Muhammad Rafiuddin Haque writes on Bangladesh鈥檚 economy, cities and leadership in a changing world
BANGLADESH stands at a crossroads of global economic shifts, environmental imperatives and leadership tests. Global trade turbulence, driven by tariff wars and protectionism, is putting new pressures on Bangladesh鈥檚 export-driven economy. Simultaneously, rapid urbanisation and climate risks are forcing a rethink of how cities like Dhaka and Chattogram grow. Can they become 鈥渘ature-positive鈥� instead of concrete jungles? Underpinning both challenges is the need for adaptive, visionary leadership to guide the country through uncertainty. This article examines these intertwined issues 鈥� trade tensions, sustainable cities and leadership 鈥� and how Bangladesh can navigate the road ahead in the shadow of a rising India and an unpredictable world.
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Tariff turmoil and export challenges
AFTER decades of trade liberalisation, the world is witnessing a resurgence of protectionism. In 2023, global trade in goods and services expanded by only about 0.2 per cent 鈥� the slowest pace in five decades outside of a recession. Nearly 3,000 new trade restrictions were imposed worldwide in that year 鈥� five times the number seen just a few years earlier. These alarming trends, fuelled by populist and unilateral policies, are destabilising the rules-based trading system that emerging economies like Bangladesh rely on.
A stark example is the United States鈥� recent tariff escalation under its 鈥渞eciprocal trade鈥� agenda. In early 2025, the US imposed a steep 37 per cent tariff specifically on Bangladeshi garment exports 鈥� more than double the previous average. This puts direct pressure on Bangladesh鈥檚 ready-made garment sector, which constitutes over 80 per cent of the country鈥檚 total exports. The US remains Bangladesh鈥檚 largest single-country export market, accounting for roughly 17-18 per cent of total exports. In 2024, Bangladesh exported approximately $8.37 billion worth of goods to the US, the majority of which were apparel. The sudden tariff spike threatens to make Bangladeshi goods significantly less competitive for American buyers.
The impact is somewhat cushioned by similar tariffs on competitors 鈥� Vietnam faces a 46 per cent US tariff, Cambodia 49 per cent, and India 26 per cent. This broader protectionist sweep levels the playing field to some extent. However, analysts warn of larger ripple effects: if these tariff wars deepen, they could trigger retaliation, depress global trade flows and slow global demand. For instance, US imports from China are projected to decline sharply by 2030 under sustained protectionist policies, reverberating through global supply chains.
For Bangladesh, this global shift comes at a sensitive time. The country is poised to graduate from its Least Developed Country (LDC) status in 2026, at which point it will lose duty-free access to many key markets. In the European Union alone, average tariffs on Bangladeshi apparel could increase to around 12 per cent, eroding competitiveness.
Adding to the pressure, Bangladesh鈥檚 export growth has begun to slow. Contrary to earlier projections, RMG exports actually grew in 2023 鈥� reaching $46.99 billion, up 10.27 per cent year-over-year. However, the World Bank has downgraded Bangladesh鈥檚 GDP growth forecast to just 3.3 per cent for the 2024-25 financial year, citing weakened exports, sluggish private investment, and inflation-driven import restrictions.
The regional competitive landscape is also shifting rapidly. India, currently the world鈥檚 fifth-largest economy, is expected to become the third-largest by 2030. Its 鈥淢ake in India鈥� initiative, along with numerous bilateral and multilateral trade deals, aims to attract global manufacturers. Other countries like Vietnam and Turkey are also capturing a greater share of apparel and electronics exports.
To navigate these challenges, Bangladesh must prioritise resilience. Strategic responses include diversifying export products and markets beyond garments; boosting trade diplomacy to secure favourable trade agreements; improving domestic competitiveness by cutting red tape, enhancing port and transport infrastructure, and reviewing import duties; removing the 5 per cent tax on imported cotton, to reduce input costs and build goodwill with key trade partners; strengthening regional cooperation, particularly with India, in a balanced and mutually beneficial way.
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Towards nature-positive cities: lessons for Dhaka and Chattogram
AS GLOBAL headwinds buffet the economy, Bangladesh must also act closer to home 鈥� starting with its cities. Dhaka and Chattogram, economic lifelines for the country, face escalating environmental pressures: congestion, flooding, pollution and extreme weather.
The concept of 鈥渘ature-positive cities鈥� is gaining traction globally, envisioning urban areas that integrate nature into infrastructure and planning. Models from Singapore and Copenhagen show what is possible.
Singapore鈥檚 鈥淐ity in a Garden鈥� strategy has achieved nearly 47 per cent green cover across the city through widespread planting, vertical gardens and green rooftops. These features cool the city, absorb stormwater and improve public health. Crucially, this transformation stemmed from consistent, long-term government policy.
In Copenhagen, the devastating floods of 2011 triggered investment in green-blue infrastructure, including permeable parks, bioswales and water plazas. These natural features now channel and absorb stormwater while enhancing liveability and biodiversity. They have also proven more cost-effective than traditional drainage.
Dhaka, once laced with canals and wetlands, now faces seasonal floods due to unchecked urbanisation. A nature-positive strategy should begin by restoring these lost water bodies. Reviving canals, introducing rain gardens, and mandating retention ponds in new developments could dramatically reduce waterlogging.
Dhaka also suffers from a critical shortage of green space. Urban gardening, green rooftops and minimum open space mandates for new buildings could help reclaim liveability and climate resilience.
Chattogram, a coastal, hilly city, faces different risks 鈥� flash floods and landslides. Illegal hill-cutting and blocked canals have worsened vulnerabilities. Solutions include protecting hills and restoring vegetation, regular dredging and widening of drainage canals and establishing coastal green belts and restoring mangrove forests.
Urban resilience is no longer an optional luxury. Greener, more adaptive cities are foundational to Bangladesh鈥檚 long-term competitiveness and well-being.
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Leadership in uncertain times: guiding Bangladesh forward
ULTIMATELY, Bangladesh鈥檚 ability to weather global economic storms and build sustainable cities hinges on leadership 鈥� across government, business and civil society.
In an age of rapid change, the most effective leaders are those who balance adaptability with long-term vision. The pandemic underscored this, as companies that pivoted quickly while protecting core values emerged stronger.
Values-based leadership, too, is essential. Bangladesh鈥檚 transformation of its garment sector post-Rana Plaza, with world-class green factories and safety standards, is a clear example of turning crisis into opportunity.
The public sector has seen moments of commendable leadership as well: from the self-financing of the Padma Bridge to the country鈥檚 humanitarian support during the Rohingya refugee crisis.
Going forward, Bangladesh must nurture leaders who are strategic negotiators in trade and diplomacy, reformers in institutions and policies, marketers of Bangladesh鈥檚 brand to global investors and unifiers during times of political or economic uncertainty.
A pipeline of ethical, educated, globally aware leaders 鈥� not just in politics, but also in business, academia and civil society 鈥� should be a national priority.
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Conclusion
BANGLADESH faces a complex convergence of global protectionism, climate risk and geopolitical rivalry. Yet within these challenges lie opportunities for reinvention, resilience and reform.
To succeed, Bangladesh must diversify exports and expand trade diplomacy, rebuild cities with nature-based design for climate resilience and empower a new generation of adaptive, principled leaders.
The coming years will test Bangladesh鈥檚 institutions, policies and vision. But with courageous leadership, strategic planning and a commitment to sustainability, the country can not only survive global shocks but also thrive in a more competitive, interconnected world.
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Muhammad Rafiuddin Haque is a business analyst.
