Trump's tariff policy and risks for Bangladesh

US President Donald Trump announced the imposition of 'retaliatory tariffs' on America's trade partners, raising fresh concerns about international trade. 'Counter tariffs' imply that the United States will impose tariffs at the same rate as any country imposes on American goods. Trump's 'America First' policy aimed to reestablish the United States' dominant position in global trade, and the retaliatory tariff policy was a key part of that strategy. While the primary target of Trump's actions was China, other major economies like the European Union, India, and Mexico also fell within its scope. Alarmingly, developing countries like Bangladesh may also face the consequences of this policy. For an export-dependent economy like Bangladesh, this policy signals a looming crisis, especially as the country's primary export sector-the ready-made garment (RMG) industry-relies heavily on the US market.

The impact extends beyond the RMG sector; other emerging industries, such as leather, footwear, and pharmaceuticals, which have recently gained entry into the US market, are also vulnerable. Additional tariffs would stifle these sectors' growth and weaken Bangladesh's competitive standing compared to rival countries. To combat this looming threat, Bangladesh's policymakers must act swiftly. Strengthening diplomatic ties with the US and negotiating the restoration of GSP benefits should be prioritised.

Besides, Bangladesh must explore new markets in Europe, the Middle East, Africa, and Latin America while boosting exports in information technology, pharmaceuticals, leather, and agricultural products. Furthermore, empowering the youth by encouraging their involvement in trade, innovation, and market analysis could strengthen Bangladesh's economic foundation. Their technological skills, research-based knowledge, and collaboration with the government can help diversify exports and maintain stability.

Progga Das

Student, Department of Economics

Eden Mohila College

proggadas2005@gmail.com