Govt Committed to Ensuring Smooth LDC Graduation: Adviser

Commerce Adviser Sk. Bashir Uddin

In an interview with the national news agency at his Secretariat office, Bashir Uddin emphasized the government’s commitment to the process. "Rest assured, we are doing everything possible, motivated by a sense of patriotism, to ensure a smooth transition," he said.

The adviser addressed concerns raised by the private sector regarding the LDC graduation, questioning why such concerns were not raised earlier. "For years, the private sector seemed indifferent to the issue. Now they are raising concerns, but why was there no strong voice before?" he asked.

Originally scheduled for 2024, Bangladesh's graduation was postponed due to factors like the COVID-19 pandemic. Bashir Uddin acknowledged the complex nature of the situation, saying, "I can't fully agree or disagree with the private sector's demands. It’s a paradox. If we agree with them, the necessary reforms could fall back into inaction."

He further stated that the decision to defer graduation does not lie within the government's control, urging the private sector to accept the inevitable. "Deferring graduation is not a decision for the government alone. The private sector must accept this reality."

Bashir Uddin confirmed that Bangladesh has met all three criteria for LDC graduation, though he noted debates over whether the data supporting the criteria is accurate. He also emphasized the government's ongoing efforts to manage the aftermath of previous government actions. "My team is working with sincerity and patriotism, and Insha Allah, we will navigate the country toward a better future," he added.

While some economists and business leaders advocate for delaying the graduation to allow more time for recovery from the pandemic, the Russia-Ukraine conflict, and global inflation, the government has decided to stay on schedule. Shafiqul Alam, the Chief Adviser’s press secretary, confirmed that expert opinions were considered before finalizing the decision. "The government has decided to proceed with the graduation process, considering the potential impact on industries," he said.

Alam also noted that Bangladesh will continue to enjoy LDC benefits for three years post-graduation, as per UN guidelines. Despite potential losses in trade worth over US$8 billion annually due to the withdrawal of preferential trade benefits, the country will benefit from a grace period of three years, with the European Union, UK, Canada, and Australia offering continued support, albeit with some conditions.

Bangladesh's economic progress since gaining independence in 1971 has enabled it to meet the graduation criteria. The country, which was listed as an LDC in 1975 to access vital benefits like zero-tariff and quota-free trade, has grown into the second-largest garment exporter in the world, after China. However, with the loss of these preferential benefits post-graduation, Bangladesh will face higher trade tariffs, which will impact 78% of its current exports.