[🇧🇩] LDC Graduation For Bangladesh

[Saif]

Bangladesh must prepare for post-LDC challenges

Bangladesh is set to graduate from the least-developed country (LDC) club next year, which will bring several challenges in international trade.

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Bangladesh must prepare for post-LDC challenges
CPD’s Mustafizur Rahman tells The Daily Star

Mustafizur Rahman

Bangladesh is set to graduate from the least-developed country (LDC) club next year, which will bring several challenges in international trade.

However, the country is not yet prepared to face these challenges, Prof Mustafizur Rahman, a distinguished fellow of the Centre for Policy Dialogue (CPD), said in an interview with The Daily Star.

Bangladesh has met the criteria for graduation in all three categories -- per capita income, human asset index, and economic vulnerability index. It is expected to be upgraded at the next UN General Assembly meeting, scheduled for November 2026.

"It is very difficult to justify deferring graduation from the LDC status, as demanded by many businessmen," he said, adding that even if graduation is delayed, only Bangladesh and Afghanistan will remain in LDC status in this region.

The chief adviser to the interim government last week ordered all concerned to prepare for LDC graduation on time and Prof Rahman echoed those sentiments, saying the focus now should be on preparing to face post-LDC challenges.

He said about 70 percent of Bangladesh's exports to other countries currently benefit from preferential trade agreements, which will be phased out after graduation.

For instance, tariffs in the European Union (EU) market will increase by around 11.5 percent after LDC graduation, while an additional 15 percent will be imposed in the Canadian market.

Increased tariffs in markets like the EU and Canada will pose new challenges, said Rahman, who was a professor at the Department of Accounting and Information Systems at Dhaka University before joining the CPD full-time.

"But we are not taking adequate preparation."

To stay competitive, Bangladesh must enhance enterprise-level productivity, streamline trade facilitation, and improve compliance.

"As we graduate from the LDC category, our priority should shift from preference-based competition to efficiency-driven competition."

Exporters' costs rise if trade facilitation and logistics are not up to the mark, so steps must be taken to reduce these costs.

Bangladesh must also improve labour and environmental standards. As an LDC, buyers and consumers in developed nations have overlooked these issues. Once the country graduates, international buyers will emphasise them.

"So, it is high time to start focusing on these issues," said Rahman.

After graduation, Bangladesh will have to comply with the Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS) regulations, which may create difficulties for the pharmaceutical sector in exporting products.

"So, we should prepare for these situations."

Meanwhile, Donald Trump has shaken global trade by imposing tariffs. Many believe countries like Bangladesh will benefit from the tariff barriers imposed on China, Canada and Mexico.

"I have a slightly different view," said Rahman. "I don't think we should rely heavily on this."

When Trump imposed a 25 percent tariff on China in 2016, Biden maintained it. During this period, Bangladesh had the opportunity to expand its ready-made garment (RMG) exports to the US, but it didn't see significant gains.

In fact, exports have slightly declined in recent years, said Rahman, who was awarded the Ibrahim Memorial Gold Medal by the University of Dhaka in 1999 for the best research work in economics.

China primarily exports non-cotton textiles, which make up around 80 percent of its total RMG exports, while Bangladesh focuses on cotton-based garments, creating market segmentation. Increased tariffs on China might benefit competitors in synthetic fibres but not Bangladesh, the economist clarified.

Moreover, such tariffs may negatively impact US economic growth and inflation, which, in turn, could affect global trade.

Instead of relying on geopolitical shifts, Bangladesh should enhance its competitiveness by reducing business costs, improving logistics, and increasing productivity.

Regarding free trade agreements (FTAs), the economist said Vietnam has 52 bilateral and multilateral free trade agreements, whereas Bangladesh has only one FTA with Bhutan.

This may be because signing FTAs requires offering lower import duties, a tough proposition considering that a significant portion of Bangladesh's revenue comes from duties.

Moreover, industrial and environmental standards will have to improve in factories, as FTAs operate on a reciprocal basis.

Since Bangladesh is set to graduate, there is no other option but to raise standards across all sectors, according to Prof Rahman.

Regarding economic stability, Rahman said several accumulated challenges existed when the interim government took power, and expectations were high.

"In the first and second quarters of the current fiscal year, economic pressure was intensifying. However, in the third quarter, some positive trends have emerged in certain indicators."

For example, Rahman said inflation remains high, but its rate has slightly declined. The availability of winter vegetables in the market during the third quarter has had a positive impact.

Besides, the adoption of a contractionary monetary policy, adjustments in revenue policies, and reductions in certain tariff rates were aimed at balancing fiscal and monetary policies. These measures seem to be having some effect, said the economist.

Another key factor is the external sector -- exports have seen double-digit growth, and remittances have recently experienced their highest growth in years.

As a result, the depletion of foreign currency reserves has halted, stabilising the exchange rate at around Tk 122 per dollar. The difference between the kerb market and the official exchange rate has also narrowed to about Tk 1.5 to Tk 2.

Consequently, imported inflation has somewhat decreased, positively impacting overall inflation, he said. However, inflation remains high, with both food and non-food inflation around 9 percent.

"This has continued to erode people's purchasing power, as wage growth has not kept pace with inflation.

"I believe there is still room for action in market mechanisms. One approach is to increase the number of active market players. Previously, a small group dominated imports, but as some have exited, new importers have entered the market," he commented.

"With greater competition, prices have stabilised to some extent."

He added that another persistent issue is extortion in certain areas. This must be addressed with a zero-tolerance policy.

Moreover, maintaining sufficient stock levels of key commodities and timely open market sales can help stabilise prices, he said.

Historically, poor data management has led to inaccurate decisions regarding production, import volumes, and stock releases. Addressing this issue can lead to more effective market interventions, the economist said.

The biggest concern is now investment. Since Bangladesh adopted a contractionary monetary policy to control inflation, interest rates have risen.

Besides, the banking sector is burdened by the significant accumulation of non-performing loans (NPLs), making it difficult to lower interest rates.

One of the major challenges is how to generate employment and how to reinvigorate investment so that entrepreneurs can actively engage.

Rahman said many investors are likely awaiting elections, hoping political uncertainty will subside afterwards, as investment decisions are usually made with a medium-term outlook.

Regarding the recovery of stolen money, Rahman, who was a member of the white paper formulation committee, said some initiatives have been undertaken.

The Bangladesh Bank has formed a special task force, and the Bangladesh Financial Intelligence Unit (BFIU) and the Anti-Corruption Commission (ACC) are also showing some activity.

However, this process needs to be expedited. Special prosecutions should be pursued where necessary. Recovering laundered money requires legal validation and the establishment of a paper trail to identify ultimate beneficiaries.

"The country must invest in this."

If other nations can recover laundered money, so can Bangladesh. Taking action now will also send a strong message that financial crimes will not go unpunished, he added.​

 

[Saif]

LDC graduation: Challenges and progress

For years, Bangladesh has been approaching a crossroads in its development journey. Having met the criteria for graduation from Least Developed Country (LDC) status in 2018, the government found itself in a conundrum.

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LDC graduation: Challenges and progress

For years, Bangladesh has been approaching a crossroads in its development journey. Having met the criteria for graduation from Least Developed Country (LDC) status in 2018, the government found itself in a conundrum. While graduation symbolises progress and economic maturity, it also threatens to remove trade preferences amid declining foreign reserves, stagnating exports, reduced incentives, and supply chain weaknesses. External shocks, including the Russia-Ukraine war, Middle East tensions, and global inflation, have further complicated this decision.

Despite these challenges, the Bangladesh government has made the courageous decision that graduating from LDC status will strengthen the nation's long-term economic prospects. Rather than postponing, Bangladesh has chosen to face these challenges, refusing to bow to external pressures and signalling confidence in the country's resilience and capacity for adaptation.

However, Bangladesh's transition differs from that of other graduating countries. With around 84 percent of exports concentrated in the ready-made garments (RMG) sector, the nation faces a concentrated risk profile. Unlike other graduating LDCs with more diversified export portfolios, Bangladesh must navigate this transition while protecting its dominant industry and accelerating diversification efforts. This reality demands an exceptional level of preparation and coordinated action.

With LDC graduation, 74 percent of Bangladesh's exports will face market access changes. The EU will enforce stricter trade regulations, such as double transformation rules of origin and an automatic safeguard clause. While GSP+ is an option, it requires compliance with 32 international conventions, and Bangladesh may not qualify since exports exceed the 37 percent threshold. Although GSP benefits in the EU will remain until 2029 and market access to the UK and Australia will continue, trade relationships with Canada, Japan, China, South Korea, and SAFTA countries remain uncertain.

Unlike Vietnam and Cambodia, which have secured favourable regional and bilateral agreements, Bangladesh must now accelerate its trade diplomacy efforts to mitigate the impact of lost preferential access.

