Chambers warn of risks in rapid LDC transition

August 25, 2025

Staff Reporter :

Sixteen of Bangladesh’s leading business chambers and associations have renewed their appeal for the country to delay its graduation from the United Nations’ Least Developed Countries (LDC) category, warning that the economy remains ill-prepared for the transition set for November 2026.

At a joint press conference at the InterContinental Dhaka, Mahbubur Rahman, president of the International Chamber of Commerce-Bangladesh (ICC-B), speaking on behalf of the collective, called on the government to seek a three- to five-year extension.

Rahman cautioned that key sectors, particularly garments and pharmaceuticals, would face severe headwinds once Bangladesh loses duty- and quota-free market access, jeopardising export competitiveness
in crucial global markets.

He cited international precedents, noting that the Maldives deferred graduation by eight years, Botswana by two decades, while Bhutan and Vanuatu also secured extensions. “Bangladesh can draw lessons from these cases to ensure a smoother and more sustainable graduation,” Rahman said.

Business leaders stressed that additional time was essential to finalise free trade agreements (FTAs) and preferential trade deals with partners including the European Union, the United Kingdom, ASEAN, and Gulf countries, especially to mitigate tariff shocks from the US market. They also underscored the urgency of diversifying exports into pharmaceuticals, ICT, leather, agro-processing and light engineering.

Rahman highlighted compounding pressures-ranging from debt stress, financial instability, low foreign direct investment and currency weakness to energy shortages, logistics bottlenecks, climate vulnerabilities and the economic fallout from the July 2024 unrest.

“Graduation is inevitable, but success is not guaranteed,” he remarked. “The entire private sector supports deferring the timeline, ideally until 2032. The government must vigorously pursue this at international forums to safeguard the economy and secure a smoother transition.”