US President Donald Trump’s administration has proposed to impose additional tariffs on 60 countries, including Bangladesh, for failing to meet the target of reducing forced labor. Among them, 15 countries including Bangladesh have been told to impose 10 percent duty and 12.5 percent duty on the remaining 45 countries.
It is not yet a final decision, but the proposal has raised fears of fresh uncertainty in international trade. Economists say the new initiative could further complicate the global trade situation as the Trump administration’s counter-tariff debate continues.
The government is taking the matter seriously. Responsible officials of the Ministry of Commerce said that the US Department of Commerce will be contacted soon. On what basis Bangladesh has been included in this list, it will be formally inquired. If necessary, the matter will be discussed in detail through virtual or face-to-face meetings.
The Office of the US Trade Representative (USTR) made the proposal under Section 301 of the Trade Act of 1974. Under that section, the agency has the authority to investigate and take commercial action against foreign policies and activities that are harmful, unreasonable, or discriminatory to U.S. trade and economic interests.
The 10 percent temporary tariff imposed by the Trump administration on February 20 is scheduled to expire on July 24. Earlier, the USTR proposed new tariffs.
The U.S. Supreme Court’s decision has since that day revoked Trump’s authority to impose tariffs under the International Emergency Economic Powers Act.
According to USTR’s proposal, economies that have already banned imports of goods produced by forced labor or have committed to do so through trade agreements could face an additional 10 percent tariff on their goods. On the other hand, an additional 12.5 percent tariff has been proposed for economies that have not effectively enacted or implemented such restrictions.
The USTR included Bangladesh in a list of 15 countries accused of failing to ban and effectively control the importation of products produced by forced labor. The list includes Canada, Ecuador, the European Union, Indonesia, Mexico, Pakistan, Argentina, Bangladesh, Cambodia, El Salvador, Guatemala, Malaysia, Taiwan and the United Kingdom. An additional 12.5 percent duty has been proposed on the products of the remaining 45 countries.
According to analysts, the most important issue for Bangladesh is not the tariff rate, but the nature of the complaint. This is because, if the United States in the future enforces forced labor issues more strictly as a condition of trade, the pressure on export-dependent economies may increase. International buyers may be at risk of increased scrutiny, particularly around the ready-made garment sector.
Another important aspect of the matter is that it is not a direct action against a specific industry or product; Rather, it is presented as part of an overall trade policy, argued to stem the global flow of goods produced with forced labour.
According to the USTR, using forced labor to lower production costs distorts normal competition in global markets and exposes US producers to unfair competition.
The former chief economist of the World Bank’s Dhaka office. Zahid Hossain thinks that there is no opportunity to look at the matter lightly. According to him, this is not just a tariff proposal, but an effort to more deeply link labor and supply chains with trade. As a result, what is the basis of the complaint, on what facts Bangladesh has been listed and what kind of commercial impact it may have in the future – these issues need to be urgently looked into. At the same time, communication with the United States should be increased at both diplomatic and commercial levels.
According to analysts, the US has long considered the issue of forced labor as part of trade policy. For nearly a century, the country has banned the import of goods produced through forced labor through Section 307 of the 1930 Customs Act. As a result, the current initiative is seen as a continuation of a broader trade policy rather than an isolated step.
However, the country’s exporters directly rejected this complaint of USTR. Mohammad Hatem, the president of BKMEA, an association of net garment industry owners, told Ajker newspaper that there is no scope for using forced labor in Bangladesh’s labor law and industrial structure. Such labor practices have no real basis in any industrial sector of the country, including ready-made garments. According to him, the US administration has been looking for a new trade arrangement ever since the US Federal Court got tangled up with Trump’s counter-tariffs and the current proposal is part of that continuation.
BKMEA president said that if there is any specific complaint or information against Bangladesh, then it should be disclosed. He said, otherwise such accusations can damage the image of the country in the international arena. But there is no reason to panic about it. The government, BKMEA, BGMEA and the private sector will deal with the issue simultaneously in the interest of the country.
BGMEA, another association of garment industry owners, has taken a similar position. Mahmud Hasan Khan Babu, the president of the organization, said that it is very sad and unintended that the name of Bangladesh is associated with the allegations of forced labour. Currently, Bangladesh is one of the pioneers in the world in terms of environment-friendly factories, working environment and safety standards. As a result, such allegations are not consistent with reality.
Mahmud Hasan said, BGMEA is keeping a close eye on the matter. Necessary steps will be taken in consultation with the government. Besides, the support of international brands and buying organizations will also be sought, so that the labor standards and production reality of Bangladesh can be properly highlighted in the international arena.
Those concerned think that Bangladesh now has two parallel tasks. On the one hand, after verifying the reality and facts of the complaint, diplomatic objection should be raised. On the other hand, we need to emphasize our position more strongly on international labor standards, supply chain transparency and import-export control system. Because global trade is increasingly dependent not only on the quality of products, but also on the transparency of production processes, labor rights and supply chains.
According to data released by the USTR, about 99.40 percent of total U.S. imports come from the economies under investigation. As a result, trade analysts believe that this initiative can have a wide impact not only on Bangladesh, but also on the global supply chain, production network and international trade.
