Bangladeshi readymade garment (RMG) exports to the United States will now face a tariff rate of 36.5%, following the introduction of a new 20% reciprocal duty in addition to the existing 16.5% Most Favoured Nation (MFN) tariff.

The Bangladesh Garment Manufacturers and Exporters Association (BGMEA) has called for renewed negotiations with Washington to mitigate the potential impact on the country’s largest export market.

At a press conference held in Dhaka on Saturday, BGMEA President Mahmud Hasan Khan outlined the implications of the new US executive order on trade.

He noted that while the increased tariffs pose a challenge, there remains scope for partial exemption. If garments are manufactured using at least 20% raw materials sourced from the US, such as American cotton, the 20% additional duty will not be applied to the American content portion of the products.

“About 75% of our apparel exports to the US are cotton-based. This provides an opportunity to adjust sourcing strategies to lessen the burden,” said Mr Khan, speaking at the BGMEA complex in Uttara.

He praised the interim government’s role in navigating recent trade uncertainties and urged it to persist with talks. “Several countries are still negotiating trade or security deals with the United States. These negotiations, once concluded, could result in lower reciprocal tariffs,” he said.

The BGMEA president acknowledged a recent US decision to reduce Bangladesh’s additional duty rate from 35% to 20%, calling it a move towards a more level playing field.

The current 36.5% rate remains below China’s 46.5% and India’s 41.5% on comparable goods, he added.

Still, concerns persist. Mr Khan warned that the higher duty may escalate production costs and strain, especially small and medium-sized factories. He urged the government to support exporters through enhanced port efficiency, reliable energy supply, and a more facilitative customs regime.

“The industry needs targeted support to withstand the added pressure and remain competitive,” he said.