US Imposes New Tariffs on Bangladeshi Goods Amid Forced Labor Concerns

The Trump administration has imposed a 10% tariff on Bangladeshi products, citing concerns over the inadequate enforcement of prohibitions on goods produced through forced labor. This new tariff is in addition to existing duties, potentially raising the total tariff on Bangladeshi goods to 25%, from an average of 15%. Similar tariffs of 10% and 12.5% have been levied on products from approximately 60 other countries, including major competitors like India, Vietnam, and Indonesia. The U.S. Customs will collect these new tariffs as an additional charge on imports. While importers typically bear the tariff cost, significantly higher duties can discourage sourcing from affected countries. Exporters in Bangladesh have indicated that this new 10% tariff, imposed under the Trade Act of 1974, follows the suspension of a previous retaliatory tariff by a U.S. court. They note that the overall tariff rate hasn't changed, but express concern about a separate ongoing investigation by the Trump administration that could lead to further duties. The new tariffs, announced by the U.S. Trade Representative's Office (USTR) and published in the Federal Register, will exempt goods already in transit to the U.S. before July 28. The USTR stated that these measures aim to address human rights violations and trade distortions caused by forced labor, aligning with a long-standing U.S. ban on such products. Despite previous retaliatory tariffs that were eventually reduced and later invalidated by the Supreme Court, Bangladesh's exports to the U.S. increased by 4% to $9.04 billion in the fiscal year 2025-26. However, the uncertainty surrounding potential future tariffs and the ongoing investigations into excess production capacity, particularly in the ready-made garment and cement sectors, remain a concern for Bangladeshi exporters.