The category of least developed country (LDC) was created in 1971 – the year Bangladesh achieved political and economic independence.
For those LDC’s graduation analysis, which tends to overlap with income status, it is to be distinguished here that low-income country (LIC) and LDC thresholds are mutually exclusive, ie, they produce two distinct interpretations. This is where the question of sophisticated rhetoric creeps in.
LIC status governs access to concessional lines of finance, and not all LDCs are LICs. In case of Asia-Pacific, they range from Tuvalu – an upper middle-income country (UMIC) – to Bhutan, Kiribati, Lao PDR, Solomon Islands, Timor-Leste, and Vanuatu – low middle-income country (LMICs) – and to Afghanistan, Bangladesh, Cambodia, Myanmar, and Nepal – LICs.
This article focuses on the development aspect, because LDC’s graduation does not necessitate Bangladesh becoming an MIC or LMIC.
LDC graduation thresholds
The number of LDCs is revised on a triennial basis by the UN’s Committee on Development Policy (CDP). Three major considerations for LDC’s graduation are: Gross national income (GNI) per capita, level of human capital or human assets index (HAI), and the economic vulnerability index (EVI).
The income threshold for graduation is set at 20% above the inclusion threshold, and it will be $1,242 in the upcoming 2015 review. On the other hand, the EVI and HAI thresholds have been permanently fixed by CDP.
Recent government estimates from the Ministry of Finance, presented in Table 1, indicate that Bangladesh is set to graduate from the LDC group by 2021. The country is on track to meet two out of the three graduation thresholds before the next CDP triennial review in 2015.
During the launch of the latest UNCTAD LDC report, a local research organisation opined that Bangladesh has not met any of the three thresholds, and that it will need at least a decade beyond 2021 to become an MIC. This is certainly not true. Additionally, statements on whether Bangladesh will attain LMIC/MIC status certainly dilute the LDC graduation objectives.
Nor does UNCTAD make any such indications, but it highlights Bangladesh’s achievements within the Asia-Pacific LDC group. In case of foreign aid, remittance, and foreign investment, Asian LDCs registered the most progress, with Bangladesh being recognised as the main driver.
LDC graduation process
Successes achieved in both HAI and EVI could earn Bangladesh “eligibility” recognition by 2015.
If Bangladesh is found eligible for graduation between 2015 and 2018, UNCTAD and UNDESA will prepare a vulnerability profile and an impact assessment, respectively. At the 2018 triennial review, CDP will review the latter, alongside country inputs, and subsequently recommend Bangladesh for graduation to ECOSOC and the General Assembly.
From 2018 to 2021, CDP will monitor Bangladesh’s progress with the three thresholds.
After being recommended by CDP, the UN’s General Assembly will decide within the next three years, which will be 2021 – the Golden Jubilee of Bangladesh’s independence. Table 2 offers a timeline and a summarisation of both the UN process and national priorities.
The political commitment is explicitly articulated by the national 10-year Perspective Plan and a graduation strategy being prepared by the government. The prime minister of Bangladesh has rightly pointed out that “Bangladesh will be moving out of the LDC status, but the country does not need to rush ahead.”
Whilst policy-makers with left-to-centre bias promote the idea of graduation, opponents argue that Bangladesh would stand to suffer heavily as a result of erosion of trade preferences if the country graduates.
The problem is neither opponents nor supporters of graduation, but those respected opinions transcending LDCs discussion to the ladder of LICs in an attempt to underplay the significance of LDC graduation for Bangladesh.
The graduation of Bangladesh from LDC status is, nevertheless, inevitable – whether by 2021 or 2024. As we gear up to celebrate our nation’s 50th birthday, we should neither forget what has been achieved nor should we lose focus on the inevitable.
Many of us have been an expatriate, a foreign student, or a visitor to a country which is at least relatively more developed than Bangladesh. We have often walked with people around the world from many strands of development and income status.
There is no doubt today that we have integrated well with the global economy as a virtue of our “least developed” grade, but is it not necessary to celebrate as we free ourselves from its clutches?
Recalling grandma’s advice
During pregnancy times, expecting parents who go all-in to planning and strategising are often cautioned by their elderly that they should wait until post-delivery to make any type of plans or purchases – whether short, medium, or long-term. Our grandmothers believed that such impulsive engagement without focusing on the need of the hour – taking care of the mother and praying for a healthy child – jinxes the birth cycle.
Surely, we are not only praying but are also hoping of making a healthier Bangladesh. In the same vein, gaining non-LDC recognition implies a new Bangladesh – at least in the global terms, if not for many cynical citizens.
Bangladesh is our mother, and we are her children. Just as our mother walks into a non-LDC realm, we too should gear up to embrace the Golden Jubilee opportunity to tell the world our “basket case” story in a whole new way. This will not only make our mother proud but will also help others to not to shy away from rays of hope.