The decision to graduate comes at a time when foreign reserves have plummeted, exports have stagnated, and export incentives have been reduced by 60 percent. Many small and medium-sized factories that relied on these benefits have closed, exposing weaknesses in competitiveness due to rising costs. To ensure the sustainability of these businesses post-graduation, the government must implement support mechanisms such as technical assistance programmes, access to affordable financing, and productivity enhancement initiatives to help offset the removal of tax advantages and preferential market access.

The RMG sector, accounting for a major percentage of national export earnings, requires special attention. The WTO and UNCTAD reported a 5 percent decline in the global clothing trade in 2024, signalling tough times. While Bangladesh saw export growth earlier this year, a two-year comparison shows stagnation.

To protect this industry, steps must be taken to enhance competitiveness through technology upgrades, skill development, and product diversification. The government and industry stakeholders should collaborate to counter falling export prices and rising production costs. Despite meeting graduation criteria in 2018, Bangladesh has made limited progress in areas such as trade logistics, energy supply, and customs efficiency. Business costs remain high, and planned economic zones are not yet fully operational.

With graduation imminent, these infrastructure and policy bottlenecks must be addressed urgently. The government should create a task force to fast-track projects that impact export competitiveness, including power generation, transportation networks, and port facilities. Since GSP+ is unlikely to offer relief, securing bilateral trade agreements is imperative.

Bangladesh must overcome regulatory and structural challenges to make itself attractive for such agreements. This requires reforms to investment policies, intellectual property protection, customs procedures, and digital trade frameworks. A negotiation team with private sector representation should be established to pursue these agreements.

The author is a former director of the Bangladesh Garment Manufacturers and Exporters Associationb​

 

[Saif]

LDC graduation on time despite tariff turmoil

There is no going back for Bangladesh in its LDC graduation as the plane of status change has already taken off, a top-level meeting noted Tuesday and decided on measures to maximise its trade-economic benefits. "One should keep it in mind that we are not on the ground--we are flying to the

thefinancialexpress.com.bd

Trade negotiation agency soon to secure benefits

LDC graduation on time despite tariff turmoil
Top-level meet chaired by CA decides

FE REPORT
Published :
Apr 16, 2025 00:20
Updated :
Apr 16, 2025 00:20

There is no going back for Bangladesh in its LDC graduation as the plane of status change has already taken off, a top-level meeting noted Tuesday and decided on measures to maximise its trade-economic benefits.


"One should keep it in mind that we are not on the ground--we are flying to the crew side. We were supposed to take off in 2024 but we got extra years due to the Covid," said special assistant to the Chief Adviser on finance Anisuzzaman Chowdhury in metaphorical terms after the meeting.

He was briefing the press on the review meeting on LDC graduation with Chief Adviser of the interim government Professor Muhammad Yunus presiding, explaining why the country cannot defer the graduation now when it is on the cusp of a domestic political transition.

"After reviewing the preparations we have been satisfied that our plane will fly smoothly, we have not seen that much possibility of a crash, and we will be able to reach the crew side by 2026," Mr Chowdhury, the head of an expert committee on LDC graduation, told reporters at the press briefing narrating the outcome of the review.

Advisers of the interim government from finance, commerce, education, planning, environment, and education ministries, the central-bank governor, the special assistant to the CA on economic affairs and the BIDA executive chairman were present at the meeting.

"There is no other option now. In today's meeting we discussed about our preparation in detail. And we have identified our strengths and weaknesses," he said.

"There can be pressure on our employment, on private sector, and we have to take precautions to address these," he added.

Responding to a question on possible challenges, he said building institutional capacity for trade negotiation is the top-most challenge for the post-graduation period.

"To address this, the meeting has decided to immediately set up a separate trade-negotiation agency. The chief adviser has instructed the meeting to find out an experienced and capable person to head this trade-negotiation body."

He also said professionals from government and from private sector would be incorporated into the proposed negotiation agency, which will be launched within a very short time.

Asked about demand from different trade bodies for deferring the graduation, he said deferment is out of question now and all have to understand that the country's plane of graduation is already in flying mode.

He also argues on this score that many fear of losing duty-free market access during the post-graduation period but already a number of countries have told Bangladesh that they will continue the facility for Bangladesh even after the graduation.

The European Union, a critical market for Bangladesh, has agreed to extend the duty-free facility after the graduation, he reminds. Australia and Japan have told (us) the same.

"And during the recent investment summit, the United Kingdom mentioned they will provide us with the duty-free facility even after the graduation," he says to make his point that deferment is not necessary.

In this connection he mentions that poorer countries like Bhutan and Samoa have already graduated from the LDC status.

Terming the Trump tariffs a major turbulence, he said efforts had been initiated to address the situation and the challenges of the US tariffs would not only be for Bangladesh but also for other countries as well.

Regarding the assessment that the country will lose US$10 billion in export earnings after graduation he said this figure was based on static data because this does not include the perspective that many of the major importers will continue to extend duty-free facilities.

Responding to a question on managing the impact of graduation on foreign aid as Bangladesh will be deprived of the concessional loan during the post-graduation era, he quipped dependence on aid is a "colonial hangover" and Bangladesh needs to get out of this spell.

He mentions that due to this dependency on foreign aid the country's tax-GDP ratio could not be raised.

Owing to an aid spree initiated after 2010, the tax-to-GDP ratio got reduced from 10 per cent in 2010 to 6.0 per cent, he said, adding that domestic resource mobilisation must be enhanced to ensure sustainable development.

Asked about the advantages of graduation, he said it would help in attracting foreign investment and in fulfilling the dream of turning the country into a manufacturing hub.

Shafiqul Alam, press secretary to the CA, said during the nearly two-hour meeting, the Chief Adviser directed all concerned to take steps to ensure maximum benefits as Bangladesh remains confident of smoothly graduating from the LDC status.

Prof Yunus mentioned that Bangladesh would be a "manufacturing and economic hub in the region" and discussed how to make it in a better way after the graduation from the club of world's least-developed countries.

The press secretary said the Chief Adviser also stressed the need for constant monitoring by a dedicated team so that no turbulence is seen on this journey as "it is very critical part".​

 

[Saif]

No pulling back on LDC graduation

The recent high-level meeting chaired by the Chief Adviser of the interim government has reaffirmed Bangladesh's commitment to graduate from the Least Developed Country (LDC) category in 2026. With this, any lingering uncertainty about deferring the transition has effectively been dispelled. As the

thefinancialexpress.com.bd

No pulling back on LDC graduation
Published :
Apr 17, 2025 21:52
Updated :
Apr 17, 2025 21:52

The recent high-level meeting chaired by the Chief Adviser of the interim government has reaffirmed Bangladesh's commitment to graduate from the Least Developed Country (LDC) category in 2026. With this, any lingering uncertainty about deferring the transition has effectively been dispelled. As the meeting aptly observed, the country's journey towards graduation, the long awaited milestone, has already taken off, there is no turning back.

While the milestone reflects remarkable progress achieved so far, it comes with significant challenges. Chief among them is the termination of trade preferences, which currently benefit the country due to its LDC status. Acknowledging this, the meeting highlighted the urgent need to build a strong institutional capacity for trade negotiations in the post-graduation landscape. To that end, it has been decided that a dedicated trade negotiation agency will be established immediately. The Chief Adviser has also made it plain that an experienced and competent individual will be appointed to head this new body.

LDC graduation, like many good things, comes with an opportunity cost-an economic trade-off, as economists would frame it. Graduation signifies more than just improved metrics on paper; it represents a belief by the international community that the graduating country has overcome structural weaknesses that once justified special and preferential support. Consequently, the privileges long enjoyed under the LDC category-such as concessional loans and preferential trade access-will gradually disappear. For decades, Bangladesh's economy has reaped substantial benefits from such supports, particularly under schemes like the Generalised System of Preferences (GSP). The rise of the country's apparel sector as a dominant player in global trading is attributed to such a preferential treatment. While global trends towards tariff reductions and regional agreements have already reduced some of these advantages, Bangladesh continues to be one of the largest beneficiaries of LDC-related trade preferences, especially from the EU. Culmination of preferences is thus the prime issue that worries the businesses. To address this, preparedness is paramount. The transition must be strategically managed to mitigate negative impacts and harness new opportunities. Economic resilience will depend on improving governance, boosting institutional efficiency, and embracing a forward-looking mindset. Dynamism in investment, job creation and productivity will also be essential to sustain post-graduation growth.

LDC graduation should not be viewed as an end in itself, but rather as the beginning of a new chapter. It marks a shift to a more competitive and self-reliant development path, where gains must be consolidated through consistent effort and reform. The emphasis must be on building a more productive and competitive economy-one that can thrive without special treatment and compete effectively in global market. The decision to move forward with LDC graduation is both bold and timely. While the road ahead is indeed complex, proactive measures-such as institutional strengthening and capacity building-will be key to navigating the post-graduation era. With vision, commitment, and strategic planning, the country can not only weather the transition but also emerge stronger and more resilient in the global economic landscape.​

 

[Saif]

Post-LDC challenges and the future of Bangladesh's exports

The path ahead is becoming clearer, and more complicated.

