Bangladesh may get reduced tariffs on exports to USA

“We are hoping the tariff will be lowered for us,” he said while emerging from the weekly meeting of the Advisory Council Committee on Government Purchase (ACCGP) held at the Bangladesh Secretariat.

Bangladesh will import some other essential items from the USA, he said, adding, “We will import some other essential items, but will not divulge the items names right now.”

The Adviser also said Bangladesh’s trade deficit with the USA is very low, like USD 6.5-7 billion.

Talking about the decision to import wheat from the USA, he said the government wants to rationalise the sourcing of wheat as part of increasing trade volume with the USA. “We have experienced uncertainty from the Russian and Ukraine blocks from where we usually bought wheat, there are problems in the black sea.”

He mentioned that negotiations with the USA are still on for the tariff lowering.

Regarding the price of wheat import from the USA market, Dr Salehuddin denied making any comment. “The protein level is a little bit higher in the wheat, but not very much higher, the impurity is much lower.”

He, however, admitted the price hike for this wheat import from the USA market. “But we will get some advantages and we need to import something for negotiation.”

Dr Salehuddin also mentioned that this import will be helpful to reduce the trade deficit.

The Finance Adviser said the Commerce Adviser will go to the USA shortly before August 1, the day to impose enhanced tariff rates for Bangladesh. “He will have meetings with the USTR; I am also talking through my channel.”

Dr Salehuddin said engaging lobbyists would not bring any positive result at this stage when the decisions are coming out very quickly.

Responding to a query to engage business people for this negotiation, Dr Salehuddin said that the business people will not get access in negotiation meetings. “They will have to make noise outside the meeting, that will not make any difference,” he added.

The adviser mentioned that it is true that the US private sector is very much important. “I have talked to the US Chamber, they have a good impression of Bangladesh,” he said.

US President Donald Trump on July 7 sent a letter to Chief Adviser Prof Muhammad Yunus imposing a tariff of 35% on products imported from Bangladesh.

In his letter, Trump cited a ‘longstanding and very persistent’ trade deficit between the two countries.

"It is a Great Honour for me to send you this letter in that it demonstrates the strength and commitment of our Trading Relationship, and the fact that the United States of America has agreed to continue working with Bangladesh, despite having a significant Trade Deficit with your great Country."

"Nevertheless, we have decided to move forward with you, but only with a more balanced, and fair, TRADE. Therefore, we invite you to participate in the extraordinary Economy of the United States, the Number One Market in the World, by far," the letter reads.

Trump also  said, "We have had years to discuss our Trading Relationship with Bangladesh, and have concluded that we must move away from these long term, and very persistent, Trade Deficits engendered by Bangladesh's Tariff, and Non-Tariff, Policies and Trade Barriers. Our relationship has been, unfortunately, not Reciprocal."

Trump's new 35% tariff announced for Bangladesh is 2% lower than the initial rate announced three months ago, but significantly higher than its close rival Vietnam (in the field of RMG), which recently secured a trade deal with the US under which its goods will be charged a tariff of 20%, reports UNB.