[🇧🇩] LDC Graduation For Bangladesh

[Saif]

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.​

 

[Saif]

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.​

 

[Saif]

Wahiduddin stresses FTAs for successful LDC graduation

Planning Adviser Dr Wahiduddin Mahmud has highlighted the need for free-trade agreements (FTAs) among the member- countries of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC). Addressing a programme marking BIMSTEC's 28th founding anniversary in the cap

thefinancialexpress.com.bd

BIMSTEC 28th founding anniversary
Wahiduddin stresses FTAs for successful LDC graduation

FE REPORT
Published :
Jun 18, 2025 08:28
Updated :
Jun 18, 2025 08:28

Planning Adviser Dr Wahiduddin Mahmud has highlighted the need for free-trade agreements (FTAs) among the member- countries of the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC).

Addressing a programme marking BIMSTEC's 28th founding anniversary in the capital on Monday evening, he pointed out that Bangladesh needs FTAs with BIMSTEC members as well as other countries for a smooth transition to the post-least- developed-country (LDC) graduation period.

He also stressed seamless multimodal connectivity among BIMSTEC members, saying it is a pre-condition for trade and investment promotion, people-to-people contacts, and energy cooperation, which are facilitators for economic development.

"Bangladesh remains strongly committed to advancing regional economic integration as a lead country in the trade, investment and development sector, including the blue economy," he added.

Reaffirming Bangladesh's commitment to regional cooperation, he expressed confidence in BIMSTEC's potential to become a dynamic and result-oriented organisation that delivers tangible benefits to its people.

BIMSTEC was established on June 6, 1997, through the signing of the Bangkok Declaration.

Fisheries and Livestock Adviser Farida Akhter, secretaries and officials of the government of Bangladesh, ambassadors and high commissioners, heads of international organisations, members of the diplomatic corps, media personnel, representatives of think tanks, and members of the BIMSTEC Secretariat attended Monday's event.

Welcoming the guests, BIMSTEC Secretary General Indra Mani Pandey noted that BIMSTEC, since its inception, has made significant progress in forging regional cooperation in various sectors.

It has succeeded in creating the institutional framework that it needs to function as an efficient and effective regional organisation, he said.

Besides, it has its own charter and well-established core and sectoral mechanisms, including senior officials meetings, ministerial meetings, and summits, he said.

Reflecting on BIMSTEC's 28-year journey, Mr Pandey highlighted the significant outcomes of the 6th BIMSTEC Summit held in Bangkok in April this year.

He said at the summit, BIMSTEC leaders, apart from their comprehensive summit declaration, adopted BIMSTEC Bangkok Vision 2030, providing a roadmap for building a prosperous, resilient, and open BIMSTEC.

They proposed a number of steps to enhance regional cooperation under BIMSTEC, he also said.

In addition to signing and adopting the Agreement on Maritime Transport Cooperation, memoranda of understanding between BIMSTEC and its developmental partners, the Indian Ocean Rim Association, and the United Nations Office on Drugs and Crime were also inked.

As part of the anniversary celebration, BIMSTEC member states showcased the cultural "unity in diversity" of the Bay of Bengal region by presenting their dance performances, exhibiting artefacts and other unique and symbolic items, and the march past, with the representatives proudly carrying their national flags in a symbolic display of unity and solidarity among member states.

Since September 2014, the BIMSTEC Secretariat located in Dhaka has been committed to supporting the member states to implement the decisions made by the leaders.

At Monday's programme, the organisation's secretary general conveyed that the BIMSTEC Secretariat was immensely grateful to the government of Bangladesh for hosting the Secretariat and providing it with all the necessary support.

He said the BIMSTEC Secretariat was also grateful to the embassies and high commissions of the BIMSTEC member states in Dhaka for their continued cooperation, including the organisation of the reception.

The celebration reaffirmed in a unique way BIMSTEC's growing importance as a regional platform for the realisation of the goals of peace, prosperity, and development in the Bay of Bengal region.

It also reflected the commitment of the member states to the organisation's success.

BIMSTEC comprises seven countries of the Bay of Bengal region - Bangladesh, Bhutan, India, Myanmar, Nepal, Sri Lanka, and Thailand.

