward a major crisis, the impact of which is expected to be far-reaching.

Last year, Bangladesh’s total exports to the U.S. amounted to approximately \$10.3 billion, of which \$8.5 billion—over 83 percent—came from the garment sector.

Former BGMEA president Rubana Huq said, when Vietnam exports products to the U.S. market with a 20 percent tariff, it will be difficult for us to remain competitive if we are subjected to a 35 percent tariff.

Mohiuddin Rubel, Additional Managing Director of Denim Expert Limited and former director, said there is already growing concern about the potential risks due to the imposition of a 35 percent tariff on all of Bangladesh’s exports. Since the U.S. is Bangladesh’s largest export market, the impact of this tariff could be extremely severe. In addition to the immediate risk of a decline in export orders, multidimensional challenges such as reduced employment and instability in the country’s economy may arise.

Experts say the consequences of this tariff will not only include a drop in export orders, but also major risks such as decreased employment, worker layoffs, and reduced foreign currency earnings in the country’s economy.

Among competing countries, Vietnam exports garments worth about \$18–20 billion annually, and India is also entering the U.S. market aggressively. Compared to them, Bangladesh is now facing a major tariff disparity.

Analysts believe that to overcome this crisis, urgent diplomatic efforts and high-level discussions with the United States are essential.

Earlier, Chief Advisor Dr. Yunus had sent a letter to U.S. President Donald Trump requesting tariff reduction. It goes without saying that the letter was completely unsuccessful.

However, Golam Mortoza, Press Minister of the Bangladesh Embassy in the U.S., claimed in a Facebook post that the 35 percent tariff is not a final decision. Discussions are still ongoing. The next meeting will be held on July 9.