Forced labour and excess production: US hearings this month, gaps in Bangladesh’s preparation

The United States has initiated two separate investigations against Bangladesh and several other countries to assess whether effective measures have been taken to eliminate forced labour in production, and whether there is excess capacity and overproduction in manufacturing sectors.

Hearings on forced labour are scheduled to begin on 28 April, while those concerning industrial capacity and overproduction will commence on 5 May.

With only three weeks remaining before the hearings, the Ministry of Commerce is yet to hold any meeting with private sector stakeholders as part of its preparatory process. It has also not collected relevant data from business associations representing sectors directly concerned with the US investigations.

Consequently, there is growing concern among business leaders as to whether the Bangladesh government’s preparations for the hearings are adequate.

When contacted, Commerce Secretary Mahbubur Rahman told Prothom Alo, “Our preparations are fully in place. The USTR (United States Trade Representative) communicated with us via email, and we have responded. However, the email did not specifically mention the investigations. We plan to hold a virtual meeting with the USTR later this week.”

The United States remains the largest export destination for Bangladeshi goods. In the 2024–25 fiscal year, exports to the US amounted to US$8.69 billion, accounting for 18 per cent of the country’s total goods exports.

Last year, US President Donald Trump imposed a 20 per cent reciprocal tariff on Bangladeshi goods, which was later reduced to 19 per cent this year.

In the third week of February, the US Supreme Court declared the reciprocal tariff unlawful. Within hours of the ruling, President Trump imposed a fresh 10 per cent tariff, which was subsequently increased to 15 per cent the following day and came into effect on 24 February.

On 11 March, the United States launched an investigation into 16 countries, including Bangladesh, to determine whether excess industrial capacity and overproduction exist.

According to the Office of the United States Trade Representative (USTR), the probe will examine whether the policies, measures, or production structures of the concerned countries are unreasonable or discriminatory and whether they adversely affect US trade.

In Bangladesh’s case, the investigation will focus primarily on whether there is excess production capacity in the ready-made garments and cement sectors.

US Trade Representative Jamieson Greer stated that the United States would not allow its industrial capacity to be undermined by other countries. In other words, the US would no longer tolerate situations where excess production from other countries is channelled into its market.

He described the investigation as part of President Trump’s broader policy to revitalise domestic industry.

Separately, on 12 March, the United States initiated another investigation into whether 60 countries, including Bangladesh, have taken sufficient measures to eliminate forced labour in production.

The USTR noted that the probe would assess whether the laws, policies, and their implementation in these countries are reasonable or discriminatory in the context of banning imports of goods produced using forced labour.

It will also examine whether such policies or practices impose burdens or create barriers to US trade.

Mahmud Hasan Khan, President of the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), told Prothom Alo last week that there is no excess production capacity in the ready-made garment sector.

He also asserted that there is no scope for forced labour, adding that labour regulations are in the process of being formally enacted into law.

The BGMEA president emphasised that the relevant ministries should prepare evidence-based reports.

Asked whether the Ministry of Commerce had held any consultations on the matter, he said no meetings had taken place so far, though there is still time. He expressed hope that the ministry would engage with stakeholders before the hearings.

Similarly, Md Amirul Haque, President of the Bangladesh Cement Manufacturers Association (BCMA), stated that there is no excess production in the cement sector.

He explained that cement production is largely seasonal, with business activity concentrated in certain months, leaving little room for overproduction.

Amirul Haque also noted that the presence of numerous firms ensures healthy competition in the market.

Sources indicate that the Ministry of Commerce has recently taken steps to prepare a position paper for the US hearings.

On Monday, it issued letters to various ministries and agencies, as well as leading business bodies including the FBCCI (Federation of Bangladesh Chambers of Commerce and Industry), BGMEA, BKMEA, BTMA (Bangladesh Textile Mills Association), and the LFMEAB (Leathergoods And Footwear Manufacturers & Exporters Association of Bangladesh), requesting their input within two days.

Mohammad Hatem, President of the BKMEA, confirmed receipt of the letter. He remarked that although the initiative has come somewhat late, it is nonetheless welcome.

He expressed optimism that Bangladesh would be able to participate in the hearings with adequate preparation.