How U.S. Elections Could Impact Bangladesh Garment Exports

Dhaka — (BanglaLook) — Bangladesh’s ready-made garment (RMG) sector, which supplies major U.S. retailers and accounts for the lion’s share of national export earnings, faces a changing geopolitical and commercial landscape as U.S. trade and election politics reshape market access, tariffs and buyer sourcing decisions. Recent moves by U.S. trade authorities — including sharply higher reciprocal tariffs and targeted measures — plus rapid shifts in global sourcing since 2024–25 mean U.S. election outcomes and subsequent policy choices could materially affect Bangladesh’s exporters, workers and the national economy. (The Business Standard)

Quick snapshot (what’s happening now)

• Bangladesh’s apparel shipments to the U.S. grew strongly in 2025, with reports showing major year-on-year gains in H1 2025 as buyers diversify away from China. (The Business Standard)
• At the same time, the U.S. has introduced or threatened substantial reciprocal tariffs on apparel from several Asian suppliers; media reporting and trade sources show tariff proposals and negotiated outcomes that include very high nominal rates (reports cited 37% initially, with some negotiated downward outcomes for particular countries). These tariff dynamics are an immediate headwind. (Business & Human Rights Resource Centre)
• Diplomacy and trade deals (for example, trade concessions in exchange for imports of U.S. agricultural goods) have begun to feature in Bangladesh-U.S. discussions, showing the political dimension of trade access. (Reuters)

How U.S. elections change the calculus — three transmission channels

1) Tariff & trade policy (direct cost channel)

Presidential administrations and the U.S. Trade Representative (USTR) influence tariff policy and reciprocal-tariff programs. An administration that pursues aggressive reciprocal tariffs — or that fast-tracks protectionist measures — raises effective duty costs on exported garments. Even a modest nominal tariff can be amplified by existing base duties and rules of origin, substantially raising landed costs for U.S. buyers. In 2025 public reporting showed proposed U.S. tariffs that would have raised effective tariffs to levels that risk shrinking demand for exports priced at thin margins. (shenglufashion.com)

Impact for Bangladesh:

• Higher tariffs reduce price competitiveness versus countries not facing the same duties (or versus nearshoring options inside the Americas). Exporters either accept margin compression or pass costs to buyers — with uncertain demand responses. (The Daily Star)

2) Trade preferences, sanctions & conditionality (policy leverage)

U.S. trade policy increasingly links market access to labor, human-rights and national-security criteria. Preferential access programs, inspections, or suspensions based on labor standards can protect or restrict market entry quickly. The U.S. also uses bilateral leverage (e.g., negotiating import deals for U.S. agricultural goods in return for tariff relief) — showing that non-trade issues can determine trade outcomes. (Reuters)

Impact for Bangladesh:

• A U.S. administration with a stronger labor-rights/conditionality agenda could push tougher compliance requirements (factory inspections, wage floor measures), raising compliance costs but potentially locking in long-run buyer confidence. Conversely, a more transactional administration might prioritize short-term trade concessions in exchange for diplomatic or commodity purchases. (bd.apparelresources.com)

3) Buyer sourcing behavior & geopolitics (demand & diversification)

U.S. elections influence geopolitical posture (toward China, India, regional partners). Political signals — tariffs on China or incentives for nearshoring — steer large U.S. brands’ sourcing strategies. When suppliers in one country face punitive tariffs or policy uncertainty, buyers accelerate diversification. In 2024–25, part of Bangladesh’s export gains to the U.S. reflected buyers shifting away from China — but that dynamic can reverse if Bangladesh becomes a target of higher reciprocal tariffs or stricter conditionality. (The Business Standard)

Impact for Bangladesh:

• Short term: potential surge in orders if buyers see Bangladesh as an alternative to higher-tariff countries.
• Medium term: if tariffs are applied to Bangladesh as well (or if conditionality increases compliance costs), the advantage can evaporate quickly.

