Bangladesh's LDC graduation likely to be deferred

Bangladesh's LDC graduation is poised to be deferred as the UN body concerned endorses government's request for a delay for three more years until November 24, 2029 amid local and global adversities.
Official sources say that, taking into consideration Bangladesh government's request for delay in graduation from the least-developed country (LDC) category, the United Nations Committee for Development Policy (CDP) has expressed a positive view.
However, the CDP has emphasised that Bangladesh has to make significant progress in implementing key domestic reforms to address its existing structural vulnerabilities during this extended preparatory period.
The must-dos include ensuring financial-sector stability, increasing tax revenue, strengthening domestic resource mobilisation, enhancing productive capacities, promoting economic diversification, and preparing the private sector for graduation, says a press release issued Tuesday by the Economic Relations Division (ERD).
Chair of the CDP Prof José Antonio Ocampo has informed the government of Bangladesh that based on the committee's assessment, it would be appropriate for the United Nations General Assembly to approve an extension of Bangladesh's preparatory period for LDC graduation.
The government on February 18 formally requested the CDP to extend the preparatory period for Bangladesh's exit from the world's poor-country club by three years. Subsequently, on April 6, 2026, the Prime Minister wrote to the UN Secretary-General seeking his personal support on the matter.
In its assessment, the CDP notes that Bangladesh "has exceeded the graduation thresholds by a significant margin under all three LDC-graduation criteria and faces a very low risk of falling below these thresholds in the near to medium term".
Nevertheless, the committee observes that the recent crisis in the Middle East, uncertainties in global energy and supply chains, changes in the international trading environment, and global challenges could affect the country's graduation preparedness and transition process.
Also, the UN panel welcomes the government's commitment to implementing the Smooth Transition Strategy (STS).
It considers that an extension of the preparatory period would provide Bangladesh with additional time to better assess the implications of the current global situation, identify priority actions, and prepare adequately for the post-graduation landscape, including the loss of certain market preferences and international support measures.
The CDP also underscores the importance of continued support from the international community for Bangladesh during both the preparatory period and the post-graduation phase.
These supports include concessional financing, appropriate extension of LDC-specific International Support Measures (ISMs), technical assistance, and enhanced capacity for trade negotiations.
The committee observes that the extension of the preparatory period should not be viewed as an opportunity to delay reforms, rather, it should serve as a catalyst for accelerating them.
"The government firmly believes that, with the support of the international community and the successful implementation of ongoing reforms, Bangladesh will be able to achieve a smooth, sustainable, and successful graduation from the LDC category," notes the ERD release.
Contacted, Dr Fahmida Khatun, Executive Director at the Centre for Policy Dialogue (CPD), told The Financial Express if the graduation is postponed as per CDC recommendation, Bangladesh will get three more years to take required preparation and has to utilise the time properly.
She says during the period, the government will have to get ready for increasing domestic resources mobilisation as various assistances and facilities the country will lose after the graduation.
"After graduation all that flexibilities will go. We have to take preparation to face the post-LDC-period challenges successfully," Ms Khatun suggests.

syful-islam@outlook.com