Bangladesh has pinned its hope on the ongoing negotiation to avert 35 per cent US tariff on its exports threatened by president Donald Trump in a letter to chief adviser Muhammad Yunus on Tuesday.
Economists have warned that the newly proposed tariff can deal a major blow to the country鈥檚 exports as well as economy if Dhaka fails to convince Washington to cut the rate in the ongoing negotiation with the US Trade Representative.
Commerce adviser Sk Bashir Uddin, who flew to Washington on July 4, is leading the Bangladesh side against the USTR in the current negotiation scheduled to conclude on July 11.
Aided by national security adviser Khalilur Rahman,
Dhaka is expected to assure Washington of buying more US-made goods such as fruit drinks, military hardware, and Boeing aircraft as part of cutting the country鈥檚 trade deficit with the US.
On Tuesday, finance adviser Salehuddin Ahmed said that the proposed 35 per cent duty by the US on Bangladeshi export products was not a final settlement.
The final settlement will be done through a one-on-one negotiation, he told reporters at the secretariat in Dhaka referring to the ongoing negotiation with the USTR -- after a meeting of the advisory council committee on government purchase.
The finance adviser was answering questions from reporters regarding the US president Donald Trump鈥檚 letter sent to the chief adviser asking him to consider that the 35 per cent tariff was far less than what was needed to eliminate the trade deficit disparity between two countries.
In 2024, Bangladesh exported to the US about $8.4 billion in goods and imported from that country goods worth $2.2 billion, meaning that the trade deficit was $6.2 billion for the US.
鈥榃e 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鈥檚 Tariff, and Non Tariff, Policies and Trade Barriers,鈥� wrote the US president.
The US president warned of further dire consequences in case of Dhaka deciding to raise tariffs.
鈥業f for any reason you decide to raise your Tariffs, then, whatever the number you choose to raise them by, will be added onto the 35% that we charge,鈥� said the US president.
The US president also posted letters on his Truth Social platform unveiling higher tariffs for Japan, South Korea, and a dozen other countries, including Indonesia, Bangladesh, Thailand, South Africa and Malaysia.
These mark a step-up from the 10 per cent levy the president earlier imposed on almost all trading partners.
But the starting date of August 1 marks a delay in Trump鈥檚 re-imposition of higher duties, originally due from today.
Currently, Bangladeshi exporters enjoy a tariff of around 15 per cent in shipping their products to the US, the single largest export destination counting over 16 per cent of the country鈥檚 overall export of $50 billion in 2024.
Zahid Hussain, former lead economist at the World Bank鈥檚 Dhaka Office, said that Vietnam secured a flat 20 per cent tariff while Bangladesh faced a 35 per cent increase on existing sectoral tariffs.
鈥楥ountries like Indonesia and South Africa, which seemed not exactly favoured by president Trump, appear to have negotiated better deals than Bangladesh,鈥� he added, saying that among the 14 countries announced, only four are behind Bangladesh in negotiations.
Finance adviser Salehuddin said that Dhaka had scope to negotiate a fair deal from the Washington since the trade between two nations was not so big compared to others countries.
Mustafizur Rahman, a distinguished fellow at the Centre for Policy Dialogue, said that it was informed that Bangladesh was the first country to begin discussions with the USTR.
Yet, after three months of negotiations, the outcome is deeply disappointing, he observed.
Commerce ministry secretary Mahbubur Rahman the same day said that the final discussion over the tariff would be settled in meetings on July 10 and July 11.
Calling the latest tariff proposals an extension of the previous ones, he said that both the sides had held a number of meetings over the tariff issues.
He said that he had joined all the meetings virtually.
Dhaka鈥檚 main focuses for the upcoming meetings would be protecting the country鈥檚 interest in its single biggest export market, said the commerce secretary who is expected to join the negotiation in person today.
The commerce secretary said that they were already consulting the National Board of Revenue and other stakeholders regarding the US demand for reducing duties and Value Added Tax on certain products such as wheat, soya bean, aircraft, and machineries.
He hinted that Dhaka might announce buying new Boeing aircraft shortly.
In 2008, Biman Bangladesh Airlines signed a $2.1 billion agreement with the US company Boeing to purchase 10 new aircraft delivered by 2019.
Then national flag carrier Biman has now a fleet of 21 aircraft.