BD must use 3-yr LDC extension for real reforms: CPD

Bangladesh must use the three-year extension before its graduation from the least developed country (LDC) category to carry out major economic reforms, rather than treat the additional time as an opportunity to delay difficult decisions, economists said on Sunday.

The warning came at a media dialogue titled Bangladesh's LDC Graduation: The UNGA Decision and Our Observations, organised by the Centre for Policy Dialogue (CPD) at its office in Dhaka.

CPD Distinguished Fellow Dr Debapriya Bhattacharya said Bangladesh would have to address three major challenges simultaneously over the next three years: preparing for LDC graduation, maintaining macroeconomic stability and restoring investment, employment and economic growth.

He stressed that controlling inflation, stabilising the exchange rate, reducing interest rates, increasing revenue collection and reforming the banking sector would be critical to achieving these goals.

"An exceptional decision demands exceptional performance," he said, warning that Bangladesh could not afford to waste the additional time granted by the United Nations.

Debapriya called for moving responsibility for coordinating LDC graduation preparations from the Economic Relations Division (ERD) to the Prime Minister's Office to ensure stronger political leadership and coordination among ministries.

He also proposed placing the reform agenda before parliament, forming an all-party parliamentary caucus and publishing a public dashboard showing progress against specific targets.

The urgency is clear from the country's economic weaknesses. Tax revenue stood at just 6.9 per cent of GDP in FY2025-26, while non-performing loans accounted for 32.8 per cent of total outstanding loans in June 2026, according to CPD's presentation.

The think tank also stressed the need to diversify exports beyond ready-made garments, improve energy security, strengthen social protection and modernise logistics.

It called for identifying and gradually phasing out LDC-specific facilities, including export cash incentives, before November 2029.

CPD Executive Director Dr Nazneen Ahmed chaired the dialogue. Distinguished Fellow Professor Mustafizur Rahman and Additional Director Towfiqul Islam Khan also attended.

Bangladesh is scheduled to graduate from the LDC category on November 24, 2029, following the exceptional three-year preparatory extension granted by the United Nations.