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Post-LDC challenges and the future of Bangladesh's exports
Bangladesh export future after LDC graduation

FILE VISUAL: SHAIKH SULTANA JAHAN BADHON

As Bangladesh approaches its graduation from the Least Developed Country (LDC) category, the anticipated challenges of losing preferential trade benefits are already manifesting. The United States has recently imposed a 37 percent reciprocal tariff on imports from Bangladesh, which is a significant blow to the latter's exports. Though the tariff's execution has been temporarily put on hold, if not resolved in time, this sudden increase threatens to erode the country's competitiveness in its largest export destination.

Concurrently, India has withdrawn the transshipment facility that previously allowed Bangladeshi exports to third countries via Indian ports and airports. This decision, which the Indian authorities claim is aimed at alleviating congestion and costs in India's own export channels, is expected to disrupt Bangladesh's export logistics, particularly affecting shipments to some countries. These developments underscore the urgent need for Bangladesh to diversify its export portfolio, invest in infrastructure development, revisit the trade architecture, and engage in strategic trade negotiations to mitigate the impacts of its LDC graduation.

The path ahead is becoming clearer, and more complicated. While diversification has long been a talking point, it is now a matter of survival. Relying on the export of ready-made garment (RMG) products alone is no longer an option. Bangladesh must invest in building up sectors that have already shown early signs of promise. Pharmaceuticals, ICT, and agro-processing are no longer fringe players. They are contenders, capable of anchoring the next chapter of the country's export story. Take pharmaceuticals, for instance. The world's appetite for generic medicine continues to grow, and Bangladesh has both the factories and the know-how to meet that demand. The transition from the LDC status could actually open the door for producing patented drugs, a game-changer if handled right.

But shifting what we sell is only half the equation. Where we sell must change too. For years, Bangladesh's export playbook has read like a short list: the European Union, the US, Canada—dependable, but limited. The world is bigger than that. Africa, South America, the Middle East and even some large economies in Asia are waking up as consumer markets. These are regions with rising demand, growing populations, and very few Bangladeshi products on their shelves. Cracking these markets will not be easy. It will mean understanding local tastes, building smarter logistics, and pricing with precision. But the opportunity is real, and the timing has never been better.

The other force reshaping competitiveness is less visible but equally powerful: technology. Automation, artificial intelligence, and real-time data have changed how factories run and decisions are made. In Bangladesh, these tools have been met with some hesitation, and understandably so. Fear of job losses is not unfounded. But the truth is, technology can enhance jobs as much as it replaces them. A sewing machine operator can become a line technician. A production supervisor can become a systems analyst. What is needed is training—not just any training, but programmes that are fast, focused, and aligned with the real industry needs. If done right, automation does not hollow out the workforce; rather it strengthens it.

None of this will matter, though, if the product gets stuck at port. Bangladesh has an infrastructure problem, which has been dragging down competitiveness for years. Roads get clogged too easily, customs clearances move too slowly, and ports often lag behind demand. The result is cost: exporters lose both money and time. According to the World Bank, logistics eat up nearly one-fifth of export costs in Bangladesh. That is double what many of our competitors face. Fixing this will take more than patchwork solutions. It will require a systemic overhaul—faster customs, smarter ports, and better roads—because the supply chain has to move as fast as the market it serves.

As the world grows more demanding, compliance is no longer a choice. It is the ticket to staying in the game. Product safety, labour rights, and environmental responsibility are the new benchmarks. Global buyers want transparency, certifications, traceability, and proof that what they are sourcing is ethical. This means companies must invest in more than just machines. They must invest in processes that show compliance and in people who can manage it. The government must play a part in this as well. Streamlined standards, quicker approvals, and constant engagement with exporters will make the difference between staying competitive and falling behind.

Trade diplomacy, once a quiet background act, now needs a front-row seat. The era of simply receiving trade perks is ending. Bangladesh must learn to negotiate on its own terms. It will not be easy, but the playbook is out there. Vietnam, with its network of deals stretching from Europe to Asia, has shown what is possible when trade is treated as strategy. Bangladesh has the size, the location, and the market to cut its own deals; what it needs now is the will to execute.

Sustainability, once seen as a luxury, is fast becoming a business requirement. Major retailers are making it clear: green practices are no longer treated as an add-on. And Bangladesh, surprisingly, is already ahead of the curve. The country is home to the largest number of certified green RMG factories in the world, which gives us a competitive edge. The next step is to scale that success and make it visible to the global consumer. Sustainability should not just be part of the story. It should be THE story.

The choices Bangladesh makes in the next few years will define the next few decades. Graduation from the LDC status is not the end of the journey, but the beginning of a harder one. A journey that will test the depth of strategy, the speed of execution, and the strength of collective will. But as history has shown, Bangladesh has never lacked resolve. The real question now is whether it can turn that resolve into reinvention.

Mamun Rashid, an economic analyst, is chairman at Financial Excellence Ltd and founding managing partner of PwC Bangladesh.​

 

[Saif]

Govt urged to move to defer country's graduation from LDC as it lacks readiness

Speakers from a diverse coalition of national and international stakeholders have urged the government to move a request to defer the country's graduation from the Least Developed Country (LDC) category, currently scheduled on 24 November 2026. They made the call at a roundtable on "Bangladesh's L

thefinancialexpress.com.bd

Govt urged to move to defer country's graduation from LDC as it lacks readiness
Published :
Apr 23, 2025 22:24
Updated :
Apr 23, 2025 22:24

Speakers from a diverse coalition of national and international stakeholders have urged the government to move a request to defer the country's graduation from the Least Developed Country (LDC) category, currently scheduled on 24 November 2026.

They made the call at a roundtable on "Bangladesh's LDC Graduation: Between Readiness and Reality," organised by the Change Initiative, a think tank, at a hotel in the city on Wednesday, UNB reports.

They cited those significant economic headwinds amid recent political turmoil and potential severe negative impacts if graduates with insufficient preparedness.

Estiaque Bari, head of research, Change Initiative in his keynote presentation underscored that Bangladesh’s upcoming LDC graduation is likely to impact 71.5% of its exports, with projected tariff hikes of 8.7% in the EU, 9.1% in the UK, and up to 15.8% in Japan for key sectors like footwear and garments.

“As Bangladesh prepares to graduate, with 81% of its exports dependent on the RMG sector and tariffs set to rise across key markets and product segments in the absence of critical trade agreements, the risks extend far beyond just the loss of trade and financial preferences”, he said.

Amir Khasru Mahmud Chowdhury, member, National Standing Committee of BNP, said "Bangladesh stands at an inflection point, but the foundation of its development narrative is hollow—manipulated figures, collapsed financial institutions, and a dangerously narrow export base.

“LDC graduation cannot be built on broken systems... True transition demands... people’s representation in decision-making. Without democratic legitimacy, no milestone is meaningful,” he added.

Zonayed Saki, chief coordinator, Ganosamhati Andolan, aligned with the perspective, “Graduation is inevitable-but the real question is: is today the right time? LDC status is not a matter of ego, it’s a matter of readiness.

Sadia Farzana Dina, joint chief coordinator of National Citizen Party said that without reliable data, institutional reform, and a national dialogue, rushing this transition could threaten our economic survival.

"The consensus emerging from this critical dialogue is clear: proceeding with LDC graduation in 2026, under the current circumstances, poses unacceptable risks to Bangladesh's economic stability and development gains," said M. Zakir Hossain Khan, chief executive of Change Initiative.

“LDC graduation is neither a badge of prestige nor a policy formality-it is a deeply political and structural shift”, he observed.

Professor Mushtaq Khan of SOAS, University of London, commented, “LDC status is not a formality-it’s a negotiated privilege tied to global protections. Bangladesh is on track to graduate, but without critical homework.

“We’re exiting while our banking system remains broken, our power sector contracts are riddled with corruption, and our export competitiveness is hollow beyond garments”, he said.

Representing the international business community, Nuria Lopez, Chairperson, European Union Chamber of Commerce in Bangladesh, stressed the human cost and the imperative for government action: “Without an extension, 2.5 million unskilled workers risk being left behind as green industries rise. Bangladesh must set aside ego and prioritize workforce upskilling, productivity, and investment in R&D to ensure a just transition”.​

 

[Saif]

'India will benefit from Bangladesh’s premature graduation’ from LDC status

One of the main beneficiaries would be India. If Bangladesh loses its trade privileges, India stands to gain the most.

en.prothomalo.com

Economist warns of danger
'India will benefit from Bangladesh’s premature graduation’ from LDC status

Staff Correspondent Dhaka
Published: 23 Apr 2025, 21: 35

Guests attend a roundtable discussion titled "Bangladesh’s Graduation from Least Developed Country (LDC) Status: Preparations and Realities" held today, Wednesday at a hotel in the capital. Photo: Prothom Alo

Economist Mushtaq Khan expressed concerns over Bangladesh’s lack of preparation for graduating from the United Nations' list of Least Developed Countries (LDCs).

