The least developed countries (LDCs) are developing countries listed by the United Nations that exhibit the lowest indicators of socioeconomic development. The concept of LDCs originated in the late 1960s and the first group of LDCs was listed by the UN in its resolution 2768 (XXVI) on 18 November 1971. [1]
A country is classified among the Least Developed Countries if it meets three criteria: [2] [3]
As of December 2023, 45 countries were still classified as LDC, while seven graduated between 1994 and 2023. [4] The World Trade Organization (WTO) recognizes the UN list and says that "Measures taken in the framework of the WTO can help LDCs increase their exports to other WTO members and attract investment. In many developing countries, pro-market reforms have encouraged faster growth, diversification of exports, and more effective participation in the multilateral trading system." [5]
LDC criteria are reviewed every three years by the Committee for Development Policy (CDP) of the UN Economic and Social Council (ECOSOC). Countries may be removed from the LDC classification when indicators exceed these criteria in two consecutive triennial reviews. [6] The United Nations Office of the High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States (UN-OHRLLS) coordinates UN support and provides advocacy services for Least Developed Countries. The classification (as of December 2020 [update] ) applies to 46 countries. [4]
At the UN's fourth conference on LDCs, which was held in May 2011, delegates endorsed a goal targeting the promotion of at least half the current LDC countries within the next ten years. [7] As of 2018, ten or more countries were expected to graduate in 2024, with Bangladesh and Djibouti already satisfying all criteria in 2018. [8]
There is one country which presently meets the criteria and two countries which previously met the criteria for LDC status, but declined to be included in the index, questioning the validity or accuracy of the CDP's data: Ghana (no longer meets criteria as of 1994), Papua New Guinea (no longer meets criteria as of 2009), and Zimbabwe. [9]
Least developed countries can be distinguished from developing countries, "less developed countries", "lesser developed countries", or other similar terms.
The term "less economically developed country" (LEDC) is also used today. However, in order to avoid confusion between "least developed country" and "less economically developed country" (which may both be abbreviated as LDC), and to avoid confusion with landlocked developing country (which can be abbreviated as LLDC), "developing country" is generally used in preference to "less-developed country".
During a United Nations review in 2018, the UN defined LDCs as countries meeting three criteria, one of which was a three-year average estimate of gross national income (GNI) per capita of less than US$1,025. [10]
There were five United Nations conferences on LDCs, held every ten years. The first two were in Paris, in 1981 and 1991; the third was in Brussels in 2001.
The Fourth UN Conference on Least Developed Countries (LDC-IV) was held in Istanbul, Turkey, on 9–13 May 2011. It was attended by Ban Ki-moon, the head of the UN, and close to 50 prime ministers and heads of state. The conference endorsed the goal of raising half the existing Least developed countries out of the LDC category in 2022. As with the Seoul Development Consensus drawn up in 2010, there was a strong emphasis on boosting productive capability and physical infrastructure, with several NGOs not pleased with the emphasis placed on the private sector. [7] [11]
Issues surrounding global trade regulations and LDCs have gained a lot of media and policy attention thanks to the recently collapsed Doha Round of World Trade Organization (WTO) negotiations being termed a development round. During the WTO's Hong Kong Ministerial, it was agreed that LDCs could see 100 percent duty-free, quota-free access to U.S. markets if the round were completed. But analysis of the deal by NGOs found that the text of the proposed LDC deal had substantial loopholes that might make the offer less than the full 100 percent access, and could even erase some current duty-free access of LDCs to rich country markets. [12] [13] Dissatisfaction with these loopholes led some economists to call for a reworking of the Hong Kong deal.[ citation needed ]
Chiedu Osakwe, as of 2001 the Director, Technical Cooperation Division at the Secretariat of the WTO, and adviser to the Director-General on developing country matters, was appointed as the WTO Special Coordinator for the Least Developed Countries beginning in 1999. [14] He worked closely with the five other agencies that together with the WTO constitute the Integrated Framework of action for the Least Developed Countries. They addressed issues of market access, special and differential treatment provisions for developing countries, participation of developing countries in the multilateral trading system, and development questions, especially the interests of developing countries in competition policy. [15] At the 28th G8 summit in Kananaskis, Alberta, Canadian Prime Minister Jean Chrétien proposed and carried the Market Access Initiative, so that the then 48 LDCs could profit from "trade-not-aid". [16] Additionally, the United Nations Sustainable Development Goal 14 advocates for an effective special and differential treatment of LDCs as integral parts of WTO fisheries subsidies negotiation. [17]
The following 45 countries were still listed as least developed countries by the UN as of December 2023: [18] Afghanistan, Angola, Bangladesh, Benin, Burkina Faso, Burundi, Cambodia, Central African Republic, Chad, Comoros, Democratic Republic of the Congo, Djibouti, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Haiti, Kiribati, Laos, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Myanmar, Nepal, Niger, Rwanda, São Tomé and Príncipe, Senegal, Sierra Leone, Solomon Islands, Somalia, South Sudan, Sudan, Timor-Leste, Togo, Tuvalu, Uganda, Tanzania, Yemen, and Zambia.
