Bangladesh to face new economic reality after LDC graduation: Commerce minister
He says Bangladesh’s logistics cost-to-GDP ratio currently stands at around 16%
Commerce Minister Khandaker Abdul Muktadir has said Bangladesh will face an entirely new economic reality after graduating from the Least Developed Country (LDC) category, warning that the country will lose access to low-interest loans and several trade preferences tied to its LDC status.
"After LDC graduation, Bangladesh will have to adapt to a completely new economic environment. We will lose concessional financing and many LDC-specific trade benefits. So, we must make our economy more competitive and investment-friendly from now on," he said.
The minister made the remarks today (6 May) while speaking at a seminar titled 'Accelerating circular economy transformation in Bangladesh through SWITCH2CE pilot initiative', jointly organised by the Ministry of Commerce and the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) at a hotel in Dhaka.
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Highlighting structural challenges, Muktadir noted that Bangladesh's logistics cost-to-GDP ratio currently stands at around 16%, significantly higher than the global average of about 10%. He said the government has taken steps to reduce these costs, including improving efficiency at Chattogram Port.
"A terminal at the port has already been handed over to a Danish company for operation, and there are plans to involve more internationally competent firms in the future," he added.
On improving the investment climate, the minister said entrepreneurs currently face complex and time-consuming processes to obtain approvals and licences from multiple agencies.
To address this, the government plans to introduce a system allowing businesses to begin operations immediately after registration with a provisional approval, he added.
"They will then have up to 12 months to obtain all necessary permanent licences and clearances," he said, adding that efforts are underway to make the one-stop service system truly functional so that investors no longer need to move between different offices.
Referring to the SWITCH to Circular Economy programme, Muktadir said pilot initiatives under the programme have already demonstrated that transitioning to a circular economy is both realistic and achievable.
He added that pilot projects supported by H&M Group and Bestseller have generated practical experience in textile waste management, recycling systems, and value chain coordination in Bangladesh's textile and garment sector.
These experiences will serve as a strong foundation for a broader, structured transition toward a circular industrial model, he further said.
