Exporters to seek duty-free access for apparel made of US cotton

Entrepreneurs in the Bangladesh delegation currently in Washington will once again push for duty-free access to the American market for garments made from US cotton during the final round of tariff negotiations with the Trump administration today.

However, if that does not work, the Bangladesh government would try to negotiate a lower tariff rate from the proposed 35 percent.

Local apparel exporters have for many years been demanding that the US government allow duty-free market access for Bangladeshi apparel made from imported American cotton.

If the US government does not agree to zero duty, then retention of the existing 15 percent duty on all types of garments will also be acceptable, said Showkat Aziz Russell, president of the Bangladesh Textile Mills Association.

But not 35 percent, said Russell, one of the Bangladesh delegation members now in Washington. He, however, will not directly take part in the negotiations, since those are meant to be undertaken by government officials.

The delegation also includes two other businesspeople, one a major soybean importer and the other a liquefied petroleum gas (LPG) trader.

Bangladesh annually imports $4 billion worth of cotton, and only five percent comes from the US, said Russell.

Some $2 billion worth of cotton can easily be imported from the US in a year, as the quality is also higher than that from other countries, he said.

The import of a high volume of cotton from the US can reduce the bilateral trade deficit immediately, he also said.

Even a few years ago, the US used to meet 18 percent of Bangladesh's annual demand for cotton, said Russell.

But recently the US share decreased as local cotton importers, users, traders, and millers diversified their sourcing, especially from African countries, he added.

The price of US cotton is two to three cents higher than that of other countries because of its high quality, he said.

It takes more than 90 days to bring cotton from the US to Bangladesh, he said.

An LPG trader in Bangladesh, who is also on the way to Washington DC, said he would hold several meetings with American LPG exporters on the sidelines of the negotiations.

"I hope Bangladesh can import a lot of LPG from the USA to reduce the trade gap between the two countries," the importer said, asking not to be named.

He said local LPG traders have already become engaged in negotiations with US exporters to find ways to import LPG.

Another local billionaire in the Bangladesh delegation who is involved in commodity trade will also look into ways more US soybean could be imported to help reduce the trade deficit with the US.

Officials from the United States Soybean Export Council (USSEC) will also hold meetings with the Bangladeshi delegation, which includes the business representatives.

Moreover, a group of private sector negotiation initiators, mainly garment exporters focused on the US, is staying in the US to encourage their buyers to persuade Trump to reduce the tariff rate.

The Bangladesh delegation left the country on Monday to join the third and final round of negotiations with the Trump administration in the hope of reaching consensus on a much lower tariff rate on exports to the American market.

The third round of negotiations is scheduled to begin on July 29 and continue up to July 31, as Trump's new reciprocal tariff rate will come into effect from August 1 for the countries concerned.