There are 33 countries that are classified as least developed countries in Africa, eight in Asia, three in Oceania, and one in the Americas.
The list of "least developed countries" according to the United Nations with some that are categorized into the landlocked developing countries and the Small Island Developing States: [19]
Africa
Americas
Asia
Oceania
The three criteria (human assets, economic vulnerability and gross national income per capita) are assessed by the Committee for Development Policy every three years. Countries must meet two of the three criteria at two consecutive triennial reviews to be considered for graduation. The Committee for Development Policy sends its recommendations for endorsement to the Economic and Social Council (ECOSOC). [23]
After the initiation of the LDC category, seven countries graduated to developing country status. The first country to graduate from LDC status was Botswana in 1994. The second country was Cape Verde in 2007. [24] Maldives graduated to developing country status at the beginning of 2011, Samoa in 2014, [6] [25] Equatorial Guinea in 2017, [26] Vanuatu in December 2020, [27] and Bhutan in December 2023. [28]
The following countries are no longer categorized in the "least developed countries" group:
The economy of Bhutan is based on agriculture and forestry, which provide the main livelihood for more than 60% of the population. Agriculture consists largely of subsistence farming and animal husbandry. Rugged mountains dominate the terrain and make the building of roads and other infrastructure difficult. Bhutan is among the richest by gross domestic product (nominal) per capita in South Asia, at $3,491 as of 2022, but it still places 153rd, and among the poorest in the world. The total gross domestic product is only $2,653 million, and 178th according to IMF.
Though the Ministry of Foreign Affairs (MOFA) is the government agency which is responsible for conducting the foreign relations of Nepal, historically, it is the Office of the Prime Minister (PMO) which has exercised the authority to formulate the country's foreign policies. As a landlocked country wedged between two larger and far stronger powers, Nepal has tried to maintain good relations with both of its neighbors, People's Republic of China and Republic of India. However, the relationship between Nepal and India was significantly hampered by the 2015 Nepal blockade when the Government of Nepal accused India of mimicking "Russia-Ukraine" tactics by using ethnically Indian residents of Nepal to cause unrest along Nepal's southern border. India denied the allegation and said the unrest were an internal affair. For the most part though, Nepal has traditionally maintained a non-aligned policy and enjoys friendly relations with its neighboring countries and almost all the major countries of the world.
UN Trade and Development (UNCTAD) is an intergovernmental organization within the United Nations Secretariat that promotes the interests of developing countries in world trade. It was established in 1964 by the United Nations General Assembly (UNGA) as the United Nations Conference on Trade and Development but rebranded to its current name on the occasion of its 60th anniversary in 2024. It reports to both the General Assembly and the United Nations Economic and Social Council (ECOSOC). UNCTAD is composed of 195 member states and works with non-governmental organizations worldwide; its permanent secretariat is at UNOG in Geneva, Switzerland.
A developing country is a sovereign state with a less developed industrial base and a lower Human Development Index (HDI) relative to other countries. However, this definition is not universally agreed upon. There is also no clear agreement on which countries fit this category. The terms low and middle-income country (LMIC) and newly emerging economy (NEE) are often used interchangeably but refers only to the economy of the countries. The World Bank classifies the world's economies into four groups, based on gross national income per capita: high, upper-middle, lower-middle, and low income countries. Least developed countries, landlocked developing countries and small island developing states are all sub-groupings of developing countries. Countries on the other end of the spectrum are usually referred to as high-income countries or developed countries.
