Bangladesh: Graduation impact assessment expected next year
The Bangladesh government announced its intention to launch a detailed impact assessment of the country’s graduation from least developed country (LDC) status. The objective of the assessment is to analyse the possible negative impact of the country’s graduation which is projected for 2024 with a three-year transition period. Officials hope to launch the assessment by August of this year, completing the analysis in time for the next UN Committee for Development Policy (CDP) review mid-2018.
Experts note that Bangladesh is expected to graduate from both UN and World Bank classifications, limiting options for concessional financing. The LDC status is determined by UN criteria and is the basis for the EU’s EBA criteria. Once the country graduates, it will automatically fall under the regular EU GSP scheme. Bangladesh would then need to build its case for GSP+ in order to maintain duty-free access for 66% of its tariff lines (including textiles and clothing).
The UN CDP reviews countries’ compliance with LDC criteria every three years with the next review to take place in 2018. Given that an LDC must meet the graduation criteria for two consecutive CDP reviews, Bangladesh will already need to meet the criteria in 2021 in order to stay on track for its 2024 graduation.
Although experts see Bangladesh’s graduation as a positive sign of the country’s rapid economic growth, government officials will still need to increase their negotiating capacity in order to lessen the possible trade disturbances during the transition from LDC status and hopefully to GSP+ status.