Significant Threat to Bangladesh’s RMG Sector from New U.S. Tariff
Former BGMEA Vice President Rakibul Alam Chowdhury warned that the U.S. 37% tariff on Bangladesh’s ready-made garments threatens the sector’s viability. He noted that competitors, like India and China, have lower tariff rates, which could attract buyers away from Bangladeshi goods. Rising manufacturing costs and the need for policy reassessment are also critical points raised by Chowdhury.
On April 3, former Vice President of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), Rakibul Alam Chowdhury, issued a grave warning regarding the newly imposed 37% tariff by the United States on Bangladeshi ready-made garments (RMG). He articulated that this tariff presents a substantial threat to the RMG sector, especially as competitors such as India and China have lower tariff rates, which could undermine Bangladesh’s competitive position in the market.
Chowdhury emphasized that the financial burden of tariffs ultimately falls upon the buyers. Should the imposed tariffs elevate product prices beyond acceptable market levels for U.S. consumers, there is a risk that buyers may seek alternative suppliers, thereby diminishing demand for Bangladeshi garments.
Furthermore, he highlighted the ongoing challenges faced by Bangladeshi manufacturers, including rising production costs due to wage increases and inflation, which compound the difficulties of competing in the global market. Amid these challenges, he mentioned that discussions with buyers about maintaining existing orders are ongoing, indicating that both parties are seeking viable solutions.
Addressing the reciprocal 74% tariff imposed by Bangladesh on American products, Chowdhury pointed out that the country imports a minimal amount from the U.S. He criticized the high tariff rate as being unrealistic, stating that it contributed to the U.S. government’s implementation of the new tariff on Bangladeshi goods. Moreover, he called for the Bangladeshi government to reevaluate its tariff policies and foster diplomatic engagement to encourage the U.S. to repeal the recent tariff.
Without such measures, he warned that the future of Bangladesh’s RMG sector could be jeopardized significantly.
In summary, the newly imposed 37% U.S. tariff presents a critical challenge for Bangladesh’s RMG sector, as articulated by Rakibul Alam Chowdhury. The comparative competitive advantage of India and China, coupled with increasing manufacturing costs, further exacerbates the situation. Urgent reassessment of tariff policies and diplomatic engagement with the U.S. government are necessary to safeguard the interests of the Bangladeshi RMG sector moving forward.
Original Source: www.tbsnews.net
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