Bangladesh imposes very little tariffs on imports from the US, making the US government’s claims of 74% tariffs incorrect, CPD Distinguished Fellow Professor Mustafizur Rahman said Thursday.
Dhaka should use the TICFA meetings to promptly address misunderstandings and other issues with the world’s biggest economy, the senior economist suggested.
The US government hiked tariffs on Bangladeshi exported products, mostly ready-made garments, to US by 22% to 37% on Wednesday night, claiming the hike is a response to the 74% tariffs and other barriers Dhaka imposes on US imports into Bangladesh.
At the same time, US President Donald Trump announced sweeping tariffs on a range of other nations, sparking fears of widespread trade wars and a global recession.
Dr Mustafizur Rahman said Bangladesh’s major imports from US include scrap metal, petroleum products and cotton. Dhaka imposes no tariffs on scrap metal and petroleum. The cotton Bangladesh imports is reprocessed as apparel and shipped back to US.
Washington has a policy of relieving tariff burden on foreign products made with US raw materials, making Bangladeshi garments eligible for tariffs reliefs not hikes, Dr Mustafizur said highlighting the inconsistencies in Trump’s latest policy shift.
For its apparel sector Bangladesh imports cotton profusely from the US, making the South Asian nation America’s fifth biggest cotton importer. Almost 90% of Bangladeshi exports to the US are ready-made garments, produced in large part with US cotton.
Furthermore, the Trump administration has raised allegations of non-trade barriers being erected by Bangladesh against US imports into the country. The barriers include artificial foreign exchange rate to benefit Bangladesh at the cost of US interests.
Though artificial foreign currency exchange rates were prevalent in Bangladesh before, over the past three years, the central bank has gradually amended the policy to match market-set rates. Now, the taka-dollar rate is almost equivalent to market rates, Dr Mustafizur claimed.
These miscalculations and other issues should be resolved through dialogue under the TICFA platform, he said.
Courtesy: The Daily Sun
Bd-Pratidin English/ AM
