Insights
- Bangladesh will raise trade barriers to its products in the US and urge the US for duty-free and preferential access on the sidelines of World Bank-IMF spring meet in Washington.
- A government brief for the meeting says though over 82 per cent of US tariff lines is ‘zero tariff’, it doesn’t cover Bangladesh’s exports.
- Dhaka may call for duty-free market access to its garments made from US cotton.
Bangladesh will raise the issues of trade barriers to its products in the US market and request the US government for duty-free and preferential access in talks with the latter on the sidelines of World Bank (WB)-International Monetary Fund (IMF) spring meet in Washington that begins today.
A Bangladesh commerce ministry brief prepared for the meeting says though more than 82 per cent of the total tariff lines of the United States is ‘zero tariff’, it doesn’t cover Bangladesh’s exports to that country.
In fact, Bangladesh’s exports to the United States faces a weighted average tariff of 15.2 per cent—among the highest. The average US tariff on knitwear items is 18.7 per cent and the non-knitted items is 15.8 per cent.
In contrast, US imports face quite low tariffs in Bangladesh; in fiscal 2023-24 weighted average tariff on US imports was only 1.62 per cent, the ministry brief says.
“We may urge the USA to provide duty-free market access as per the decision of the Hong Kong and Bali Ministerial decisions of the WTO,” the ministry says, stating that Bangladesh, despite being a least developed country (LDC), has been facing the highest duty among the US trading partners, a domestic media outlet reported.
“This is a significant trade barrier imposed on Bangladeshi products,” the ministry brief says.
Bangladesh may also urge the US authorities to provide duty-free market access to garment products made from US cotton, it adds.
Though cotton import in Bangladesh is duty-free, US cotton faces 16 per cent ad valorem tariff in the country. Earlier, Bangladesh decided to allow bonded warehouse facilities to ease US cotton imports.
Among challenges being faced by Bangladesh’s exporters to the United States are the suspension of the generalised system of preference (GSP) for Bangladesh in 2013 and application of 16.9-per cent most-favoured nation (MFN) duty on imports from Bangladesh, making it hard for an LDC.
The suspension remains in place despite Bangladesh’s initiatives along with Accord and Alliance to improve the compliance of the RMG factories which has already been recognized by the International Labour Organisation.
Bangladesh’s exports to the United States dropped by 17.68 per cent in January-March this year. Bangladesh may start negotiating with the US trade representative to sort out the issues and seek US investment to enhance supply-side capacity, upgrade technology and improve efficiency of mid-level managers, the official brief says.
The United States may also facilitate technology transfer to Bangladesh, the brief adds.
Source: https://www.fibre2fashion.com/