![[FILE] Some of the attendees at the Bangladesh Apparel and Textiles Exhibition (BATEXPO) which brings together buyers, sellers and importers of the textile and apparel industry in Dhaka, Bangladesh, on November 5, 2009. EFE/ABIR ABDULLAH](https://pre.efe.com/wp-content/uploads/2025/07/rss-efe1092678c625f12e6cf29440b74bbcbc2074a5ec3w.webp)
By Indira Guerrero
New Delhi, July 20 (EFE).- As the US prepares to slap steep tariffs on Bangladeshi exports, the country’s vital textile sector faces a crisis that could shift global fashion dynamics and hand major European retailers a pricing edge.
One of the world’s top textile exporters, Bangladesh, now sees its flagship industry under pressure amid growing political turmoil.
This dual pressure notwithstanding, the sector also sees a window of opportunity for European buyers, particularly Spanish retail giants Inditex and Mango, industry insiders told EFE.
Spain’s pivotal role
The European Union is the top market for Bangladeshi garments, with imports reaching nearly $20 billion in 2024. Spain alone accounted for over $3.6 billion of that, led by Inditex, which operates some 250 factories in the South Asian country.
If exports destined for the US are diverted to Europe, the resulting supply glut could trigger a price war between Bangladeshi manufacturers, giving European retailers more negotiating power.
A 50% tariff wall
The crisis escalated earlier this month when US President Donald Trump announced a 35 percent tariff hike on all Bangladeshi goods starting August 1.
“With the existing 15–16% tariff, this brings the total to over 50%,” said Zahid Hussain, former chief economist at the World Bank in Dhaka.
That rate would severely undercut Bangladesh’s competitiveness against rivals like Vietnam, which has negotiated a stable 20 percent tariff with the US.
Finance Advisor Salehuddin Ahmed said the US rationale, its trade deficit with Bangladesh, is flawed. “Ours is just $6.2 billion, compared to Vietnam’s $125 billion. There’s no justification,” he said.
Geopolitics and pressure
Observers say Washington’s move is also about strategic leverage. “The US wants to pull Bangladesh away from China, both economically and militarily,” said one business leader who spoke on condition of anonymity.
But Dhaka’s current political vacuum complicates the matter. Nobel laureate Muhammad Yunus leads an unelected technocratic interim government, further weakening Bangladesh’s position at the negotiating table.
Industry on edge
The uncertainty has already begun to sting. Walmart and other American buyers have reportedly suspended orders, and industry analysts forecast a drop of up to 60 percent in US garment exports if the tariffs proceed.
Trade Advisor Sheikh Bashir Uddin said Bangladesh is offering concessions, such as increased US imports, to avoid the looming tariff cliff.
“We hope the US will set the tariffs at a rational level,” he said after the most recent round of talks.
With the Aug. 1 deadline approaching, a core segment of the global fashion supply chain is hanging in the balance, threatened by geopolitics, trade wars, and fragile governance. EFE
igr-sk