He believes if Bangladesh graduates from LDC status, it will lose tariff-free trade benefits, face higher interest rates on foreign loans, and domestic industries will be exposed to intense competition, potentially leading to the shutdown of many factories.

Mushtaq Khan, a professor at the School of Oriental and African Studies (SOAS), University of London, shared these views at a roundtable discussion titled “Bangladesh’s Graduation from Least Developed Country Status: Preparations and Realities,” organized by the organisation Change Initiative at a hotel in Dhaka's Gulshan area today, Wednesday.

Politicians, economists, academics, researchers, and government officials attended the event.

Mushtaq Khan also said competitor countries want Bangladesh to graduate from LDC status, as it benefits them. One of the main beneficiaries would be India. If Bangladesh loses its trade privileges, India stands to gain the most.

He warned that if Bangladesh applies to the United Nations to delay its graduation, competitor countries might oppose it. They will desire that the application of Bangladesh is not considered.

At the event, Change Initiative’s Head of Research, Ishtiaq Bari, presented an overview of Bangladesh’s graduation process. He noted that Bangladesh has met all three criteria for LDC graduation and is scheduled to officially graduate on 24 November 2026.

In some regions, Bangladesh will continue to receive tariff-free access until 2029, and patent-related exemptions for pharmaceutical production will last until 2033.

In his presentation, Ishtiaq Bari noted that no country can unilaterally delay its graduation. To do so, a country must submit a request to the UN Committee for Development Policy (CDP) with strong supporting arguments. The CDP will then evaluate the request and a final decision will be made by the UN General Assembly.

After the July mass uprising, the interim government initially considered delaying the graduation but later withdrew from that plan. On 13 March, the Advisory Council decided to proceed with the graduation as scheduled.
As an LDC, Bangladesh currently enjoys duty-free export privileges in markets like Europe, access to low-interest foreign loans, and the ability to impose higher tariffs on imported goods. Graduation would mean losing these benefits and facing more competition from imported products with lower tariffs.

Mushtaq Khan asked, "Can Bangladeshi producers compete with products from China and India? Are the country’s electronics, processed food, and pharmaceutical industries ready? Is Bangladesh overall ready?"
He said, "I don’t see the evidence."

He highlighted a major concern regarding apparel exports to the European market: automatic tariff imposition. If a country’s exports exceed a certain threshold of the EU’s total imports for a particular product, tariffs are automatically applied. Bangladesh’s apparel exports have already crossed that threshold. Even though the EU has granted Bangladesh tariff-free access for three more years, this automatic tariff mechanism could reduce competitiveness.

Mushtaq also noted that a major European buyer has expressed concern over Bangladesh’s premature graduation.

He mentioned that Bangladesh might still be able to request a few extra years before graduating, by presenting three evidence-based arguments to the UN Economic and Social Council (ECOSOC):

Premature graduation could increase poverty in Bangladesh, which is a concern ECOSOC takes seriously.

Ongoing instability in global trade caused by US President Trump’s trade wars makes graduation risky.

Fifteen and a half years of authoritarian rule have severely damaged Bangladesh’s institutions and economy, requiring more time for recovery.

Mushtaq suggested Bangladesh engage with other countries like Nepal and Bhutan, which are also interested in delaying graduation. If Bangladesh makes the request alone, competitors like India might block it—especially since relations with India are currently not favourable.

He proposed that Bangladesh form a coalition with like-minded countries and approach the United Nations together, increasing the chances of securing a delay.

BNP standing committee member Amir Khasru Mahmud Chowdhury was present as a special guest. He questioned the economic data compiled under the ousted Awami League government, which has been used to justify LDC graduation. He mentioned issues like the troubled financial and banking sectors, and lack of export diversification.

Amir Khasru said that the graduation decision should reflect the will of the people. Over the past 15 years, Bangladesh lacked democracy, but now hopes for a return. A future elected government should make the final decision, following debates in parliament.

He emphasised the need to initiate efforts to delay graduation and allow the people’s representatives to debate and decide.

Cynthia Mela, Country Director of the French development agency AFD, Ayub Bhuiyan, General Secretary of the Press Club, AKM Sohel, additional secretary of the Economic Relations Division, Nuria Lopez, Chairperson of the EU Chamber of Commerce in Bangladesh, Mohammad Asaduzzaman, Co-founder of Dhaka Institute of Research and Analytics and Md Zakir Hossain Khan, CEO of Change Initiative, among others, spoke at the event.​

 

[Saif]

LDC graduation: Bilateral partnership agreements can mitigate loss of preferential access

Graduation from Least Developed Country (LDC) status to a developing nation is a new milestone in the development journey of Bangladesh. Upcoming graduation in November 2026 is a testimony of the strides that Bangladesh has made over the decades in improving income levels, reducing poverty and fost

thefinancialexpress.com.bd

LDC graduation: Bilateral partnership agreements can mitigate loss of preferential access
T I M Nurul Kabir
Published :
Apr 30, 2025 00:06
Updated :
Apr 30, 2025 00:06

Graduation from Least Developed Country (LDC) status to a developing nation is a new milestone in the development journey of Bangladesh. Upcoming graduation in November 2026 is a testimony of the strides that Bangladesh has made over the decades in improving income levels, reducing poverty and fostering human development. While exit from the LDC group is an obvious recognition of progress and economic maturity, graduation nonetheless poses a new set of challenges, especially for the export-oriented sectors.

As LDC, Bangladesh has been enjoying 'zero tariff benefits' under the Generalised Scheme of Preferences (GSP) of the European Union. 'Everything But Arms' (EBA) initiative was introduced in 2001, as per which almost all products, except arms and ammunition, originating from LDCs got duty-free and quota-free access to the EU market. Graduation from LDC will mark the end of trade benefits under the EBA regime for Bangladesh.

Bangladesh enjoys zero-duty benefits in developed and developing countries under the World Trade Organisation (WTO) declaration approving duty exemptions for all goods originating in LDCs. The US government did not fully comply with the declaration, and so garment exporters in Bangladesh have faced a 15.62 per cent duty on apparel exports to the US.

Bangladesh receives preferential treatment in 38 countries. Of the total merchandise shipped from Bangladesh annually, 73 per cent is LDC-induced. Around 84 per cent exports from Bangladesh comprises readymade garments (RMG).

The EU and the UK combined account for almost 60 per cent of merchandise exports from Bangladesh and more than 90 per cent of those export earnings come from RMG industry. Except for the US, which accounts for approximately 16 per cent of the exports, Bangladesh enjoys duty free market access in all major export destinations including Australia, Canada, India, Japan and China;.

Apart from direct trade benefits, Bangladesh enjoys Special and Differential Treatment (SDT), which includes Trade Related Intellectual Property Rights (TRIPS). Under the TRIPS agreement Bangladesh enjoys free access to numerous Intellectual Property Rights (IPRs). The TRIPS allows pharmaceutical companies in Bangladesh to manufacture patented drugs without paying royalty fees. Nullification of TRIPS after LDC graduation would affect the pharmaceutical industry adversely and put significant burdens on exporting industries reliant on the TRIPS agreement.

Once Bangladesh graduates from LDC category, local exporters may face an 11.5 per cent duty in major export destinations in the EU. On the other hand, duty imposed on exports in some emerging markets could be as high as 20 per cent in India and 18 percent in Japan. It is estimated that increased tariffs could result in decrease in exports ranging from 5.5 per cent to as high as 14 per cent. The loss of preferential market access, especially for the garments sector, will be a major challenge for Bangladesh after LDC graduation.

LDC graduation will also bring restriction on providing subsidies to bolster the export sector. So far, Bangladesh has been implementing extensive export subsidy programme to support the apparel and other export industries. According to the WTO rules, developing and developed nations are not allowed to provide direct cash subsidies on export receipts.

The WTO Ministerial Conference took the decision in 2024 to give preferential access facilities to graduating LDCs for three more years. The EU, the UK and some countries such as Canada and Australia have already agreed to continue duty-free access benefits for Bangladesh up to 2029. Trade relationship with Japan, China, South Korea and the South Asian countries will, however, depend on bilateral negotiations.

Graduating from the LDC group does not necessarily imply loss of preferential treatment. Developing Countries Trading Scheme of the UK would continue to provide improved market access after graduation to developing economy. Proactive engagements with the EU may pave the way to secure similar preferences.

An extension of the regular GSP, the GSP+ scheme is a special incentive arrangement for 'vulnerable developing countries'. The GSP+ scheme for Sustainable Development and Good Governance grants full removal of tariffs on over 66 per cent of EU tariff lines. To qualify for the GSP+ scheme, Bangladesh has to fulfill the 'vulnerability' criteria set by the European Union and ratify 27 international conventions. Moreover, Bangladesh is unlikely to qualify for being a large supplier to the EU, as under the GSP+ scheme an exporting country's share in total EU import should not exceed 7.4 per cent.

It is important for Bangladesh to maintain economic strength and resilience, which has been made obvious by the fact that Bangladesh has outperformed all previously graduated LDCs by fulfilling all three criteria of graduation: gross national income (GNI) per capita, human assets index (HAI), and economic and environmental vulnerability index (EVI). Fulfilling any two of the criteria would suffice for graduation from LDC.

