Bangladesh secures reduced 19% U.S. tariff, exemption for some apparel made with U.S. material

Trainees work at Snowtex garment factory in Dhamrai, near Dhaka, Bangladesh. (AP Photo/A.M. Ahad, File)

Bangladesh has secured a reduced 19 per cent U.S. tariff under a trade agreement signed between the two countries on Monday, granting exemptions for some textiles and garments manufactured with U.S. material.

Muhammad Yunus, chief advisor heading Bangladesh’s interim government, said Washington had “committed to establishing a mechanism for certain textile and apparel goods from Bangladesh using U.S.-produced cotton and man-made fiber to receive zero reciprocal tariff in (the) U.S. market.”

The White House said Bangladesh had agreed to provide significant preferential market access for U.S. industrial and agricultural goods, including chemicals, medical devices, machinery and motor vehicles and parts, soy products and dairy goods, beef, poultry, tree nuts and fruit.

• Latest updates on international news here

Bangladesh will also ease non-tariff barriers by accepting U.S. vehicle safety and emissions standards, recognizing U.S. Food and Drug Administration certifications and removing import restrictions on remanufactured goods, the White House added.

The nations also noted recent and upcoming commercial deals including aircraft procurement, around US$3.5 billion in purchases of U.S. agricultural products, and an estimated $15 billion in U.S. energy product purchases over 15 years.

Yunus said the agreement followed nine months of negotiations that began in April last year.

Bangladesh also pledged to uphold internationally recognized labor rights and strengthen environmental protections.

• Trade War coverage on BNNBloomberg.ca

The South Asian nation in August had secured a reduction in U.S. tariffs on its exports to 20 per cent, down from 37 per cent initially proposed by Washington, offering much-needed relief to the nation’s apparel exporters.

The readymade garments sector is the backbone of Bangladesh’s economy, accounting for more than 80 per cent of total export earnings, employing about 4 million workers and contributing about 10 per cent to gross domestic product.

Bangladesh goes to the polls on Thursday to elect new leadership after being governed by an interim government since August 2024, when former Prime Minister Sheikh Hasina fled to India, where she remains.

---

Reporting by Nilutpal Timsina in Bengaluru and Ryan Jones in Toronto; Editing by Tomasz Janowski, Peter Graff and Mark Porter