Govt to hold talks with USTR over fate of trade deal

The government will hold talks with the United States Trade Representative (USTR) this week to determine whether the recently signed bilateral trade deal remains valid after America’s Supreme Court struck down a large swathe of President Donald Trump’s tariffs on Friday.

The US top court, in its ruling, declared that Trump had exceeded his authority under the International Emergency Economic Powers Act (IEEPA) by imposing sweeping reciprocal tariffs without congressional approval. The ruling limits the president’s authority to impose tariffs under the law, and it is unclear whether agreements concluded under that authority remain valid.

Speaking to The Daily Star over the phone, Commerce Secretary Mahbubur Rahman said, “Firstly, we will observe their position and status of the previous trade agreement with the US.”

“We will also hold stakeholder meetings with the local business community to let them know about the agreement and the latest situation,” he added.

The interim government signed the American Reciprocal Tariff (ART) agreement on February 9, just three days before national elections, committing Bangladesh to importing substantial volumes of American goods to narrow the bilateral trade gap.

The haste was deliberate. When President Donald Trump announced his “Liberation Day” tariffs in April last year, setting Bangladesh’s rate at 37 percent, Dhaka watched rival exporters such as Vietnam and China move quickly to negotiate lower rates. Bangladesh eventually secured a 19 percent tariff after signing the deal.

Two pressures drove the rush, according to Secretary Rahman. The tariff rates being offered to competing countries were uneven, and Washington was pushing for a quick signature before a new government took office and potentially stalled negotiations.

Now, with the US court ruling, the legal ground has shifted.

“We will have to talk with the USTR first about whether the already signed agreement will be cancelled or not, as the deal was signed in reference to the presidential power under IEEPA,” Rahman said.

Meanwhile, following the court ruling, Trump slapped a new 15 percent tariff on all US imports and ordered new trade investigations that could lead to additional levies in the coming months, while insisting that trade and investment deals reached with nearly 20 countries -- most with higher tariffs -- should remain untouched.

Dhaka is proceeding carefully. If the new 15 percent universal tariff applies equally to all countries, Bangladesh sees little urgency to re-engage.

“In that case, Bangladesh will delay in negotiations with the US,” said the secretary, noting that should discriminatory rates re-emerge, the government intends to move quickly to secure a lower ceiling.

“This time Bangladesh will not send any letter quickly as it did earlier, and the government will go slowly now,” he added.

The USTR, for its part, signalled on February 20 that it intends to press ahead with Trump’s trade agenda by other means.

In a statement, it noted that between April and December 2025, America’s goods trade deficit fell 17 percentage points from a 40 percent deficit, in part due to deals that kept protective tariffs in place while opening foreign markets to American exports.

The office said it would launch fresh investigations under Section 301 of the Trade Act of 1974, targeting practices it deems unfair, including industrial overcapacity, forced labour, pharmaceutical pricing, and discrimination against American technology firms.

“Our partners have been responsive and engaged in good-faith negotiations and agreements despite the pending litigation, and we are confident that all trade agreements negotiated by President Trump will remain in effect,” the USTR said.

The American Apparel and Footwear Association, in a separate statement issued on February 20, struck a different note, welcoming the court’s ruling and calling for swift refunds of tariffs it described as unlawfully collected.

“We are confident in Customs and Border Protection’s (CPB) ability to move quickly and provide clear guidance to American businesses on how to obtain refunds for tariffs that were unlawfully collected,” said Steve Lamar, the association’s president and chief executive.

“CBP’s recently modernised, fully electronic refund process should help to expedite this effort,” he added.