The United States is proposing to impose additional tariffs ranging from 10% to 12.5% on products from Bangladesh and 59 other countries. This initiative aims to reduce the import of goods made with forced labor. The US Trade Representative (USTR) has accused these countries of failing to effectively implement bans on such imports. The proposed tariffs could significantly impact US imports from these nations, including Bangladesh, China, the European Union, Japan, and others.
The USTR's proposal suggests that countries partially or fully banning forced labor products may face an additional 10% tariff, while those taking no action could see a 12.5% tariff. Reuters reports that Bangladesh and 14 other countries may face a 10% tariff, with the remaining 45 countries potentially facing a 12.5% tariff. The USTR has initiated investigations into these countries, citing failures under the 1974 Trade Act Section 301.
The US previously imposed retaliatory tariffs on Bangladesh and other countries, which were later reduced following negotiations. The current proposal follows a mutual trade agreement signed on February 9, which set the retaliatory tariff rate at 19%. However, the US Supreme Court deemed these tariffs illegal, leading to a new 10% tariff imposed under the 1974 Trade Act, effective from February 24. This new tariff is set to expire after 150 days.
The USTR has excluded certain products from the proposed tariffs, including fuels, rare minerals, specific metals, beef, coffee, certain fruits and vegetables, medicines, organic chemicals, and aircraft parts. The investigation into forced labor practices began on March 12, with the USTR finding that Bangladesh has failed to effectively ban and enforce restrictions on forced labor products. Bangladesh has made some commitments under the US-Bangladesh Enhanced Trade Agreement.
The USTR has set deadlines for affected countries to submit applications and summaries of testimonies by June 21, and written opinions by July 6. Additionally, the USTR is conducting another major investigation into the excess industrial production capacity of 16 trading partner countries, including Bangladesh, focusing on the ready-made garment and cement sectors.