It pursues regional cooperation in seven broad sectors - agriculture and food security; connectivity; environment and climate change; people-to-people contact; science, technology and innovation; security; and trade, investment and development.

The cooperation also covers eight sub-sectors - blue economy, mountain economy, energy, disaster management, fisheries and livestock, poverty alleviation, health, and human resource development.​

 

[Saif]

Bangladesh's LDC graduation: risks & readiness

Bangladesh is at a landmark in the nation’s life—one of jubilation and an invitation to strategic contemplation. Bangladesh. With its anticipated graduation from the United Nations’ List of Least Developed Countries (LDCs) by 2026, the nation is poised to turn a new page in its de

thefinancialexpress.com.bd

Bangladesh's LDC graduation: risks & readiness
Trade Dividends, Investment Climate, and Competitiveness

Serajul I Bhuiyan
Published :
Jul 08, 2025 22:28
Updated :
Jul 08, 2025 22:30

Bangladesh is at a landmark in the nation’s life—one of jubilation and an invitation to strategic contemplation. Bangladesh. With its anticipated graduation from the United Nations’ List of Least Developed Countries (LDCs) by 2026, the nation is poised to turn a new page in its development history. The graduation is a strong indication of Bangladesh’s progress in achieving phenomenal success in poverty reduction, improvements in health and education, increased per capita income, and macroeconomic stability.

But with this latter benchmark comes also a set of structural and economic problems. Graduation means the end of some of the world’s special treatment—above all, access to the world’s markets duty-free and concessionary lending and technical assistance—on which the country’s export-led success and infrastructure growth have relied all these years. For a nation that still lags in addressing chronic inequality, climate vulnerability, and productivity disparities, the post-graduation phase must be met with a different agenda and policymaking approach.

This article addresses the most relevant risks and drivers of readiness concerning LDC graduation, including the risk of trade concession losses, the shift in the investment climate, and the need to establish national competitiveness. Since Bangladesh stands at the threshold stage, the question is not whether it will happen but whether it can thrive after graduation. It is a time to reflect, look forward, and move forward with resolve to ensure this milestone is not a stumbling block but a stepping stone towards shared and sustainable prosperity.

The Loss of Preferential Market Access: The most direct and far-reaching consequence of Bangladesh’s graduation from LDC status is the phased withdrawal of preferential market access that is currently available under international trade regimes, such as the European Union’s Everything But Arms (EBA) policy. These trade patterns have played a crucial role in driving Bangladesh’s export-led growth, particularly in the ready-made garments (RMG) sector, which accounts for more than 80 per cent of the country’s total exports and employs over four million workers, the vast majority of whom are women.

Bangladesh will face higher tariffs—12 per cent in some of the most valuable markets—if other trade facilitations are not realised. This directly threatens Bangladeshi products in the global market. In line with this, the government has doubled efforts to achieve the Generalized Scheme of Preferences Plus (GSP+) with the European Union, demanding rigorous compliance with labor, environmental, and human rights conventions.

Meanwhile, Bangladesh is also diversifying its export basket, shifting its focus from textiles to sectors such as ICT, pharmaceuticals, leather, and jute goods. Trade diplomacy has also been undertaken to sign new bilateral and regional trade agreements in Asia, Africa, and Latin America. Value addition is also being enhanced as factory standards are raised to international levels and production facilities are modernised, enabling Bangladesh to remain a competitive partner in evolving global supply chains.

Investment Climate: Though an LDC, Bangladesh benefited from concessional credits, technical assistance, and differential treatment in accessing international aid-for-trade program benefits. With these privileges now poised to end, the spotlight falls on domestic readiness and institutional strengths in attracting high-quality investment.
The government of Dr. Muhammad Yunus has drawn up a vision-led forward roadmap to decouple aid dependence and trigger investment-driven growth. The highest priority is being accorded to the following:

Policy Predictability. A coherent, transparent regulatory framework for reducing risk perceptions of investors.

• Infrastructure Upgradation: Significant investments in ports, power, and transport corridors to reduce logistics costs and improve efficiency.

• Economic Zones and Industrial Parks: Bangladesh Economic Zones Authority (BEZA) is fast-tracking the establishment of industrial enclaves with plug-and-play infrastructure and fiscal incentives.

