The ongoing trade war between US and China will benefit Bangladesh in terms of more exports to the country, says the Asian Development Bank (ADB).

Bangladesh’s exports will increase by $400 million and the Gross Domestic Product (GDP) by 0.19% by next one to two years if the trade conflicts escalate, ADB chief economist Yasuyuki Sawada said.

Under the current scenario, China’s export to US will go down as it will lose competitiveness and the supply chain will be affected, he said in Dhaka on Monday (Mar 6).

Addressing a seminar titled ‘Impact of Emerging International Trade Relations on Bangladesh’, Sawada said, “…China to lose business of $126.4 billion and GDP can go down by 1.03%, while Bangladesh exports to increase by $400 million and the GDP to grow by 0.19%.”

The visiting chief economist of the multi-lateral lender said the US is planning to impose 25% tariff on $200 billion imports from the China, while China is considering trade measures on $100 billion imports from the US.

Given the current standoff between the two counties, China’s export to US will go down and it will lose competitiveness while the supply chain will also be affected, said Sawada.

“As a result, China sees huge direct and indirect affect on trade, whereas other Asian countries including Bangladesh seem to gain out of trade redirection,” added Sawada. 

He also said sectors like RMG, leather and leather goods might rip benefits from the trade war.

ADB Country Director Manmohan Parkash said the emerging trade relations could offer opportunity for Bangladesh to increase its export and capture greater space in the global value chain.

However, Prakash also said this may not be easy.

“It will hinge Bangladesh ability to align its trade investment and infrastructure with the operative principle of global value chain,” Parkash said.

He said a number of policy actions, incentives, and structural reforms may be needed to woo foreign investors to relocate their industries in Bangladesh.

 “China is the largest exporter but I can assure that Bangladesh will be benefited from the trade conflicts. Despite having negative impact on the global trade, Bangladesh's exports especially readymade garment products will grow further,” Commerce Minister Tipu Munshi said while addressing the event.

The minister also said fresh work orders are coming here.

“However, Bangladesh has to properly follow what is happening there and come up with long term plan to tap the opportunity,” said the minister.    

“We can take the advantage of US-China trade war,” he added.  

According to Bangladesh Bureau of Statistics, Bangladesh has achieved a 7.86% growth In the 2017-18 fiscal year.