The committee on white paper on the state of the economy has advised the government not to defer the deadline for graduation from the least-developed country bracket scheduled for November 2026.
Based on the committee’s assessment of data and information, Bangladesh meets the requirements for LDC graduation despite the challenging economic situation, said its chair Debapriya Bhattacharya.
“So, we don’t see any reason to withhold the LDC graduation process,” he said at a press conference yesterday.
A group benefiting from market facilities is trying to halt the process but they must remember that Bangladesh will still enjoy three additional years of these facilities.
Debapriya Bhattacharya
A group benefiting from market facilities is trying to halt the process but they must remember that Bangladesh will still enjoy three additional years of these facilities, he said.
“We need to abandon the mindset that such privileges will last forever,” said Bhattacharya, also a distinguished fellow at the Centre for Policy Dialogue.
However, there is a discussion within the interim government on whether the deadline for graduation will be deferred or not.
The finance adviser earlier told the media that they are yet to take a call on the matter.
Meanwhile, a section of exporters is putting pressure on the government to shelve the graduation as the Bangladesh economy is in a fragile state from the pandemic, the Ukraine war, domestic political turmoil, global inflationary pressure and energy shock.
In its report, the white paper committee said that the recent concern about the inflated nature of certain critical indicators will have little relevance in this case.
The UN bodies will only revisit their calculations when a revised data set (including the GNI estimates) is available from government sources.
Notwithstanding the reservations expressed by certain exporters’ groups, there is hardly any plausible reason, as of now, for Bangladesh to request a deferment of the exit date from the LDC group, it said.
“Under these circumstances, Bangladesh will be well advised to pursue a substantive and effective LDC graduation strategy. This will require putting forward a transition plan to counteract the negative fallouts of Bangladesh’s graduation out of the LDC group and enable the required structural transformation of the economy.”
The postponement of Bangladesh’s LDC graduation date will invite political backlash from the expected quarters, the white paper said.
A smooth transition strategy (STS) to support the LDC graduation trajectory of Bangladesh has already been developed.
However, concern remains regarding its coordinated implementation, including the challenge of institutional and policy leadership.
Bangladesh has, on two occasions (2018 and 2021), met the three sets of graduation thresholds set by the UN Committee for Development Policy (CDP), it said.
According to the recent triennial review by the CDP in February, the current status of Bangladesh remains comfortable despite the recent economic and political challenges.
Indeed, even the recent dampened economic performance during the current fiscal year is not expected to bring the country down below the stipulated thresholds, it said.