LDC graduation not yet within reach amid economic pressures: Finance minister

Bangladesh's graduation from the Least Developed Country (LDC) category is not yet within reach in the current situation, Finance and Planning Minister Amir Khosru Mahmud Chowdhury said today (5 April), citing mounting economic pressures and incomplete preparations.

Challenges such as rising foreign debt, internal liabilities, high borrowing costs and weaknesses in financial management remain significant obstacles, the minister noted while speaking to reporters after a national multi-stakeholder consultation meeting at the NEC Conference Room in Sher-e-Bangla Nagar.

"The ongoing fuel crisis and disruptions in global supply chains could have long-term effects on Bangladesh's economy, extending beyond the energy sector to food and other markets, and adding to inflationary pressures," he said.

The minister noted that fuel prices have increased in many countries, saying they have doubled in the United States and risen sharply in Sri Lanka.

"Bangladesh is still attempting to keep prices relatively stable, but it would not be possible for the government to bear such pressure for long," Khosru added.

He said the government is trying to avoid imposing sudden additional pressure on people.

However, if financial strain continues, the burden will ultimately fall on the public.

In this context, he said economic decisions must be taken cautiously to balance public interest with long-term economic stability.

The meeting was held to present findings from an Independent Graduation Readiness Assessment conducted by the United Nations Office of the High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States (UN-OHRLLS).

The assessment was carried out at the request of the Bangladesh government to review preparations for transitioning from Least Developed Country status.

The minister said the country is currently facing a complex economic situation, with the government addressing challenges on a day-to-day basis.

"Efforts are being made to salvage the economy. Additionally, continuous bleeding of government funds is making the situation more complex. Subsidies in the energy sector, price hikes in the global market, and import dependence – all combined – are increasing the pressure on the economy," Khosru added.

He said capacity building would be key to overcoming the current challenges.

In this regard, he referred to alignment with policy directions outlined in the BNP's manifesto, adding that effective implementation could help strengthen the economic foundation.

He also said there is an opportunity to seek a deferral or extension of LDC graduation, during which the government plans to improve key economic indicators over an estimated three-year period.

If reforms, skills development and stability can be achieved, graduation would become more feasible.

The consultation was organised by the Economic Relations Division (ERD) with support from UN-OHRLLS and the Office of the UN Resident Coordinator in Bangladesh.

Foreign Minister Khalilur Rahman, Commerce Minister Khandaker Abdul Muktadir, Prime Minister's Adviser on Finance and Planning Rashed Al Mahmud Titumir, UN-OHRLLS Under-Secretary-General Rabab Fatima, and State Minister for Planning Zonayed Saki were also present.