he private sector has urged the government to defer the LDC graduation for at least two to three years.
They made the request at a Focus Group Discussion on “Implementation of the STS for Smooth Transition from LDC Status,” jointly organized by the Support to Sustainable Graduation Project (SSGP), Economic Relations Division (ERD), and DCCI on 10 March 2025 at the DCCI Auditorium.
Taskeen Ahmed, President of the Dhaka Chamber of Commerce & Industry (DCCI), requested the government to defer Bangladesh’s LDC graduation by at least 2 to 3 years, citing the prevailing global and local economic challenges, acute energy shortages in the industrial sector, high inflation, high duties on imports, high interest rates, procedural complexities in obtaining bank credit, and the lack of access to credit for the private sector.
ERD Secretary Md. Shahriar Kader Siddiky and Commerce Secretary Mahbubur Rahman attended as Chief Guest and Special Guest, respectively.
From the private sector perspective, DCCI President Taskeen Ahmed presented a keynote paper. He also noted that the GDP growth in the first quarter of the current fiscal year was only 1.8 percent, while the manufacturing sector grew by just 1.43 percent.
He highlighted that Bangladesh’s economy is still grappling with various challenges. Amid these struggles, the country is set to graduate from LDC status in 2026. A “Smooth Transition Strategy (STS)” has already been formulated by the government to guide the preparation process.
However, he pointed out key elements essential for implementing the STS, including: an implementation framework, strong leadership and commitment, partnership and solidarity, policy integration, financing the strategy, and monitoring and evaluation.
For an effective and competitive STS, he recommended developing a roadmap to stabilize the economy, creating a real-time monitoring and evaluation platform, signing economic partnership agreements/FTAs with key partners, and aligning trade, industrial, and investment policies.
He also stressed the need for skill development in the SME sector and long-term access to low-cost credit, the signing of free trade agreements to expand exports to the Middle East and South Asian countries, infrastructure development to attract FDI, and revisions to revenue and related policies.
Additionally, he called for formulating and implementing specific policies to increase exports in sectors beyond the ready-made garment industry, such as pharmaceuticals, leather and leather products, agro-processing, semiconductors, light engineering, and information technology. He emphasized that the private sector’s role is crucial for a comprehensive and implementable STS.
Speaking as the chief guest, ERD Secretary Md. Shahriar Kader Siddiky stated that capacity building at all levels is necessary to address the impact of losing trade benefits in the post-LDC era. He mentioned that a committee will be formed with representatives from trade organizations to identify the private sector’s needs and find solutions. He agreed that challenges remain, but noted that the country’s current account and financial account positions have significantly improved.
To address the statistics/data gap, he revealed that UNSCAP and the European Union would assist the government in implementing best practices suited to Bangladesh’s context. He also informed the audience that South Korea had agreed to help Bangladesh implement digitalization across government services.
Commerce Secretary Mahbubur Rahman, speaking as the special guest, pointed out that the lack of proper planning and implementation from the beginning had hindered the process of preparing for LDC graduation. However, he stressed that more attention should be paid to ensuring a sustainable LDC graduation process based on the private sector’s input. He urged the private sector to focus on product diversification in the RMG sector, particularly in the promising packaging area.
In his welcome speech, A. H. M. Jahangir, Additional Secretary & Project Director of the Support to Sustainable Graduation Project (SSGP), Economic Relations Division, emphasized that the private sector would face the most significant challenges from LDC graduation. In this context, he stressed the importance of coordinated efforts among stakeholders in implementing the STS to address the overall challenges of the LDC transition.
Dr. Mostafa Abid Khan, Component Manager (and former Member of the Bangladesh Trade and Tariff Commission), SSGP, ERD, noted that about 73% of Bangladesh’s total exports currently enjoy duty-free benefits, which will be lost post-graduation. He also highlighted the lack of export product diversification as a major challenge that needs immediate attention. Additionally, he stressed the importance of expanding both local and foreign investments, enhancing human resource skills, building institutional capacity, and improving public-private sector coordination.
Dr. Md. Rezaul Bashar Siddique, Component Manager (and former Additional Secretary), SSGP, ERD, mentioned that microeconomic stability could be achieved through the implementation of the STS. He pointed out that Bangladesh is still performing well in all indices required for LDC graduation, but emphasized the need for an integrated ‘Action Matrix.’
Rizwan Rahman, former President of DCCI, suggested that the separation of the “Medium” category from the CMSME would allow cottage and small entrepreneurs to fully benefit from the government’s policy support. He also urged that the government consult the private sector to determine whether a temporary deferral of the LDC graduation is feasible.
Manwar Hossain, Chairman of Anwar Group of Industries, expressed concerns about the lag in infrastructure development and the impact of gas shortages on the steel and cement industries, which, in turn, are affecting the overall economy. Regarding LDC graduation, he argued that the country is not truly ready for graduation until exports exceed imports.
BKMEA President Mohammad Hatem remarked that since 2022, the economy has been witnessing a downward trend in various indicators, including export data mismatches. He pointed to several government and Bangladesh Bank policies that were not conducive to the export sector, such as the closure of the EDF fund and high interest rates. He emphasized that, in light of the current situation, the private sector needs more time to prepare for graduation.
Asif Ashraf, former Director of BGMEA, stated that, at this moment, Bangladesh is not ready for LDC graduation and emphasized the need for the industry to focus on backward integration to benefit from the GSP Plus advantage.
Md. Mahbubur Rahman Patwary, Managing Director of Sonali Ash Industries Limited, highlighted that the government’s technical and financial support is crucial for the diversification of the jute sector.
DCCI Senior Vice President Razeev H Chowdhury, Vice President Md. Salem Sulaiman, and members of the Board of Directors, along with representatives from both the public and private sectors, attended the event.
