Bangladesh will graduate from ‘Least Developed Country’ to ‘Developing Country’ status within the stipulated time, 2024, braving all odds like the ongoing coronavirus crisis.
The subsidiary body of the United Nations, Committee for Development Policy (CDP) is going to recommend Bangladesh to be recognised as a developing country in its next special meeting scheduled for February 2021.
General Economics Division (GED), Planning Commission Member Shamsul Alam, (Senior Secretary) at a recent programme had said that despite the Covid-19 situation, Bangladesh will exit LDC by 2024.
He said, “The coronavirus situation has been handled quite well. Almost everything in the country was closed for the first three-four months due to the virus outbreak. Later, economic activities started from last July. It's going well now. It can be said that the economy is turning around. Moreover, the effects of coronavirus are decreasing. Hopefully, this problem will come down a lot in the coming years. In that case it is possible to overcome the risks of LDC crossing.”
There are three types of countries in the world, these are- developed, developing and least developed or LDC. The United Nations calculates per capita income, human resource indices, and economic fragility or crisis indicators. At present there are 48 countries in the world including Bangladesh as LDCs. The United Nations recognizes the transition from LDCs to developing countries. This is assessed by the UN's CDP.
The whole process takes at least six years to complete. Bangladesh achieved primary qualification in 2017. If the final recommendation is received in 2021, according to the rules, the recognition of developing countries will be met in the UN General Assembly in 2024.
It is learned that after coming out of the list of least developed countries, there are some risks to the economy. In this case, getting duty free facility in export has become the biggest challenge. In addition, there is a risk that donors may set difficult conditions in getting foreign loans and grants.
However, the financial experts think that it would be beneficial to get more foreign loans as a result of developing the image in the international market if it becomes a developing country. The country's status as a nation will increase abroad. As it becomes a developing country, foreign investors are expected to be more enthusiastic about investing in Bangladesh. Opportunities will be created to open new trade and commerce with many countries.
On the contrary, Bangladesh will demand to increase the existing facilities as LDCs for the next 10 years (2034). In the meantime, Bangladesh is presenting its position in this regard in the United Nations, World Trade Organization and other international forums. Even if it exits LDC, Bangladesh will get benefits till 2027. However, there are rules for appealing to the World Trade Organization.
Preparations have been made by the Economic Relations Department (ERD), the Ministry of Finance and the Ministry of Commerce to exit from LDC. Coronavirus could not create any barrier to the LDC process.
As an LDC, the Commerce Ministry is talking about increasing the facilities for another 10 years. The exporters have already given their views to the ministry. The Commerce Secretary has requested the concerned departments to work for maintaining the existing facilities in the field of trade for the next 8-10 years even after the passage of LDC.
Commerce Secretary Md Zafar Uddin said that Bangladesh will exit LDC by 2024. However, the WTO has been informed that the existing facilities will extend for another 10 years. Hopefully, considering the coronavirus situation, it will allow the duty-free facility till 2034.
However, Research firm South Asian Network on Economic Modeling (SANEM) recommends postponing LDC passage amid Corona situation. It showed Bangladesh would face two challenges if it was removed from the list of least developed countries. These are the reduction of trade facilities and the obligation to meet strict conditions in the case of loans.
SANEM executive director Dr Selim Raihan in a recent statement about LDC graduation said that in the present situation (Covid-19), a two-year recovery plan may be adopted instead of the Eighth Five-Year Plan. At this time he specifically mentioned eight issues. One of these is that the transition period from LDC should be delayed for at least three years.
However, at the end of the birth centenary celebrations of Father of the Nation Bangabandhu Sheikh Mujibur Rahman, the government wants to give a message that although Covid-19 posed various challenges to the country's economy, education, health and social sectors, it did not create a major crisis in Bangladesh's sustainable development to the people of the country.
As a result, Bangladesh will present the development indicators to the United Nations while maintaining the previous continuity.