Shahin Howlader
Bangladesh is standing at a turning point. In just a year’s time, the country is set to leave behind its “Least Developed Country” (LDC) status — a label it has carried for more than 50 years. For many, this is a proud moment, proof of how far Bangladesh has come through hard work, remittance, and the power of its garment workers.
But for exporters — the lifeblood of the economy — the excitement is mixed with worry. Graduation means global recognition, yes, but it also means losing the trade privileges that helped Bangladesh’s rise. Can the nation’s industries stand strong once those supports are gone? Or should Bangladesh ask for more time before taking the final leap?
The graduation deadline has already been deferred once, moving from 2024 to 2026, with the aim of giving Bangladesh breathing space to cushion its industries. The possibility of seeking another deferment remains, but such a move has both benefits and drawbacks. On the one hand, a further delay could extend preferential trade benefits, especially duty-free and quota-free access to major export markets such as the European Union, Canada, and Australia. This would buy exporters critical time to diversify markets, upgrade product sophistication, and prepare for the stricter post-graduation trade environment.
For a country where readymade garments (RMG) alone account for over 80% of export earnings, the breathing room could provide a buffer against sudden cost escalations and price competition. However, seeking another deferment also carries reputational risks. It could signal to global investors and development partners that Bangladesh lacks the readiness or confidence to move forward, potentially affecting foreign direct investment (FDI) inflows.
Moreover, remaining an LDC longer could prevent Bangladesh from fully tapping into the opportunities of middle-income status—such as attracting higher-value investments and gaining better credit ratings for international borrowing.The choice between deferment and graduation is, therefore, a balancing act between safeguarding short-term export competitiveness and committing to long-term economic maturity.
For details, click on