Bangladeshi cos expecting increased costs due to tariffs, yet extremely optimistic about int'l growth: HSBC survey

Due to the tariffs, Bangladeshi businesses have experienced a lower-than-average cost increase to date and are expecting a notably lower short and long-term cost increase, but optimism reigns about their international growth, an HSBC survey has found. 

In the HSBC's 2025 Global Trade Pulse Survey, it was also found that the mean average expected impact on revenue to a Bangladeshi business due to supply chain delays or interruption was 5% higher than the global average.

The survey said Bangladeshi companies had enhanced data analytics, developed risk management plans, ran simulations to prepare for different trade outcomes and diversified supply chains. 

"The companies interviewed are extremely optimistic about their international growth but half of those surveyed would like strategic advice in navigating international expansion."

It said in light of current trade dynamics, businesses in Bangladesh are adapting their trade strategy to increase reliance on Europe, the USA and South Asia.

Commenting on the trade survey findings on Bangladesh, Md Mahbub ur Rahman, chief executive officer, HSBC Bangladesh, said, "The survey findings highlight the adaptability of the Bangladeshi businesses and their optimism to embrace changes. With our global expertise and strong international network, we are ideally positioned to collaborate with our customers and keep connecting them to opportunities here and from around the world." 

The survey said global businesses had been hit with surging costs, supply chain disruptions, and were having to rethink their strategy and planned investments as tariffs and shifting trade policies continue to impact their enterprises.

The survey – which offers insight into the business plans and sentiment of over 5,700 international firms across 13 markets regarding tariffs and trade – revealed that two thirds of corporations have already experienced cost increases due to tariff and trade uncertainty, with the "worst may be yet to come". 

"Companies expect costs to escalate further in both the short-term (73%) and the long-term (72%). Businesses also expect an average decline in revenues of 18% due to supply chain delays. Over half of respondents (51%) feel rising costs are the number one concern for supply chain strategies and 85% of corporates have revised or plan to revise their pricing strategy upwards to reflect higher costs or market changes."

Over three quarters of corporates (78%) are having to rethink their long-term business model and if tariff instability continues over the next two years, 43% of companies will rethink their international expansion strategy and 39% will shift their focus to domestic or regional markets, the survey said.

"Despite these headwinds, optimism about expanding global trade is strong. Nearly 9 in 10 businesses (89%) are confident in their ability to grow international trade over the next two years. Businesses are also reconfiguring their supply chains and reassessing how and where they operate. Most are taking action or planning to carry out nearshoring (moving production closer to key customer markets, 83%) and reshoring (bringing production back to their home country, 77%)."

It said businesses were most likely to initiate nearshoring, a practice gaining most traction by globally exposed and production-centric sectors, which are in Technology, Media and Telecoms (87% have done so or plan to). 

Businesses most likely to have experienced an increase in costs to date are those in Consumer (70%), followed by Healthcare (69%), and TMT (69%).

It said a vast number of respondents see trade pressure as a catalyst for innovation, with 77% saying it has encouraged them to evolve and seek new opportunities. 

The survey points to the emergence of new trade corridors in some of the markets surveyed and global businesses strengthening their relationships with key markets outside their borders. 

Malaysia (61%), Vietnam (52%) and Bangladesh (54%) are expanding their relationships with China; Bangladesh (65%) India (54%) and the United States (51%) with Europe, and the United Kingdom (46%), India (62%) and Bangladesh (58%) with the United States. 

In some markets, optimism about international trade growth endures, led by India (96%), to include Bangladesh (95%) and the United Arab Emirates (94%), the survey said. 

In line with the global positive outlook, larger businesses (those with a revenue over $2 billion) are confident about their ability to grow international trade over the next two years (82%), although less so than the average, (89%). 

They are also more likely to have adopted new technology or digital platforms in response to trade uncertainty in comparison to smaller businesses (those with a revenue of less than $500m) at 63% vs. 56%. 

Vivek Ramachandran, head of Global Trade Solutions at HSBC, said, "The current landscape of tariffs and trade uncertainty presents significant challenges for businesses, but they are showing great resilience and adaptability in the way they operate.

"With over 70% of companies anticipating sustained cost increases, and businesses facing an average 18% drop in revenue, the imperative for strategic adaptation is clear. Navigating this climate requires not only agility, but strong partnerships to ensure sustained growth in a shifting global economy."