Eminent economist Dr Debapriya Bhattacharya on Sunday recommended that the government draw up a robust LDC transition strategy for next five years and beyond.
"With a view to ensure inclusive development-underpinned by growth of investment, employment and income-building of productive capacity should be the fundamental and core priority in Bangladesh context," he said.
These are needed to deal with the possible adverse fallouts of graduation from least developed country (LDC) status and also to layout a pathway for graduation with a momentum, he added.
Mr. Bhattacharya, also a distinguished fellow of the Centre for Policy Dialogue (CPD), said apart from losing various market preferences, after the graduation to the non-LDC status, Bangladesh will face challenges emerged from the Covid-19 pandemic and, Rohingya maintenance and repatriation have to be addressed.
Lowering inequality and ensuring good governance will also come as other major challenges, he said.
Mr, Bhattacharya, a member of the Committee for Development Policy (CDP), a body of the United Nations that recommended the LDC graduation, was speaking to the newsmen on the challenges and way forward for Bangladesh after the country's leaving the poor countries' club.
The Citizen's Platform for SDGs, Bangladesh organised the virtual discussion titled 'Bangladesh's LDC Graduation: What Next?'
Mr. Bhattacharya also pointed out the necessity of economic diversification, technological development and improvement in labour productivity.
"(The) focus on domestic market expansion and consolidation would be the key in this regard," he said and added that essentially, the sustainable development goals must be used as the guiding framework for crafting a winning transition strategy for LDC graduation.
While describing the losses of LDC-specific preferences, particularly in the area of duty-free and quota-free (DFQF) access to export markets, Mr. Bhattacharya said the LDC graduation would relinquish a wide variety of preferences and privileges.
These include loss of market access preferences particularly in European and Canadian markets, and shortfall to the tune of 8.0 to 10 per cent of its gross export revenue due to loss of the DFQF provision amounting to nearly US$2. 5 billion annually, he said.
Already many bilateral and multilateral partners have started providing blended loans, which mean a mixture of soft- and hard-term loans, as the economy has moved up from the low income country group to lower middle income country group before 2015.
"The loss of LDC Fund for Climate Change (managed by the Global Environment Facility) will be a worrisome consequence," he said.
Mr. Bhattacharya also added that Bangladesh's pharmaceutical industry will stop enjoying the flexibility seven years before the expiry of the globally stipulated preferential period due to the graduation as the industry will not be able to avail special exemption of Trade Related Aspects of Intellectual Property Rights (TRIPS).
The CDP of the UN suggested preparing a smooth transition strategy and planning a post-graduation international trade landscape, considering priority policy areas to strengthen domestic resource mobilisation, and placing job creation at the centre of the 8th five-year plan.
It also suggested increasing investment in the health sector, diversification of export products and markets, and accelerating its efforts to scale back from coal-fired power plants and shift to clean and sustainable energy.
The CDP also called upon the Bangladesh's development and trading partners to extend preferential market access and the exemptions under TRIPS for a reasonable period of time.
It also requested the development partners to provide financial and technical support to strengthen the health sector and tackle the impact of climate change, particularly measures to prevent destruction created by flooding.
Mr Bhattacharya said the international community wanted to make sure that the preferences they offer to developing countries goes in favour of the underprivileged people.
"They may suspend these special preferences unless good governance, human rights, and civic rights are ensured properly," he warned.
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