Bangladesh prepares for third-round negotiation

Bangladesh now braces with preparation for a third-round tariff negotiations with the United States as hopes are yet alive for the lowering of a 35-parecnt duty wall built against its exports.

Commerce Adviser of the interim government Sk Bashir Uddin apprised reporters of the latest developments at a press conference held Monday at the commerce ministry upon his return from the second round of tariff negotiations with the USTR in Washington, DC.

The trade boss is hopeful about getting a positive outcome regarding the tariff issue on which negotiations can conclude before August 1, 2025 deadline.

A delegation from the Bangladesh side is expected to visit the USA middle of next week to resume the negotiations with the United States Trade Representative (USTR) to reduce the jacked-up tariff slapped on products exported to the US market from Bangladesh, said adviser.

He said, "We have sought time from the US for holding the third round of negotiations. We hope that the United States will set tariff that will be favourable for Bangladesh."

The commerce adviser holds the hope that Bangladesh will be able to continue business on the US market with the usual capabilities.

The last day of the second round of tariff talks was July 11 which began on July 09 at Washington, DC.

The adviser disclosed that Bangladesh has a non-disclosure agreement with the US on this matter. "As a result, it is not possible to tell the details of what the US wanted, or what we discussed at the last tariff talks."

Replying to a question as to what rate of US tariffs you prefer, the commerce adviser said, "We want zero tariff."

To another question on reported 40-per cent local value-addition condition proposed by the US, the commerce adviser and the commerce secretary both said they had no idea about or did not know about local value addition (LVA) threshold for some apparel items.

Despite asking a good number of questions by reporters, the commerce adviser did not answer many at the press conference. Citing the reason for parrying the queries, he said Bangladesh signed a non-disclosure agreement (confidentiality agreement) with the United States in this regard. So, it is not possible to give details.

Commerce Secretary Mahbubur Rahman said the tariff imposed by the US is a big shock to Bangladesh. That is why the government is working from all levels.

Mr Rahaman said some work had already been done, some more needs to be done. "Now we have discussed with the stakeholders. We took their opinions. We are prepared. We will discuss any issues that come up with the United States."

On July 07 last, the Trump administration declared a plan to impose 35-percent tariff on products exported to the US market from Bangladesh, beginning August 01, 2025.

To this end, US President Donald J Trump sent a letter to the Chief Adviser of the Bangladesh interim government, Muhammad Yunus. The new tariff is 2.0-percent lower than the initially declared rate of 37 per cent, issued three months ago, dated April 02 last. It was supposed to take effect from April 09.

The National Security Adviser and the Commerce Adviser of Bangladesh already sat in a meeting with the United States Trade Representative (USTR) representatives on July 03. The meeting ended sans decision.

In the meantime, various countries have signed bilateral agreements with the United States through negotiations. Bangladesh is also trying to strike a bilateral agreement. That is why a delegation led by the Commerce Adviser held several meetings with the USTR. However, Bangladesh and the US could not agree on all issues in the last talks.

Before the briefing, the commerce adviser had a consultation with stakeholders, leaders of the trade bodies, economists, businesspersons and senior officials.

BGMEA President Mahmud Hasan Khan, BKMEA President Mohammad Hatem, Bangladesh Chamber of Industries President Anwar-ul Alam Chowdhury (Parvez), Leather goods and Footwear Manufacturers & Exporters Association of Bangladesh(LFMEAB) and Apex Footwear Managing Director (MD) Syed Nasim Manzur, SANEM Executive Director Dr Selim Raihan, Policy Exchange Bangladesh Chairman Dr M Masrur Reaz, RAPID Chairman Dr Abdur Razzak, former Tariff Commission member Mostafa Abid Khan, FBCCI Administrator MD Hafizur Rahman and senior officials of the commerce ministry were among others present at the consultation meeting.

On behalf of the businessmen, BKMEA President Mohammad Hatem said, "The government is holding tariff discussions with US with utmost importance. We are satisfied with what the government has informed us about the discussions that have already taken place."

The third and final day of the second round of negotiations on the tariff issue between Bangladesh and the US concluded on July 11, 2025.

However, several issues remain unresolved in the tariff talks. Both nations decided to continue inter-ministerial discussions.

In the wake of the three-day talks, the trade adviser, Sheikh Bashir Uddin, and National Security Adviser Dr Khalilur Rahman are optimistic that a positive position can be reached within the stipulated time, according to a press release issued by the chief adviser office on July 12 last after the end of tariff talks.

The United States is Bangladesh's single-largest export-destination country, accounting for 17.09 per cent of total exports in FY 2023-24, according to the Export Promotion Bureau (EPB).

Bangladesh's top export item to the US is ready-made garments, which currently faces the most-favoured-nation (MFN) tariff rate of 11.8 per cent on knitwear and 9.91 per cent on woven garments.

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