To overcome the challenges arising from loss of preferential market access, Bangladesh needs to engage in proactive negotiations with major trading partners to sign Free Trade Agreements (FTAs), Economic Partnership Agreements (EPAs), Comprehensive Economic Partnership Agreements (CEPAs) and Preferential Trade Agreements (PTAs).

Bangladesh signed its first bilateral PTA with Bhutan in December 2020. Engagements for penning agreements with 13 major trade partners are ongoing, including China, India, Japan, and the US.

The first session of formal negotiation with Japan to sign a trade deal allowing manufacturers to retain duty-free export benefits after LDC graduation was held in Dhaka in May 2024. Both sides have set the goal to conclude the negotiations for signing EPA by December 2025. Japan is Bangladesh's 12th largest trading partner in exports and seventh-largest in imports.

Bangladesh and South Korea have begun negotiations to accelerate trade and investment growth through bilateral EPA. Both countries announced the commencement of these negotiations by signing a memorandum of understanding (MoU) in November 2024. The Republic of Korea was the first country to set up an exclusive foreign Export Processing Zone (KEPZ) in Bangladesh and is till date one of the top sources of Foreign Direct Investment (FDI). Bilateral trade between Bangladesh and Korea registered US$ 2.3 billion in 2023.

India is the largest neighbour and the second biggest trade partner of Bangladesh in Asia. Bilateral talks to initiate negotiations on a CEPA between Bangladesh and India have been underway, with the goal to enhance economic relations, streamline trade processes, and promote investment between the two countries.

It is also crucial for Bangladesh to forge strategic regional and global partnerships to maintain growth as a developing economy. Strengthening economic partnerships with emerging economies and exploring new markets in Asia, Africa, and Latin America would widen up opportunities of growth as well as mitigate the risks associated with overreliance on developed markets in EU and the US.

Overreliance on the RMG sector makes Bangladesh economy vulnerable in face of tariffs and external shocks. Bangladesh has to prepare cautiously to navigate transition to developing economy and accelerate its economic diplomacy engagements to mitigate the impact of lost preferential access. It is imperative for Bangladesh to take up pragmatic steps to protect its dominant industry and speed up efforts for economic diversification.

T I M Nurul Kabir, Executive Director, Foreign Investors Chamber of Commerce and Industries (FICCI) is an analyst on Business, Technology and Policy.​

 

[Saif]

Bangladesh lags behind Ldc-graduating peers in public spending and revenue mobilisation efforts

Bangladesh’s fiscal deficit is projected to remain above 4 percent of GDP through 2026, as revenue growth continues to fall short of expanding public expenditure.

www.thedailystar.net

Bangladesh lags behind Ldc-graduating peers in public spending and revenue mobilisation efforts

Bangladesh's fiscal deficit is projected to remain above 4 percent of GDP through 2026, as revenue growth continues to fall short of expanding public expenditure.

Despite rising development needs, the country allocates a significantly smaller share of its economic output to public spending than its South and Southeast Asian peers. In 2025, Bangladesh's public expenditure stood at just 13.0 percent of GDP, compared to 23.4 percent in Nepal, 18.4 percent in Lao PDR, and 17.9 percent in Cambodia. The trend is expected to persist in 2026, with Bangladesh projected to spend 14.0 percent of GDP.

At the same time, Bangladesh's revenue mobilisation remains among the weakest in the region. Government revenue is forecast to rise to only 9.8 percent of GDP by 2026, well below levels seen in countries with comparable or even lower income levels.

Public debt is rising gradually but remains modest relative to regional norms. Bangladesh's debt-to-GDP ratio is expected to reach 40.7 percent in 2026, up from 37.9 percent in 2022. Economists view the trajectory as broadly sustainable, though they caution that further borrowing capacity may depend on tangible improvements in tax collection and the efficiency of public investment.​

 

[Saif]

Govt for swift, coordinated action for LDC graduation

Chief adviser Muhammad Yunus on Sunday called for urgent and coordinated action from all relevant agencies to ensure Bangladesh’s smooth and timely graduation from least developed country status...

www.newagebd.net

Govt for swift, coordinated action for LDC graduation
Bangladesh Sangbad Sangstha . Dhaka 11 May, 2025, 22:43

Muhammad Yunus

Chief adviser Muhammad Yunus on Sunday called for urgent and coordinated action from all relevant agencies to ensure Bangladesh’s smooth and timely graduation from least developed country status.

He made the call during a high-level meeting with LDC Graduation Committee at the state guest house Jamuna, where progress on key deliverables was reviewed.

‘This whole thing is about coordination,’ the chief adviser said.

‘We already have the attention and support of investors, funders and development partners. Now, we must build on the efforts already underway and intensify our collective action to move forward with speed and purpose,’ he said.

Emphasising the importance of institutional readiness, Yunus called upon all stakeholders to move in unison.

‘We need a team that functions like firefighters. When the whistle blows, they must respond-fast, efficiently, and without delay and stay at the problem until it is solved,’ he said.

The chief adviser further assured that the Chief Adviser’s Office would take an active role in overseeing the process.

‘The highest office of the government will personally monitor the implementation of all graduation-related initiatives,’ he added.

During the meeting, the LDC Graduation Committee identified five priority actions that must be completed on an urgent basis.

The actions are: making National Single Window fully operational with participation from all relevant agencies; implementation of National Tariff Policy, 2023 through a clear action plan; execution of key measures under National Logistics Policy, 2024, including infrastructure projects; operational readiness of Effluent Treatment Plant at Savar Tannery Village; and full-scale operation of Active Pharmaceutical Ingredient Park in Gajaria, Munshiganj.

‘These aren’t just routine tasks-we need to see them as key steps, each one helps clear the way for our graduation and builds a stronger, fairer economy for everyone’, the chief adviser added.

Finance adviser Salehuddin Ahmed, chief adviser’s special assistant Anisuzzaman Chowdhury and special envoy for international affairs Lutfey Siddiqi attended the meeting, alongside members of the LDC Graduation Committee and policy advisers.​

 

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Budget should draw clear roadmap for smooth LDC GRADUATION

The upcoming national budget must outline a comprehensive roadmap to prepare for the country’s graduation from the least developed country (LDC) club in 2026, prioritising tariff rationalisation, tax reform, and sustainable fiscal policies, according to a leading business leader.

www.thedailystar.net

Budget should draw clear roadmap for smooth LDC GRADUATION
Says FICCI President Zaved Akhter in an interview with The Daily Star

Zaved Akhter

The upcoming national budget must outline a comprehensive roadmap to prepare for the country's graduation from the least developed country (LDC) club in 2026, prioritising tariff rationalisation, tax reform, and sustainable fiscal policies, according to a leading business leader.

"As Bangladesh approaches LDC graduation, the budget must demonstrate our readiness through tariff rationalisation and tax reforms," said Zaved Akhter, president of the Foreign Investors' Chamber of Commerce and Industry (FICCI).

In an interview with The Daily Star, Zaved emphasised fiscal measures that support compliant labour practices, sustainable business models, and alignment with environmental, social, and governance (ESG) standards -- key considerations for the post-LDC landscape.

First and foremost, he said that Bangladesh's tax system must be simplified by introducing a unified national value-added tax (VAT) rate.

"Our tax structure is complex, with multiple VAT rates across sectors. We need to simplify it by adopting a single national VAT rate, akin to the goods and services tax (GST) model used in other countries," said the FICCI president.

The existing system, fragmented by varying rates, creates confusion and compliance issues, according to the business leader. The question now, he said, is how effectively this transition can be implemented.
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"We cannot impose a unified VAT nationwide overnight. Instead, we should pilot it in a specific region, assess its impact on revenue collection, and then gradually expand to other areas and sectors," suggested Zaved, who is also the chairman and managing director of Unilever Bangladesh Ltd.

He advocated for reducing reliance on indirect taxes by broadening the direct tax base.

"We need to focus on expanding the tax net to capture more taxpayers, instead of over-relying on regulatory and supplementary duties," he said.

Zaved also called for transforming customs from a revenue-centric body to a facilitative agency.

"There's a misconception that customs only exist for revenue collection. It must also act as a facilitator," he said, adding, "We need an integrated digital information network that connects all tax departments."

Currently, these departments rarely communicate, hindering effective revenue collection, he commented.

"Better coordination with other government agencies could unlock significant revenue potential. If such interconnection is enabled, different government verticals could synchronise their services," Zaved said.

On the National Board of Revenue's (NBR) push towards cashless transactions, he said, "We talk about a cashless society, yet the infrastructure is far from ready. So how can we realistically transition to it?"

Sharing a personal experience, the Unilever Bangladesh chairman said, "Despite all the talk of a 'cashless market', when I pay VAT to the government, it can't be done digitally. I have to withdraw cash and pay the relevant officials. Why can't it go through the system directly?"

