In a significant move to optimize its global supply chain, American e-commerce giant Amazon is seeking to establish central bonded warehouse facilities in Bangladesh. The request, aimed at leveraging tax benefits, was confirmed by State Minister for Commerce Ahasanul Islam Titu during a press conference held at the commerce ministry in Dhaka yesterday.
Amazon has a longstanding relationship with Bangladesh as a key sourcing hub for clothing. The proposed bonded warehouse facilities would allow Amazon to utilize Bangladesh as a transshipment hub, facilitating the movement of goods through its global supply chain before dispatching them to various destination countries. This strategic move is intended to capitalize on favorable tax rates across different regions and ultimately reduce Amazon’s overall tax burden.
State Minister Titu shared these insights while addressing journalists following a meeting with a delegation from the US-Bangladesh Business Council. The delegation included representatives from major American corporations such as Meta, Chevron, The Coca-Cola Company, and Boeing.
The minister highlighted the government’s commitment to amending the current e-commerce policy. This amendment would enable local Bangladeshi e-commerce companies to engage in international transactions and ship products to customers worldwide. Presently, the existing policy restricts these companies to domestic transactions only.
“This policy change is crucial for enabling our local e-commerce businesses to compete on a global scale,” Titu stated. “Organizations like the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) have been advocating for a framework that allows Bangladeshi companies to distribute products internationally and handle international financial transactions.”
In response to a query, Titu emphasized the government’s intention to formulate a new policy to address these demands. Additionally, he pressed for easier access for Bangladeshi goods to US markets, pointing out that Bangladesh is the largest importer of American cotton. He reiterated the longstanding demand for duty benefits on garments made from imported US cotton, noting that Bangladeshi garment exporters currently face a steep 15.62 percent duty on exports to the US.
Furthermore, the state minister mentioned the adoption of a national logistics policy aimed at supporting the e-commerce sector by establishing the necessary infrastructure and strategies.
“The interest shown by such major companies indicates that Bangladesh holds substantial potential for business expansion,” Titu remarked. “We are not only looking at serving the 170 million people in Bangladesh but also the 330 million people in neighboring countries around the Bay of Bengal.”
The 30-member delegation, led by Steven Kobos, President and CEO of Excelerate Energy, and Atul Keshap, President of the US-Bangladesh Business Council, engaged in detailed discussions with Titu, exploring various avenues for enhancing bilateral trade and investment.
As Bangladesh continues to attract global business giants, the government’s proactive steps in reforming policies and creating a conducive business environment are expected to further boost the country’s economic prospects on the international stage.
