The recently signed United States-led Trans-Pacific Partnership (TPP) between 12 countries including Vietnam is likely to hit readymade garments exports to the US, the country’s single largest garment export destination. At present, Bangladesh pays 15.62 per cent duty for its garment exports to the US, whereas Vietnam pays 8.38 per cent. If the TPP is signed, garment exports from Vietnam will enter the American market completely duty-free and Bangladesh is set to lose its competitiveness in apparel trade, traders said. US currently imports RMG worth around $5 billion a year from Bangladesh, which with its $25 billion apparel exports is the second largest RMG exporters after China. However, Bangladesh’s garment exports to other nations of TPP like Canada, Japan, New Zealand, Australia and Chile might not be hampered, as it already enjoys zero-duty benefit to those countries. Vietnam will be a big beneficiary from the deal, but it cannot be estimated how much Bangladesh will lose every year as a result of the deal. The other members of the TPP are Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore. The TPP is a comprehensive agreement that will open markets, set high-standard trade rules and address 21st-century issues in the global economy. In so doing, it will promote jobs and growth in the US and across the Asia Pacific region. Bangladesh had been a strong player in raw material exports such as yarn, fabrics and fibres, it would have benefited slightly from the deal. The average tariff of Bangladesh is 55 per cent, which is too high for openness of the country’s business. Traders suggest to liberalise its tariff structure as some other countries have the opportunity to join the TPP in the near future.