Therefore, he urged the authorities to raise the Tk 36 lakh cap on annual cash transactions to qualify for the reduced 25 percent corporate tax rate.

"We are hopeful that the NBR will introduce a forward-thinking, investor-friendly revenue policy -- one that curbs leakages while encouraging a competitive tax environment," he said.

'POLICY CONSISTENCY A MUST FOR ATTRACTING FDIs'

Foreign direct investment (FDI) in Bangladesh has remained persistently low, hovering below 1 percent of gross domestic product (GDP).

"We're even trailing behind Pakistan in attracting FDI," Zaved said.

But Bangladesh holds huge potential to draw foreign investment in sectors such as leather and agricultural processing, from farm-level operations to the full supply chain.

"To tap into this potential, policy consistency is crucial. One of our biggest weaknesses is the frequent and abrupt policy shifts," he said.

The business leader cited a recent example of an incentive scheme for electronics products that was withdrawn without prior notice last year.

"I understand the government had its reasons, but you can't just pull an incentive mid-flight. Investors might have already set up factories based on that incentive. At the very least, you should announce a future termination date rather than a retroactive withdrawal," he said.

Reflecting on the recent Bangladesh Investment Summit, Zaved said, "The summit helped restore some credibility for Bangladesh. It sent a positive signal that the country remains on track despite recent political changes."

'REFORM TO RETAIN INVESTORS'

The FICCI president identified two major reforms to increase investment. First, the separation of the NBR's policy and administrative functions, a process that is already underway.

Secondly, he sought the consolidation of investment facilitation agencies.

At present, investors navigate multiple agencies, such as Bangladesh Export Processing Zones Authority (Bepza), Bangladesh Investment Development Authority (Bida), Bangladesh Economic Zones Authority (Beza), Hi-Tech Park Authority, which he said "creates unnecessary confusion".

Zaved urged the government to set up a single investment authority to simplify the services.

"Investors shouldn't be running between 141 departments to get approvals. We need a genuine one-stop service that handles everything from licences to utilities -- like a relationship manager in banking," he said.

"If Bangladesh remains complicated while other countries simplify their systems, we'll keep losing out," he added.​

 

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ICCB for strong SMEs to overcome LDCs challenges

International Chamber of Commerce Bangladesh (ICC-B) on Monday laid emphasis on strengthening SMEs to overcome challenges Bangladesh will face after its graduation from Least Developed Countries...

www.newagebd.net

ICCB for strong SMEs to overcome LDCs challenges
Bangladesh Sangbad Sangstha . Dhaka 12 May, 2025, 22:59

International Chamber of Commerce Bangladesh (ICC-B) on Monday laid emphasis on strengthening SMEs to overcome challenges Bangladesh will face after its graduation from Least Developed Countries.

‘SMEs are the backbone of any economy for its growth, development and employment generation. With the graduation to middle income country in 2026, Bangladesh will be facing tight competition from its competitors. Strengthening the SMEs will make immense contributions in the entire supply chain process,’ said ICCB vice-president A K Azad.

He said this while inaugurating a workshop on ‘Find and pursue the right standards for your business: A Hands-on workshop with the SME Toolkit in collaboration with the Asian Development Bank’s (ADB) Trade and Supply Chain Finance Program (TSCFP) and International Trade Centre (ITC)’ in the city, said a press release.

ICCB secretary general Ataur Rahman moderated the session while ITC associate programme officer Dang Tuan Ducand and software engineer Niklas Anders ANDERSSON delivered their presentations on different topics during the workshop.

Azad said Bangladesh also has to be compliance and ensure sustainability for export growth.

As such today’s workshop has been organized to engage textile, apparel, and footwear manufacturers in the pilot testing of the ITC or ADB Sustainability Standards Navigation Toolkit, he added.

He said the Toolkit has developed to help SMEs enhance their awareness of sustainability standards, assess their readiness for certification, and receive actionable recommendations for sustainable practices and compliance for export.

Azad thanked ADB TSCFP and ITC for taking the initiative in developing the toolkit and ensure that ICC Bangladesh will continue to organize workshops for strengthening the capacity of the SMEs to increase their exports.

About 40 participants from SMEs including apparels, textiles & leather industries and other corporate houses attended the workshop.​

 

[Saif]

Stakeholders urge Bangladesh to prepare for challenges ahead of LDC graduation

As Bangladesh prepares to graduate from Least Developed Country (LDC) status in 2026, stakeholders at a seminar underscored the urgent need for strategic preparation to overcome post-graduation challenges. With the imminent loss of duty-free market access, GSP benefits, and other trade incentives,

thefinancialexpress.com.bd

Stakeholders urge Bangladesh to prepare for challenges ahead of LDC graduation
FE ONLINE REPORT
Published :
May 15, 2025 17:12
Updated :
May 15, 2025 17:12

As Bangladesh prepares to graduate from Least Developed Country (LDC) status in 2026, stakeholders at a seminar underscored the urgent need for strategic preparation to overcome post-graduation challenges.

With the imminent loss of duty-free market access, GSP benefits, and other trade incentives, they emphasised that Bangladesh must enhance product quality, diversify exports, adopt modern technologies, and explore new markets to remain competitive in the global arena.

They made their remarks at a programme titled “Validation Workshop on 'Factory Audit on Hazard Identification, Risk Assessment & Control” and a seminar on “LDC Graduation Strategies and Private Sector Preparedness” at a Dhaka city hotel on Thursday.

The Bangladesh Plastic Goods Manufacturers & Exporters Association (BPGMEA), in collaboration with the Business Promotion Council (BPC) under the Ministry of Commerce, organised the event.

Mahbubur Rahman, Secretary of the Ministry of Commerce, attended the event as chief guest.

Mrs Nahid Afroze, Joint Secretary, Ministry of Commerce and CEO of the Business Promotion Council (BPC), and Md Abdur Rahim Khan, Additional Secretary, Ministry of Commerce and Project Director of EC4J, were present as special guests.

The keynote paper for the validation workshop was presented by S. M. Saiful Islam, Lead Assessor, Imarat Designers & Consultants, while the keynote for the LDC seminar was delivered by Ms Ferdaus Ara Begum, CEO of Business Initiative Leading Development (BUILD).

Samin Ahmed, President of BPGMEA, delivered the welcome speech at the event.

Senior representatives and officials from BPGMEA, BPC, EC4J, and various member organisations participated in the workshop and seminar.

Speakers emphasised that workplace hazards and accidents not only endanger workers and their families but also negatively affect productivity and overall societal well-being.

The primary aim of safety audits in the plastic manufacturing and exporting industry is to raise awareness among employers, employees, and management in order to create and foster a culture of safety. This includes identifying hazards, preventing accidents and injuries, managing risks, ensuring compliance, and promoting continuous safety improvements.

The Ministry of Commerce, through the BPC, is financing initiatives to strengthen the plastic industry’s resilience, with BPGMEA playing a key partnership role in the process.​

 

[Saif]

Bangladesh must prepare strategically, say experts

As Bangladesh is scheduled to graduate from the least-developed country (LDC) status in 2026, businesses and trade experts on Thursday stressed the urgent need for strategic preparation to overcome the post-graduation challenges. With the impending loss of duty-free market access, GSP benefits, an

thefinancialexpress.com.bd

Overcoming post-graduation challenges
Bangladesh must prepare strategically, say experts

FE REPORT
Published :
May 16, 2025 08:19
Updated :
May 16, 2025 08:19


As Bangladesh is scheduled to graduate from the least-developed country (LDC) status in 2026, businesses and trade experts on Thursday stressed the urgent need for strategic preparation to overcome the post-graduation challenges.

With the impending loss of duty-free market access, GSP benefits, and other trade incentives, they emphasised that Bangladesh must improve the quality of products, diversify exports, adopt modern technologies, and explore new markets to remain competitive in the global market.

They made their remarks at a validation workshop on "Factory Audit on Hazard Identification, Risk Assessment & Control" and a seminar on "LDC Graduation Strategies and Private Sector Preparedness" at a city hotel.

The Bangladesh Plastic Goods Manufacturers & Exporters Association (BPGMEA) in collaboration with the Business Promotion Council (BPC) of the Ministry of Commerce organised the event. Commerce Secretary Mahbubur Rahman attended as the chief guest.

Mrs. Nahid Afroze, joint secretary at the MoC and CEO of the BPC, and Md. Abdur Rahim Khan, additional secretary at the MoC and Project Director of EC4J, were present as the special guests.

The keynote paper for the validation workshop was presented by S. M. Saiful Islam, Lead Assessor at the Imarat Designers & Consultants, while the keynote for the LDC seminar was delivered by Dr Ferdaus Ara Begum, CEO of the Business Initiative Leading Development (BUILD).

In his welcome address, BPGMEA President Samin Ahmed expressed concern over Bangladesh's upcoming graduation.

"We are uncertain about what lies ahead of us after the LDC graduation. Therefore, we must be well-prepared to tackle the potential challenges," he said.

