Background

On April 2 at the White House, President Donald Trump announced that reciprocal tariffs would be suspended for 90 days—but a 10% surcharge would remain in place on all imports. This extra levy now adds directly on top of existing duties, creating a fresh cost hurdle for Bangladesh’s garment exporters.

Buyer Pushback

• Higher Overall Duty: Prior average duty of 14.1% would effectively rise to 24.1% with the extra 10% surcharge.
• Refusal to Absorb Costs: US buyers are unwilling to shoulder the entire increase, pressuring suppliers to cover at least part of it.
• Delayed Shipments: Where no agreement is reached, importers are delaying shipment approvals, disrupting delivery schedules.

Negotiation Process & Impact

• Major Brands Silent: Offices of Walmart, Target, Gap, Levi’s, PVH and others in Dhaka have so far avoided commenting.
• Cost‑Sharing Models: Most importers propose splitting the 10% extra—some agree to 8% themselves and shift the remaining 2% onto exporters.
• Production Holds: Importers warn they may suspend ongoing orders or decline new contracts without price concessions.

Industry Concerns & Preparations

• Producer Dilemmas: Manufacturers must balance cost‑sharing demands with quality maintenance and profit margins to secure future orders.
• DBL Group’s Stance: MD M.A. Jabbar notes buyers suggest sharing 5–10%; producers will decide based on capacity.

• Policy Appeals: Industry leaders, including Yunus Sir, urge suspension of the full 37% reciprocal tariff and report parallel measures in other countries.
• Efficiency Drives: Owners are accelerating investments in uninterrupted power and gas supply to offset added costs.

Retail‑Level Effects

• Slower Store Sales: Showrooms are managing stock more cautiously as end‑consumers worry about retail price hikes.
• Pressure on Suppliers: Anticipated higher retail prices further tighten buyer negotiations, squeezing exporter margins.

Key Statistics

• 2023 Exports to the US: USD 7.29 billion
• 2024 Exports to the US: USD 7.34 billion