SOHEL PARVEZ and JAGARAN CHAKMA

As the United States moves to impose reciprocal tariffs, concerns are mounting among Bangladeshi exporters, particularly in the footwear and pharmaceutical sectors, over potential implications for the country’s trade prospects.

Industry leaders say Bangladesh, which depends heavily on the US market as a key export destination, could have prepared earlier to mitigate the fallout. In contrast, others remain cautiously optimistic that the impact may be less severe than feared.

The new tariff measures -- the full details of which are yet to be revealed -- have sparked urgent calls for the government to engage in proactive economic diplomacy and undertake long-overdue trade policy reforms to safeguard Bangladesh’s competitive edge, especially at a time when global trade is already under pressure.

“The impact could be extremely serious. So, we need to engage and inform carefully,” said Syed Nasim Manzur, managing director of Apex Footwear Ltd, a leading footwear exporter in Bangladesh.

He said the US was the fastest-growing destination for Bangladeshi footwear in fiscal year 2021-22 and is one of the single biggest markets for bags.

Manzur, also president of the Leathergoods and Footwear Manufacturers and Exporters Association, said the US has been talking about imposing reciprocal tariffs since January this year.

“Unfortunately, we were in a kind of comfort zone and have not taken any measures. But a major competitor of ours was following this and was taking actions to minimise the possible impact of US tariffs on its exports,” he added. “We could have started preparations earlier as well.”

He said Bangladesh’s total tax incidence is one of the highest in the region, adding that it is high time for the country to rationalise import tariffs and para-tariffs, specifically supplementary duty.

Bangladesh’s average duties on US imports currently stand at 54 percent, but the rate goes up to 528 percent in the case of products like luxury automobiles.

“We must engage with the US administration and explain our position. This is a time for economic diplomacy,” he said. “We also need a clear roadmap with a short timeline for tariff rationalisation. In parallel, we must have clear plans to reduce the cost of doing business, and eliminating bureaucratic bottlenecks and corruption.”

In a welcome move, the National Board of Revenue has already initiated discussions on the issue.

“So, we are happy to see that the government has announced that it is reviewing tariffs for US products,” Manzur said.

Nasir Khan, managing director of Jennys Shoes Ltd, one of the country’s leading footwear exporters, said the US accounts for nearly 19 percent of Bangladesh’s total exports, making it a crucial destination for local manufacturers.

However, Bangladesh’s imports from the US are relatively modest, standing at around $2 billion annually.

“If we reduce import tariffs on US products, it will not have a significant negative impact on us,” Khan said. “On the contrary, if the US considers lowering tariffs on Bangladeshi exports, it could unlock fresh opportunities for our manufacturers.”

While acknowledging that the non-leather footwear segment relies on the US market, he noted that it is not as exposed as other major export sectors.