• Digital Governance: e-registration, e-taxation, and single-window services are some of the measures being introduced to simplify investor procedures and eliminate bureaucratic barriers.

• Legal and Judicial Reforms: Measures are being taken to reform the enforcement of contracts, land acquisition, and arbitration processes to instill confidence in investors.

• In addition to these, Bangladesh is also actively wooing diaspora investment under special bonds and incentive programs while encouraging local entrepreneurs to improve their access to finance, training, and markets. These across-the-board reforms reflect the country’s need to consolidate its fragile investment success into a strong and durable foundation.

Creating Competitiveness for a Post-LDC Economy: As Bangladesh advances towards graduation from the LDC existence, national competitiveness is no longer a requirement—it is a strategic necessity. Graduation will put the country on a level playing field with advanced developing economies; hence, it is imperative to transition from low-cost to high-value, innovation-driven industries.

The RMG sector, the cornerstone of Bangladesh’s export economy for decades, must undergo structural changes. This involves investing in automation and digitalisation to improve productivity, adopting sustainable and ethical business practices to meet evolving consumer and regulatory demands, and advancing up the value chain by building design capabilities, enhancing branding, and diversifying product lines.

Garment non-appearing industries are emerging as new sources of competitiveness:

• Pharmaceuticals: Through high API (Active Pharmaceutical Ingredient) strength and export to over 150 export markets, the sector can become a $5 billion industry by 2030.

• Information and Communication Technology (ICT): Digital Bangladesh and the nascent tech startup ecosystem are driving exports in software, BPO, and digital services.

• Agro-processing: As the world demands more safe, traceable food, Bangladesh’s robust agricultural base can be leveraged through modern processing, packaging, and export chains.

• Shipbuilding and Light Engineering: With its skilled labor force and competitive production costs, Bangladesh is making promising progress in these sectors as a niche manufacturing hub.

To consolidate and scale up these gains, human capital development is crucial. The interim government is further investing in Technical and Vocational Education and Training (TVET), as well as academia-industry partnerships and digital literacy programs. Bangladesh’s demographic dividend, comprising more than 60 per cent of the population aged under 35 years, can be reaped only if the youth are future-proofed with the necessary skills. Additionally, the formation of the Dhaka-Chattogram Economic Corridor and improvements in connectivity with regional transportation networks are enhancing the efficiency of trade logistics. Customs modernisation, electronic certificates of origin, and integration into global value chains are also becoming a priority to reduce the time and cost of doing business. Bangladesh’s ability to transform its enormous potential into long-term competitiveness will shape its post-LDC success story. Innovation, diversification, and wise investment in systems and individuals will be the cornerstones of this advancement.

Strategic Readiness to Face a Post-LDC World: The interim government has proposed a national roadmap for readiness that outlines the key vulnerabilities and opportunities associated with graduation from LDC status. These are:

• Institution Building: Establishing a robust institutional setup of trade policy, intellectual property rights, and alternative dispute resolution mechanisms.

• Human Capacity Development: Initiating national vocational and technical education programs to bridge the skills gap and meet global labor market needs.

• Innovation Ecosystem: Promoting research and innovation by industry-university partnerships and startup incubation centers.

• Green Industrial Policy: Enabling sustainable industrialization by green finance, eco-labelling, and low-carbon production methods.

• Social Protection: Enhancing the social protection system to include the poor and vulnerable in the economic transformation process.

The interim government is also leveraging international goodwill to secure strategic partnerships with countries and multilateral organisations for dignified and graceful graduation.

Conclusion: Graduation from LDC status is not a ceremonial upgrade; it is a landmark in the growth history of Bangladesh. It sires global respect but also demands institutional strength, fiscal resilience, and vision-oriented governance. The path ahead will require astute policymaking, economic inclusiveness, and collaboration in the public, private, and international sectors. Together, with determination, Bangladesh can turn this transition into an opportunity—not only to consolidate its previous achievements but also to leap ahead as a proud, self-sustaining, and competitive middle-income country. As Bangladesh steps into the global scene with a fresh image, let it not forget: the fight is far from won, but the promise of a better, more honourable tomorrow has never appeared so within reach.

Dr Serajul I Bhuiyan is a professor and former Chair of the Department of Journalism and Mass Communications at Savannah State University, Savannah, Georgia, USA.​