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13th-Sep-2018

Export to US suffers setback

By

Special Correspondent :
Bangladesh's export to US market suffers setback due to high import tariff imposed by the US administration. This is also putting hold to a smooth trade and economic cooperation between the two countries, according to trade analysts and exporters.
The country's export to the US stood at US$ 5.68 billion in 2017, US$ 5.91 billion in 2016 and US$ 5.99 billion in 2015 and US$ 5.27 in 2014, according to the US Bureau of Census.
From January-July this year, Bangladesh's export to the US reached US$ 3.63 billion.  
However, the figure of the Bangladesh Export Promotion Bureau (EPB) shows that Bangladesh exported goods worth $ 6.0 billion in the US market in the past fiscal year (2017-18) and ready-made garments, footwear and headgear covered 95 per cent of the total export goods.
"Bangladesh's export to the US remained stagnant over the last couple of years due to tariff barriers. The US administration has imposed import tax disproportionately on local goods forcing the exporters to look for alternative markets to take comparative duty advantage," Dr Nazneen Ahmed, Senior Research Fellow of Bangladesh Institute of Development Studies (BIDS) told The New Nation yesterday.
She said apparel products accounts for over 85 per cent of Bangladesh's total annual export. If we look at the apparel export growth to the US market it remained insignificant whereas export growth of garment items to the European countries remained buoyant taking advantage of GSP facility.
 "GSP has played a big role in boosting the country's exports to the EU. Unfortunately,  the US authorities are not providing the facility to the local apparels which is ultimately affecting the export growth to the country," she added.
The US imposed an average 15.2 per cent duty and tariff of the value of all Bangladeshi shipments, which is the highest among all the importing nations.  
Dr Nazneen Ahmed further said Bangladesh has long been seeking duty-free market access for its garment items to the USA. But it remains a far cry for the country due to indifference of the North American country in this regard.
When asked, she said Bangladesh and the US signed TICFA agreement on 25 November 2013 to promote the bilateral trade and investment between the countries. "We're yet to see any outcome of the deal though the both countries are going to hold fourth round of TICFA council meet tomorrow."
Earlier, the US was providing GSP facility to 4,800 Bangladeshi products mostly unconventional items having negligible contribution to Bangladesh export basket. But it suspended the facility following the Rana Plaza building collapse.
"Traditionally, the US is the single largest export market for Bangladesh. Despite the fact, our export growth to this key market remained subdued mainly due to high tariffs imposed by the US," Prof Dr Mustafizur Rahman told The New Nation yesterday.
He said Bangladesh should engage an all-out diplomatic effort to convince the US administration over import tariff rationalisation for export growth.
"Bangladeshi exporters are the highest tariff payers among the 232 exporting nations to the US and such an uneven tariff is mainly responsible for the sluggish export growth," said Abdus Salam Murshedy, President of Exporters Association of Bangladesh (EAB).
He said the US is offering preferential tariffs or zero tariffs facilities to many Least Developed Countries (LDCs). But, Bangladesh has been denied of the facility though it still bears the LDC status. Even it denied of granting market access of local apparel products although we are demanding for it over a period of last 13 years.
"Our exports can grow significantly in the US market if the latter provides the trade privilege in favour of Bangladeshi garment items. The US authorities should take the issue seriously for strengthening Dhaka-Washington bilateral ties further," he added.