Prime Minister Tarique Rahman has requested the United Nations to defer Bangladesh's graduation from the Least Developed Country (LDC) category by at least three years to ensure a sustainable transition amid internal and external shocks.
The premier on Sunday wrote to UN Secretary-General António Guterres seeking the deferral, officials said on Tuesday.
The request, submitted to the UN chief on Monday, comes as Bangladesh grapples with a "preparatory period" that officials say was effectively derailed by a "polycrisis" of global and domestic shocks, a highly placed source told The Financial Express.
Bangladesh was scheduled to graduate from the LDC category to a developing nation in November this year.
If the UN accepts the request, the country will get an additional three years-until November 2029 -- to complete its transition.
Following calls from leaders of top business chambers, trade bodies and some economists, the interim government had earlier recommended coordinating with fellow graduating countries such as Nepal and Lao PDR to pursue a deferral until 2030, leaving the final decision to the elected government.
In his formal communication, Tarique Rahman noted that while Bangladesh meets the three eligibility criteria -- per capita income, Human Assets Index and Economic Vulnerability Index -- the five-year preparatory window was largely consumed by crisis management.
In the letter, he said the newly formed government inherited a severely strained macroeconomic environment marked by prolonged capital flight, limited access to finance for the private sector, a weakened capital market, rising poverty and mounting pressure on the banking sector.
Highlighting the deterioration of macroeconomic indicators, he said these challenges have been compounded by overlapping shocks, including the lingering socio-economic impacts of the Covid-19 pandemic, climate-induced disasters such as the 2024 floods, and global price volatility driven by geopolitical tensions -- further constraining fiscal space and institutional capacity.
The prime minister also underscored the burden of hosting displaced Rohingya people from Myanmar, despite declining international aid.
Citing the "Graduation Readiness Assessment" report prepared by the UN-OHRLLS and the IMF's recent outlook, Mr Rahman formally requested the UN to defer Bangladesh's graduation.
He said that due to political instability and a prolonged interim government period, Bangladesh lost valuable time during its five-year preparation phase and only adopted the Smooth Transition Strategy (STS) in February, necessitating an additional three years.
Another official at the Ministry of Finance said recent political upheavals, including the July 2024 uprising and the subsequent transition of power, alongside irregularities in the financial and banking sectors, declining foreign exchange reserves, persistent inflation and the fiscal burden of hosting over a million Rohingya refugees, have weighed heavily on the economy.
The primary concern behind the request is the looming loss of international support measures (ISMs) following graduation.
Once Bangladesh graduates, it will face a "preference cliff" -- losing duty-free and quota-free market access to major economies.
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