M Masrur Reaz, Chairman, Policy Exchange Bangladesh
Firstly, the 20% reciprocal duty is almost half of Trump’s proposed 37%, which provides some relief for the country at present and demonstrates that the negotiating capacity of the country’s commerce ministry has improved.
Secondly, due to the imposition of the 20% duty, end consumers will have to bear the additional cost, which may lead to a decrease in retail sales in the US market.
This could raise concerns about declining orders.
Therefore, apparel exporters should engage with US buyers, brands, and retailers to explore how additional cost can be managed — possibly through a cost-sharing mechanism.
In addition, to address future challenges such as LDC graduation and compliance requirements, exporters must increase their competitiveness and productivity by adopting advanced technologies without delay.
On the other hand, the government should find ways to reduce trade costs — particularly by improving transportation and handling capacity at ports, and by offering various forms of policy support.