Experts urge competitiveness to tap US market potential

Experts stressed the need for Bangladesh to improve productivity, develop workforce skills, reduce business costs and diversify exports to unlock the untapped potential of the US market.
They made the observations at a seminar titled “The New Dynamics of Bangladesh-US Trade,” organised by the American Chamber of Commerce in Bangladesh (AmCham) as part of the 30th US Trade Show 2026, co-sponsored by the US Embassy in Dhaka, at a city hotel on Saturday.
The panel discussion was moderated by Mahbub Ur Rahman, CEO of HSBC Bangladesh. 
The panellists included Syed Nasim Manzur, president of FLAXA and managing director of Apex Footwear; Moinuddin Hasan Rashid, chairman and managing director of United Group; Shams Mahmud, managing director of Shasha Denims Ltd; and Ali Arsalan, country representative of COTTON USA.
Presenting the keynote paper, AmCham Bangladesh Vice President Ala Ahmad highlighted the importance of complying with international standards on labour rights, digital governance and intellectual property protection.
He also identified opportunities for expanding bilateral trade beyond the readymade garment (RMG) sector, particularly in agriculture, energy, digital services and technology.
Speaking at the seminar, Centre for Policy Dialogue (CPD) Distinguished Fellow Dr Fahmida Khatun said bilateral trade between Bangladesh and the US reached approximately US$13.7 billion in 2025, but there was considerable scope for further growth.
“I think there are a lot of opportunities. It can be even higher, given that we can improve our competitiveness through productivity, higher skills and reducing costs,” she said.
Referring to the Agreement on Reciprocal Trade (ART) signed between Bangladesh and the US on 9 February, 2026, Fahmida said the deal offered an opportunity to improve the country’s overall trade environment.
She said strengthening intellectual property rights, upgrading logistics and diversifying energy sources would help boost Bangladesh’s competitiveness.
The economist stressed that the agreement’s success should be assessed by its ability to generate revenue, attract investment, create jobs and improve productivity.
She also called for greater export diversification and government support for small businesses struggling with rising production and compliance costs.
Bangladesh must make the most of extended LDC transition
Fahmida said Bangladesh should use the extended transition period for graduation from the least developed country (LDC) category to strengthen its trade competitiveness rather than merely treating it as additional time to meet compliance requirements.
Bangladesh has secured a three-year extension of its LDC graduation deadline, moving it from 24 November, 2026, to 24 November, 2029, to facilitate a smoother transition amid risks arising from energy and supply disruptions caused by conflicts.
She said the additional time should be used to improve productivity, efficiency and compliance with international labour, environmental and social standards.
Fahmida also emphasised the need to reform the country’s tariff structure and strengthen domestic revenue mobilisation to prepare for the eventual loss of preferential trade benefits.
She urged Bangladesh to improve workers’ skills, protect intellectual property rights and pursue free trade and economic partnership agreements with major trading partners.
Meeting international standards and implementing necessary domestic policy reforms would help Bangladesh turn LDC graduation into an opportunity to strengthen its position in global trade, she added.
Long shipping delays hamper US cotton imports
COTTON USA Country Representative Ali Arsalan highlighted lengthy shipping times as a major obstacle to importing American cotton.
He said Bangladeshi garment manufacturers purchasing cotton from the US typically wait 90 to 120 days for delivery, tying up working capital and foreign currency while exposing importers to price fluctuations.
In contrast, suppliers from Brazil and West Africa can offer cotton already in transit, using shipping hubs such as Singapore and Port Klang to ensure faster delivery.
Arsalan identified Bangladesh’s letter of credit (LC) regulations as a key barrier, saying shipping documents cannot be dated before an LC is opened.
As a result, major global suppliers such as Louis Dreyfus and Cargill cannot load cotton onto vessels before a Bangladeshi mill formally opens its LC, a requirement that large companies are generally reluctant to accommodate because of the associated risks.
“Allowing documents for primary raw materials such as cotton to be dated before the LC would let US exporters ship sooner. That would cut lead times and keep foreign currency reserves from being locked up for long periods, even if it adds nominal costs,” he said.
He also stressed the importance of better inventory management, bonded warehousing and compliance systems to accelerate imports.
Arsalan noted that models successfully implemented in countries such as Turkey had struggled to gain traction in Bangladesh, underscoring the need for locally adapted solutions.

Footwear exports grow despite declining US imports
Apex Footwear Managing Director Syed Nasim Manzur said the US had emerged as Bangladesh’s largest single-country export destination for footwear, with shipments growing despite an overall decline in US footwear imports.
Citing data from the US Office of Textiles and Apparel (OTEXA), he said Bangladesh’s footwear exports to the US reached approximately $227 million in the first seven months of 2024.
While overall US footwear imports declined by 6.1%, imports from Bangladesh increased by nearly 27%. Cambodia recorded growth of approximately 37% during the same period.
Manzur said new US tariffs, particularly those imposed under Section 301, had given Bangladesh a modest competitive advantage over some major exporters, especially in leather footwear.
However, Vietnam, Indonesia and India had benefited more significantly, while Bangladesh continued to perform below its potential.
He said Bangladesh accounted for less than 1.7% of total US footwear imports and remained outside the top 10 suppliers overall.
However, the country had established a stronger position in certain product categories, ranking fifth globally in boots and ankle-high footwear under the cited classification and third in workwear and industrial footwear.
Bangladeshi manufacturers supply international brands such as Carhartt and Wolverine, he added.
Describing tariffs as a “double-edged sword,” Manzur said they could create competitive advantages but also increase compliance costs and demands for supply chain traceability.
He urged exporters to develop a better understanding of the US tariff system, noting that specialised US law firms could identify product modifications that substantially reduce applicable duties.
In some cases, relatively minor changes to product specifications could lower tariffs from 37% to 7%, he said, adding that Bangladesh lacked sufficient expertise in this area.
Trade agreement offers opportunities for apparel sector
Shasha Denims Managing Director Shams Mahmud said the US-Bangladesh trade agreement offered significant opportunities for the country’s apparel and textile exporters, but effective implementation would determine whether businesses could realise those benefits.
He said signing the agreement was only the first step, as mechanisms allowing exporters to claim duty benefits and apply value-addition formulas still needed to be made operational and effectively enforced.
“Execution is the challenge,” he said, calling for stronger coordination between government ministries and industry associations to translate the agreement into tangible commercial gains.
Mahmud also highlighted the traceability advantages of American cotton, saying buyers could track its origin to specific fields in states such as Texas and Alabama.
US cotton also comes with information on water and energy consumption, helping manufacturers meet increasingly stringent sustainability and supply chain transparency requirements.
He said these features offered an important compliance advantage for Bangladeshi exporters serving buyers in the US and European markets.