A delegation of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) met with a US trade delegation led by Assistant US Trade Representative (USTR) Brendan Lynch in a fruitful meeting. The US Embassy in Dhaka hosted this important meeting at the Chief of Mission Residence in Gulshan, a press release said.
The BGMEA delegation, led by BGMEA President Mahmud Hasan Khan, was also attended by Vice President RezwanSelim, Director Faisal Samad, Director Abdus Salam, and Chairman of the BGMEA Standing Committee on FTA and PTA, Lutfe M Ayub.
The meeting was attended by two other members of the US delegation, as well as Chargé d’Affaires of the US Embassy in Dhaka, Tracy Ann Jacobson, and Labor Attaché Leena Khan.
The meeting mainly discussed the issue of reducing countervailing duties on exports of goods from Bangladesh to the US and increasing cooperation.
BGMEA President Mahmud Hasan Khan said, “We have already achieved 20% tariff concession, which is a positive step. However, in reality, the average MFN (Most Favored Nation) tariff on exports from Bangladesh to the US market is 16.5% and the total tariff, including 20% countervailing duty, is about 36.5%, which has created new challenges for Bangladesh in exporting garments to the US. He drew the kind attention of the US Assistant Trade Representative to further reduce the tariff to ensure that the largest private sector employment generator, the garment industry, continues to export to the US market.
In this context, the BGMEA President expressed his opinion and said that this tariff can be coordinated with other products using the ‘stacking method’. This strategy will not only reduce the tariff burden, but also further increase the competitiveness of Bangladesh’s export products in the US market.”
The discussion also discussed a US executive order, according to which if 20% or more of US raw materials are used in garments exported from Bangladesh, then the 20% additional duty imposed on that product will be exempted on a pro rata basis.
The BGMEA leaders welcomed the initiative and said that the Bangladeshi garment industry is very interested in utilizing this opportunity. However, they wanted to know by what process or formula the assessment and traceability of the use of US raw materials will be ensured. In response, the US delegation said that the US Customs is currently working on the issue. It is hoped that it will be completed within the stipulated time.
The meeting also discussed the proposed amendment to the Bangladesh Labor Act 2006. The US Assistant Trade Representative said that it is highly expected that the labor law in Bangladesh will be reformed in line with international standards. He suggested amending the Bangladesh Labor Act 2006 following the ILO guidelines.
In this regard, BGMEA President Mahmud Hasan Khan assured the US Assistant Trade Representative on behalf of the garment industry that his board has started working towards this goal immediately after assuming office. His board has already held dialogues with 81 labor organizations on various labor-related issues.
He said that BGMEA is continuously discussing with all stakeholders on the amendment of Bangladesh’s Labor Act 2006. And to protect the industry and employment, specific proposals have been made in discussions with all stakeholders on the amendment of the labor law, giving importance to the country’s reality, industry context, institutional capacity and implementation capacity.
The BGMEA President requested the US Assistant Trade Representative to look positively at the positive changes that are gradually being achieved in the country and the industry.
The US trade delegation expressed satisfaction with the discussion and expressed hope that the countervailing duty rate for Bangladesh will be further reduced by increasing imports of Bangladeshi products from the US and reducing the trade deficit. The meeting ended with the meeting.
