International opportunities that Bangladesh is currently enjoying as a least developed country will either be unavailable or be reduced after the transition from a least developed country
Finance Minister AHM Mustafa Kamal on Thursday said Bangladesh's image in the outside world will brighten after the graduation to a developing economy, which will bring foreign investment and create jobs.
“Foreign investment will likely increase, which will lead to massive infrastructure development in the country, job creation, and improved living standards,” he said.
In his budget speech at the parliament, the finance minister said the graduation will increase the country's credit rating, which will enable Bangladesh to get low interest loans in foreign currency by issuing sovereign bonds.
He, however, said all the international opportunities that Bangladesh is currently enjoying as a least developed country will either be unavailable or be reduced in many cases after the transition from a least developed country.
These include: In the case of trade, duty-free and quota-free market facilities; exemption from patent protection to the pharmaceutical industry under the WTO's Trade Related Intellectual Property (TRIPS) Agreement; and subsidies on export products/industries will be reduced.
Foreign loans and grants on concessionary terms will be reduced.
He said the graduation will also increase productivity and competitiveness in foreign trade, which will help increase export earnings.
The minister said absence of benefits as a least developed country will create a kind of compulsion to export diversification, resulting in the creation of new export products and markets.
He said the product supply chain will be integrated and will create incentives and obligations to produce high value and high value added products.
The minister said the massive increase in the demand for skilled manpower will create an opportunity to create a workforce suitable for the fourth industrial revolution.
“It will be easy to move the country forward by implementing a unified and inclusive development strategy with all stakeholders, including development and trade partners, the private sector and civil society,” he said.
The finance minister said the government has taken various steps to address the challenges that Bangladesh will face as a result of its graduation from an LDC.
At the request of the government, the UNCDP has recommended that against the backdrop of Covid-19 pandemic, the preparation period for the transition will be five years instead of three.
During this period, that is, until 2026, all international facilities will continue.
The LDC Group of the World Trade Organization (WTO) has put forward a proposal to ensure that all trade facilities pertaining to LDCs remain in force for another 12 years after transition.
Bangladesh has actively participated in this process, and is continuing its efforts to get this proposal accepted, said the Finance Minister.
He said the government has already taken steps to avail the advantage of GSP+ in EU countries after the graduation.
Initiatives have already been taken to sign preferential trade agreements with Bhutan and sign similar agreements with 11 other countries, the minister said.
The government has already taken steps to set up 100 special economic zones, high-tech parks for technological advancement and implementation of various mega projects including the Padma Bridge, which will help create new jobs and increase national income, he said.