Mahmud Hasan Khan, President of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), on Thursday termed the inclusion of Bangladesh in a US investigation into overcapacity and overproduction in the manufacturing sector as "uncomfortable."
Reacting to the announcement by the office of the United States Trade Representative (USTR), the BGMEA president stated that there is "no logical basis" for including Bangladesh in the list of 16 countries targeted for the probe.
The investigation, initiated under Section 301 of the US Trade Act of 1974, aims to determine whether the policies, acts, or production structures of these countries are "unreasonable or discriminatory" and if they burden or restrict US commerce.
"Based on the USTR notice, it appears they will hold hearings to investigate unfair trade practices, labor rights violations, export incentives, and intellectual property rights (IPR) infringements," Mahmud Hasan Khan told reporters.
"If such allegations are proven, they may impose additional tariffs,” he added.
Despite the discomfort of being listed alongside economic giants like China, Japan, and the EU, the BGMEA President noted that he does not foresee a major challenge for the country’s apparel sector.
He noted that labor rights issues are already being addressed and the practice of IPR in local production is limited.
The BGMEA President argued that export incentives in Bangladesh are minimal. While questions might arise regarding agricultural subsidies, he pointed out that the US itself provides significant subsidies to its farmers, whereas Bangladesh primarily subsidizes fertilizers.
"The bulk of our exports to the US is readymade garments. US manufacturers are not producing the types of apparel we export, so we are not in direct competition with their local industry," he added.
The BGMEA chief suggested that the investigation might be an attempt by the US to protect its domestic industries and manage its massive consumer market. However, he urged the Ministry of Commerce to take proactive steps.
"Since Bangladesh has been named in the investigation, the government must take advanced preparations to handle the matter effectively during the hearings," Khan emphasized.
On Wednesday, US Trade Representative Jamieson Greer announced the investigation into 16 countries and entities. Besides Bangladesh, the list includes China, the European Union, India, Vietnam, Indonesia,
Malaysia, Cambodia, Thailand, South Korea, Taiwan, Mexico, Japan, Singapore, Switzerland, and Norway.
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