Bangladesh to sign trade deal with US in August

Bangladesh is preparing to sign an agreement with the United States this month that would impose an additional 20 percent supplementary duty on Bangladeshi products entering the US.

The agreement, once finalised, will be signed with the consent of both countries following any necessary revisions.

The United States Trade Representative (USTR) is currently drafting the agreement, a process the commerce ministry expects will take two to three weeks.

After that, the agreement may be made public, according to Commerce Advisor Sheikh Bashir Uddin.

Golam Mortoza, minister (Press Wing) of the Bangladesh Embassy in Washington, DC, confirmed to bdnews24.com that the agreement could take two to three weeks to finalise.

Following three months of negotiations, the United States last week reduced the supplementary tariff on Bangladeshi goods from 35 percent to 20 percent.

Previously, Bangladeshi exports had been subject to an average tariff of 15 percent.

With the new rate in effect, Bangladeshi goods will now face a combined tariff of approximately 35 percent when entering the US market.

Though the agreement has not yet been signed, the new tariff rate will apply starting Aug 7, as previously announced.

The United States has requested that the World Trade Organization be notified once the agreement is signed. Bangladesh will respond to the draft once it has been received.

Officials say the agreement will be signed only after both sides reach a consensus. A joint announcement from the governments of Bangladesh and the United States may follow.

In an interview in Washington on Friday, Bashir said the agreement’s details would be made public upon approval.

“After the agreement is signed, it will be published subject to the consent of the United States. A joint statement may come out soon after the agreement is signed,” he said, noting that the publication would be in line with the right to information.

As the agreement is under a non-disclosure arrangement, both governments are obligated to maintain confidentiality until the signing.

However, Bashir acknowledged that the agreement was “unfortunately” leaked during negotiations.

“There is nothing against the country’s interests there,” he said.

“I have clearly withdrawn from those things that may be indirectly against the country’s interests.”

According to the leaked information, the agreement includes provisions on tariffs, non-tariff barriers, facilitation of US product entry, particularly automobiles, transparency in revenue collection, increased use of technology in trade, labour rights in the garment sector, intellectual property enforcement, 20 percent value addition to garments, timely wage payments, trade union rights, national security, and efforts to address the trade deficit.

Citing national security, the United States has justified the countervailing tariffs and the confidentiality clause.

“What the United States basically got in return for the agreement is that they have used their national security,” the advisor said.

“The main regulator of the agreement has mentioned its own security. There is a condition of confidentiality in the negotiations.”

To meet the 20 percent tariff threshold, Bangladesh is expected to increase imports of wheat, LNG, food grains, cotton, and soyabean oil from the US, and purchase 25 Boeing aircraft.

However, the United States did not emphasise the Boeing purchase during negotiations, according to Bashir.

“During the trade talks or negotiations with the United States, I did not think that they took the issue of buying Boeing seriously. It was not discussed even once,” he said.

Noting that Boeing produced only 12 aircraft last year, Bashir said the first aircraft from this potential order may not be delivered until 2037. “They do not have that much capacity,” he added.

Instead, he said, the United States expressed stronger interest in agricultural and food exports. Bangladesh currently imports between $15 billion and $20 billion worth of food products annually from several countries.