While delivering her presentation, Dr. Ferdaus Ara stressed the need for extending back-to-back L/C (letter of credit) facilities to all exporters, not just the 100 per cent export-oriented ones.

She pointed out that limited access to bonded warehouse facilities is a major barrier for non-RMG sectors.

She also noted that exporters prefer the Export Development Fund (EDF) to the new Facilitation Pre-Finance Fund (EFPF), as the EDF is disbursed in foreign currency.

To make EFPF more effective, she recommended raising its ceiling, lowering interest rates, and digitising the process.

Commerce Secretary Mahbubur Rahman said, "We should address the challenges associated with graduation from the LDC status. Having graduated in 2021, we are currently in the grace period, which offers a window of opportunity to prepare for a smooth transition."

To boost export growth, the government plans to engage in sector-wise discussions with the stakeholders from each industry, he said.

Regarding Free Trade Agreements (FTAs), Bangladesh must move forward with careful consideration and strategic thinking to ensure that Bangladesh gains mutual benefits, Mr Rahman suggested.

The global plastics market is even larger than the global apparel market. Therefore, the plastic sector must prioritise diversification to realise its full export potential, he added.

Speakers also emphasised that workplace hazards and accidents not only endanger workers and their families but also affect productivity and overall societal well-being.

The primary aim of safety audits in the plastic manufacturing and exporting industry is to raise awareness among employers, employees, and management to foster a culture of safety.

These include: identifying hazards, preventing accidents and injuries, managing risks, ensuring compliance, and promoting continuous safety improvements.

The MoC, through the BPC, is financing initiatives to strengthen the plastic industry's resilience, with BPGMEA playing a key partnership role in the process.

Senior representatives and officials from BPGMEA, BPC, EC4J, and various member organisations participated in the event.​

 

[Saif]

Bangladesh will graduate from LDC bracket on time: Finance Adviser

Finance Advisor Salehuddin Ahmed is positive that Bangladesh will graduate from the Least Developed Country (LDC) bracket as scheduled in 2026. Speaking at an event in Dhaka on Saturday, he said the matter has drawn a lot of attention lately, and insisted: “There's been a lot of discussion a

thefinancialexpress.com.bd

Bangladesh will graduate from LDC bracket on time: Finance Adviser
Published :
May 17, 2025 17:37
Updated :
May 17, 2025 17:37

Finance Advisor Salehuddin Ahmed is positive that Bangladesh will graduate from the Least Developed Country (LDC) bracket as scheduled in 2026.

Speaking at an event in Dhaka on Saturday, he said the matter has drawn a lot of attention lately, and insisted: “There's been a lot of discussion about whether we should graduate or not. But we decided that [we will] and we will go for it.

“We will do everything to prepare for that.”

Bangladesh is set to graduate from the LDC bracket, designated by the UN Committee for Development Policy, on Nov 24, 2026. The chief advisor recently instructed all relevant agencies to take prompt and coordinated steps to move Bangladesh to the developing nations category.

Salehuddin called on the business community to step forward to facilitate the transition, reports bdnews24.com.

"We will go faster, not slowly, because other countries have come a long way. Let us not get stuck in one place."

Bangladesh has been on the UN list of LDCs since 1975 and met the eligibility criteria for graduation in 2018, based on three indicators: per capita income, human asset development, and economic vulnerability.

The UN General Assembly, during its 76th session on Nov 25, 2021, recommended Bangladesh's graduation.

As a least developed country, Bangladesh enjoys duty-free and quota-free access to the European export market. If it upgrades into a developing country, these perks will no longer be available.​

 

[Saif]

Must proceed with LDC graduation despite hurdles

Graduating from the least developed country (LDC) category will be a challenge for Bangladesh and there are many debates surrounding it, but the country has to graduate by 2026, Finance Adviser Salehuddin Ahmed said yesterday.

www.thedailystar.net

Must proceed with LDC graduation despite hurdles
Salehuddin says

Graduating from the least developed country (LDC) category will be a challenge for Bangladesh and there are many debates surrounding it, but the country has to graduate by 2026, Finance Adviser Salehuddin Ahmed said yesterday.

He added that businesses in Bangladesh will have to move faster to ensure the country does not fall behind, as other countries are progressing rapidly.

The adviser made the comments while speaking as the chief guest at the launch event of five new card services by Mercantile Bank, in association with Mastercard, in the capital.

"We are committed to encouraging digital transactions as much as possible, as they ensure greater transparency and traceability," Ahmed said.

He added that although digital adoption is growing, it is important to address the concerns people face, such as excessive questioning by banks, which often hinders broader participation.

Credit cards, in particular, play a crucial role in facilitating remittances and driving financial inclusion.

"I extend my best wishes to both Mercantile Bank and Mastercard for their continued efforts in advancing private sector development and promoting digital transformation in the financial ecosystem."

Mati Ul Hasan, managing director of Mercantile Bank PLC, stated that the initiative aligns with their broader goal of supporting Bangladesh's transition toward a cashless, digitally empowered society.​

 

[Saif]

Graduation from LDC by 2026 on track: Salehuddin

The finance adviser has said Bangladesh will graduate from the Least Developed Country (LDC) category to a developing country next year despite opposition. "We are trying to graduate as a developing country by 2026. There has been a lot of discussion about this-whether we should go for graduation

thefinancialexpress.com.bd

Graduation from LDC by 2026 on track: Salehuddin
FE REPORT
Published :
May 18, 2025 09:19
Updated :
May 18, 2025 09:19

The finance adviser has said Bangladesh will graduate from the Least Developed Country (LDC) category to a developing country next year despite opposition.

"We are trying to graduate as a developing country by 2026. There has been a lot of discussion about this-whether we should go for graduation or not-but we have decided that we will go for it," Finance Adviser Dr. Salehuddin Ahmed said.

"Whatever preparations are needed, we will make them," he added.

He made the remarks while addressing as chief guest a ceremony to launch Mastercard portfolio of Mercantile Bank at a hotel in the capital on Saturday.

The finance adviser said he expected that the country's business community would actively participate in the graduation process.

Hailing Mercantile Bank and Mastercard for their collaboration, the Adviser said it would help expand the idea of cashless society in the country.

Though there are some challenges in the banking sector, situation is improving, said Mr Ahmed, who once headed the Bangladesh Bank (BB) as its governor.

BB Deputy Governor Zakir Hossain Chowdhury and Chairman of Mercantile Bank Anwarul Haque spoke on the occasion as special guests.

The bank's board of directors and senior officials of the bank and Mastercard were present on the occasion.

They unveiled new cards at the ceremony.

The portfolio includes Mastercard Titanium Credit Card, World Mastercard Credit Card, Mastercard Debit Card, Mastercard Platinum Global Debit Card, and a Mastercard Prepaid Card.

Equipped with contactless technology, dual-currency support, and robust two-factor authentication, these cards offer cardholders a seamless and secure payment experience for both domestic and international transactions.​

 

[Saif]

Graduation from LDC club to create some opportunities: BB Governor

Bangladesh Bank Governor Dr Ahsan H. Mansur said that graduation from the Least Developed Countries (LDC) would create some opportunities for Bangladesh, despite the businesses having some observations. He said there is no country like Bangladesh left among the LDCs. He made the remark on Tuesday

thefinancialexpress.com.bd

Graduation from LDC club to create some opportunities: BB Governor
FE REPORT
Published :
May 21, 2025 10:11
Updated :
May 21, 2025 10:11

Bangladesh Bank Governor Dr Ahsan H. Mansur said that graduation from the Least Developed Countries (LDC) would create some opportunities for Bangladesh, despite the businesses having some observations.

He said there is no country like Bangladesh left among the LDCs.

He made the remark on Tuesday night at the inauguration ceremony of a new platform, the Climate Action and Sustainability Hub (CASH) in a hotel in the capital.

The initiative is a joint effort by the Policy Research Institute (PRI) of Bangladesh, the Centre for Climate Change and Environmental Research (C3ER) at BRAC University, and Sharp Consulting Bangladesh Limited, said organizers of the event.

While speaking as chief guest at the event, the governor said, “in Asia only Afghanistan remains; in Africa, there are countries like Congo and Somalia. So why should we still be on this list? I don't find it acceptable."

He added, "It is necessary for us to move beyond this classification. Despite objections from some in the business sector, I firmly believe LDC graduation will ultimately benefit Bangladesh."

AKM Sohel, Additional Secretary at the Economic Relations Division (ERD) said at the event, windows of soft loans and preferential market access of product will be closed or reduced.

The only sector where the global funds will remain open for grants or concessional loans is climate changes as Bangladesh is the largest climate disaster prone area. Dr Ainun Nishat, Chairman of CASH, said the flood that struck Florida last year reached a height of 17 feet.

"Our embankment stands at just 15 feet - and it's already damaged. Even a smaller flood could cause severe devastation," he said.

If a flood of similar magnitude hits Bangladesh, it could result in the death of at least 50,000 people, he said.

Dr Ainun Nishat criticized the Delta Plan 2100, calling it a deceptive initiative, and argued that it lacks concrete, project-specific details.