Likely scenarios after the U.S. election (practical, publishable scenarios)

Scenario A — Protectionist presidency / hawkish Congress

Policy moves: higher reciprocal tariffs targeted at apparel from several Asian suppliers; stricter conditionality on labor & environment; faster enforcement of rules of origin.
Effect on Bangladesh:

• Immediate: Export prices to the U.S. rise; some buyers cut volumes or shift to suppliers with lower effective duties. Margins squeeze for manufacturers that absorb duties. (Business & Human Rights Resource Centre)
• Medium term: Bangladesh may seek bilateral bargains (e.g., agricultural purchases, preferential quotas) or regional partners may step in; smaller factories face closure risk and job losses. (Reuters)

Scenario B — Trade-pragmatic administration / pro-market Congress

Policy moves: tariffs are moderated, more emphasis on trade facilitation and diversification support rather than punitive tariffs; conditionality is negotiated with transition periods.
Effect on Bangladesh:

• Immediate: Exports benefit from continued buyer diversification away from China; orders and investment rise. (The Business Standard)
• Medium term: Opportunities for Bangladesh to upgrade in supply chains (value addition, compliance investments), but exporters must invest to meet sustainability and labor standards to lock in buyers.

Scenario C — Mixed Congress / fragmented policy

Policy moves: uncertain, patchwork measures; episodic tariff threats; case-by-case conditionality.
Effect on Bangladesh:

• Policy uncertainty itself becomes the problem — buyers delay long-term sourcing commitments, financing becomes more cautious, and exporters face volatile order books and working-capital stress. (The Business Standard)

Who wins and who loses inside the sector

• Winners: Large, vertically integrated factories that can absorb compliance costs and meet higher standards; firms with diversified export markets (EU, UK, Canada) and strong buyer relationships. (LightCastle Partners)
• Losers: Small subcontractors and informal units that lack capital for upgrades; workers in low-margin factories if orders are cancelled or moved. (sports-entertainment.brooklaw.edu)

What exporters and policymakers should do now (practical checklist)

1. Stress-test pricing: Model landed costs under multiple tariff scenarios (10% / 25% / 37%+). Know the break-even points and who will bear the cost. (shenglufashion.com)
2. Accelerate compliance & certifications: Invest in factory safety, worker rights programs and environmental credentials — buyers reward certified suppliers. (bd.apparelresources.com)
3. Market diversification: Strengthen links with EU, UK, Canada, Latin America and regional buyers to reduce U.S. exposure risk. (LightCastle Partners)
4. Policy diplomacy: Government should actively engage USTR/Congress and offer credible quid-pro-quo (e.g., import deals for U.S. agri-goods, stronger enforcement of labor laws) to avoid blunt tariff measures. Recent MoUs show this is already happening. (Reuters)
5. Finance & social protection: Prepare contingency financing for small suppliers and targeted social safety nets for workers if order shocks occur. Multilateral lenders and ADB warnings underline macro risk. (The Business Standard)

Data & evidence (quick reference for your newsroom)

• U.S. import growth: Bangladesh’s apparel exports to the U.S. rose strongly in early 2025; multiple sources report double-digit year-on-year increases in H1 2025 as buyers diversified away from China. (textileinsights.in)
• Tariff pressures: Reporting during 2025 indicated U.S. reciprocal tariff proposals and some country-specific negotiated outcomes (press coverage cites very large nominal rates proposed, with subsequent negotiations changing final levels). (Business & Human Rights Resource Centre)
• Policy mixes: Bangladesh pursued diplomatic trade moves (e.g., wheat import MoU) to smooth trade tensions with the U.S. in 2025. (Reuters)

Suggested visuals & story enrichments

• Chart: Bangladesh apparel exports to the U.S., monthly/quarterly (2023–2025) — show H1 2025 surge. (Trading Economics)
• Map/infographic: scenarios showing tariff shock vs buyer-diversification paths and who bears the cost.
• Interviews: a BGMEA official, an SME factory owner, a brand sourcing manager in the U.S., and a worker representative — to capture business, buyer and human angles.

Bottom line

U.S. election outcomes matter for Bangladesh’s garment sector not because one vote changes fashion trends, but because elections shape the policy regime — tariffs, conditionality and geopolitical priorities — that determine how cheap or costly it is for U.S. buyers to source from Bangladesh. In the short term Bangladesh may benefit from buyer shifts away from China; in the medium term, tariff actions or stricter conditionality tied to political priorities in Washington can quickly erase those gains unless exporters, brands and Dhaka act pre-emptively on pricing, compliance and diplomacy.