He claimed that the plan merely repackages over 80 development projects that were originally identified back in the decade of 1960s.

Dr Selim Raihan, Executive Director, SANEM said at the event capacity building and managing data are important issue for the macro economy particularity climate change issue.

Sayed Nasim Manzur, President of the Leathergoods and Footwear Manufacturers and Exporters Association of Bangladesh, emphasized the need for a unified and non-discriminatory enforcement of environmental regulations.

He also stressed that the enforcement mechanism should not be overly centralized, and local governments must be empowered to play a stronger role in this area.

The organiser said at the event the platform is expected to accelerate the country's transition to a low-carbon, climate-resilient economy.

With climate risks intensifying and growing demands for sustainability disclosures and ESG compliance, CASH is positioned to support organizations in aligning with international standards, accessing climate finance, and developing sustainability leadership.

Despite the presence of national policies, the country still faces major implementation challenges - a gap CASH seeks to close.

The hub envisions positioning Bangladesh as a regional leader in sustainability by empowering organizations and communities to adopt environmentally responsible and socially equitable practices.

Its mission focuses on promoting inclusive sustainability actions through cutting-edge research, policy innovation, capacity building, and advocacy.

Eminent climate expert Dr Ainun Nishat will serve as Chairman of CASH.

The Board of Trustees will include Dr Zaidi Sattar, Dr Bazlul Haque Khondker, Al Maruf Khan, Roufa Khanum, Kazi Imtiaz Hossain, and Zakir Ahmed Khan.

The focus area of the CASH will be policy advocacy, capacity development, Knowledge dissemination, public engagement, research, and green and climate finance solution.​

 

[Saif]

Govt spending in Bangladesh lowest among LDC graduating peers

Bangladesh’s public spending as a share of gross domestic product (GDP) is the lowest among nations on course to graduate from the least developed country (LDC) club.

www.thedailystar.net

Govt spending in Bangladesh lowest among LDC graduating peers

Bangladesh's public spending as a share of gross domestic product (GDP) is the lowest among nations on course to graduate from the least developed country (LDC) club.

Economists say that this low level of expenditure, both operational costs and development outlays, could weaken the foundations of the country's transition and leave the economy vulnerable on several fronts once it loses LDC status.

Following graduation, Bangladesh will no longer enjoy preferential trade access in many global markets and will face tighter terms when seeking foreign loans.

To minimise these shocks, analysts say the government must strengthen the economy through higher investment in key sectors.

They say Bangladesh must ramp up spending on education, healthcare, infrastructure, and social protection to create the conditions typical of a developing economy.

In 2025, the country's public expenditure stood at just 13 percent of GDP, below the 23.4 percent in Nepal, 18.4 percent in Laos, and 17.9 percent in Cambodia.

The International Monetary Fund (IMF) projects that Bangladesh will raise this figure only marginally to 14 percent in 2026.

Economist Mustafizur Rahman said low revenue collection has forced the government to curtail both its operating and development budgets.

"In developed countries, public spending usually accounts for 35 percent to 40 percent of GDP. In other South Asian nations, it is around 20 percent. But in Bangladesh, it has hovered around 12 percent historically," Rahman said, citing IMF data.

"If the government intends to spend more, it must either tolerate a higher budget deficit or increase revenue collection," added Rahman, a distinguished fellow at the local thin tank Centre for Policy Dialogue (CPD).

At present, revenue-to-GDP ratio of Bangladesh stands at just 7.3 percent -- lower than that of Nepal, Bhutan, and several other regional peers.

"So, the original sin is the low tax collection," Rahman said. "On top of that, not all revenue reaches the public coffers due to systemic leakages."

He mentioned that the government is reluctant to raise the budget deficit as it would increase the debt servicing burden. "Already, interest payments have overtaken education as the largest expenditure item in the national budget."

The United Nations General Assembly endorsed the graduation of several LDCs.

Bangladesh, Laos, and Nepal are scheduled to graduate in 2026. The Solomon Islands will follow in 2027, with Cambodia and Senegal set to graduate in 2029.

After the graduation, Bangladesh will need to become more competitive and productive to survive in a less preferential global environment, said Prof Mohammad Lutfor Rahman, an economics teacher at Jahangirnagar University.

"This calls for strong and large government investments," Rahman said.

According to him, if the government fails to invest adequately in health, education and infrastructure, the country's development may falter.

A CPD report shows that health allocations have remained below 1 percent of GDP for two decades, while education spending was slightly higher to 1.69 percent of GDP in fiscal year 2025.

"To improve outcomes in health and education, a country needs to spend at least 5 percent of GDP in each area. Bangladesh still falls far short of that benchmark," said the economics professor.

He also pointed out that budget implementation remains a persistent problem. "Even when allocations rise, actual spending falls short. Implementation efficiency is falling and leakages are worsening."

According to Ministry of Finance, the budget implementation rate dropped to 84 percent in fiscal year 2022–23, down from 91 percent a decade ago.

CPD Distinguished Fellow Rahman recommended increasing tax collection, plugging leakages, improving tax administration and accelerating digital reforms.

With stronger revenue streams, he said, the government could boost investment in human capital and infrastructure -- sectors that are critical for helping local businesses compete internationally.

Similarly, Prof Rahman advocated for greater spending in education, health and infrastructure, alongside better implementation and tighter control over financial leakages.​

 

[Saif]

Reforms urgent before graduation

Complicated work procedures at government offices that *&*&*&*&*&*& service delivery is a legacy hampering the country's growth since its birth. The call for revamping and streamlining it by all concerned is also not new. But the self-serving, archaic system is so deeply entrenched that it still lives on

thefinancialexpress.com.bd

Reforms urgent before graduation

Published :
Jun 17, 2025 00:05
Updated :
Jun 17, 2025 00:05

Complicated work procedures at government offices that *&*&*&*&*&*& service delivery is a legacy hampering the country's growth since its birth. The call for revamping and streamlining it by all concerned is also not new. But the self-serving, archaic system is so deeply entrenched that it still lives on. As a precondition for extending their development support, the UN bodies and various multilateral lending agencies have been recommending changes including reforms in this rigid civil service procedures. Now criticism against this anti-progress, anti-growth bureaucracy is being raised even by countries and overseas business houses who have been tested partners in Bangladesh's development initiatives since long. Notably, some South Korean business houses first took an active interest in the country's textiles sector when the Readymade garment was a fledgling industry in the 1980s. Naturally, like other development partners, they have a stake in Bangladesh economy's better performance so that overseas investors including their own companies might continue to show interest in doing business with Bangladesh.

In this connection, the South Korean ambassador to Bangladesh at a recent seminar styled 'Korea-Bangladesh Economic Cooperation' in Dhaka organized by the 'Foreign Investors' Chamber of Commerce and Industry' pinpointed some areas in the bureaucracy as well as policy that are acting as barriers to foreign direct investments (FDIs) in the country. For instance, the customs clearance procedure and visa rules for foreign investors were the areas that came under close scrutiny. In fact, it is a colonial notion that businesses whether local or foreign should experience the ordeal of a protracted approval procedure involving multiple desks and an inordinate amount of time before a cargo is cleared or a permission is issued. Those were not business-friendly times when such arcane rules and procedures were conceived and practiced. But despite all the calls for change and reforms, the systems thrives to the detriment of business at home as well as others who are willing to invest in Bangladesh. Though many local businesses might have resigned to comply with the existing order of things, why should one expect the same kind of allegiance from an overseas investor?

Given the long and tardy bureaucratic procedures to get any business deal done, the usual short-term visa for a stay of, say, 90 days, is definitely not a welcome approach to a prospective overseas investor. It was exactly such barriers to effective partnership with foreign businesses that figured prominently at the discussion event in question. Alongside the procedural aspects, some policies that successive governments adopted from time to time have often amounted to stymieing the economy's overall competitiveness with regional and international peers. The higher tariffs against imports, for instance, have proved to be disincentive for overseas businesses intending to invest in the country. So, it is no surprise that at 0.75 per cent, Bangladesh's FDI-to-GDP ratio is the lowest in the region with India's at 1.7 per cent, while Southeast Asia's Vietnam at an impressive 4.7 per cent. These are the areas that call for urgent addressing from the government. As expected, the Korean diplomat's observations on these existing bottlenecks that slow down the pace of service delivery and thereby impact Bangladesh's business competitiveness could not have come at a better time, particularly when the country's graduation from the LDC category is on the doorstep. Needless to say, once exemptions from various tariff and non-tariff barriers that Bangladesh have been enjoying so far as a member of the LDCs are gone with its graduation, adequate preparedness should be there to face the challenges of a highly competitive global marketplace.

To survive and prosper in such conditions, it is the quality of the products and efficiency of a business trying to sell those will count. Now with all such non-business-friendly bureaucratic hangovers from the past still functional, the question arises if the government is really serious about entering that aggressive phase of business post-graduation. In the circumstances, time in hand must be utilized most expeditiously to enact required reforms before the graduation train arrives.​