From 1916 to 1975, Tuvalu was part of the Gilbert and Ellice Islands colony of the United Kingdom. A referendum was held in 1974 to determine whether the Gilbert Islands and Ellice Islands should each have their own administration. As a consequence of the referendum, the separate British colonies of Kiribati and Tuvalu were formed. Tuvalu became fully independent as a sovereign state within the Commonwealth on 1 October 1978. On 5 September 2000, Tuvalu became the 189th member of the United Nations.
The South Asian Free Trade Area (SAFTA) is a 2004 agreement that created a free-trade area of 1.6 billion people in Afghanistan, Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan and Sri Lanka with the vision of increasing economic cooperation and integration.
Everything but Arms (EBA) is an initiative of the European Union under which all imports to the EU from the least developed countries are duty-free and quota-free, with the exception of armaments. EBA entered into force on 5 March 2001. There were transitional arrangements for bananas, sugar and rice until January 2006, July 2009 and September 2009 respectively. The EBA is part of the EU Generalized System of Preferences (GSP). The up-to-date list of all countries benefiting from such preferential treatment is given in Annex IV of the consolidated text of Regulation (EU) 978/2012.
The landlocked developing countries (LLDC) are developing countries that are landlocked. Due to the economic and other disadvantages suffered by such countries, the majority of landlocked countries are least developed countries (LDCs), with inhabitants of these countries occupying the bottom billion tier of the world's population in terms of poverty. Outside of Europe, there is not a single highly developed landlocked country as measured by the Human Development Index (HDI), and nine of the twelve countries with the lowest HDI scores are landlocked. Landlocked European countries are exceptions in terms of development outcomes due to their close integration with the regional European market. Landlocked countries that rely on transoceanic trade usually suffer a cost of trade that is double that of their maritime neighbours. Landlocked countries experience economic growth 6% less than non-landlocked countries, holding other variables constant.
Economic Partnership Agreements (EPAs) are a scheme to create a free trade area (FTA) between the European Union and other countries. They are a response to continuing criticism that the non-reciprocal and discriminating preferential trade agreements offered by the EU are incompatible with WTO rules. The EPAs date back to the signing of the Cotonou Agreement. The EPAs with the different regions are at different states of play. The EU has signed EPAs with the following countries: the Southern African Development Community (SADC), ECOWAS, six countries in Eastern and Southern Africa, Cameroon, four Pacific states, and the CARIFORUM states. Their defining characteristic is that they open up exports to the EU immediately, while exports to the partner regions is opened up only partially and over transitioning periods.
The G90, otherwise known as the Group of 90, is an alliance between the poorest and smallest developing countries, many of whom are part of the World Trade Organization (WTO). The G90 emerged as a strong grouping at the WTO’s Ministerial conference at Cancun in September 2003, taking common positions representing the largest number of countries, with 64 of the 90 countries in the G90 being members of the WTO. It is the largest trading body in the WTO, and it was formed as an umbrella body including the African, Caribbean and Pacific Group (ACP), the African Union, and the group of Least Developed Countries (LDC).
The Economic vulnerability index is one of the criteria used by the United Nations Committee for Development Policy, an advisory body to the United Nations Economic and Social Council, in the identification of Least Developed Countries. It is a composite of eight indicators:
The economy of Cape Verde is a service-oriented economy that is focused on commerce, trade, transport and public services. Cape Verde is a small archipelagic nation that lacks resources and has experienced severe droughts. Agriculture is made difficult by lack of rain and is restricted to only four islands for most of the year. Cape Verde's economy has been steadily growing since the late 1990s, and it is now officially considered a country of average development, being only the second African country to have achieved such transition, after Botswana in 1994. Cape Verde has significant cooperation with Portugal at every level of the economy, which has led it to link its currency first to the Portuguese escudo and, in 1999, to the euro.
Tuvalu became the 189th member of the United Nations in September 2000. Tuvalu is one of 14 states not recognising the People's Republic of China. The country has played a role in advocating for more ambitious international cooperation on mitigating climate change, given the country's vulnerability to its impacts.
The Enhanced Integrated Framework for Trade-Related Assistance for the Least Developed Countries is a global development program with the objective of supporting least developed countries (LDCs) to better integrate into the global trading system and to make trade a driver for development. The multi-donor program was launched on 1 January 2007 as the successor of the Integrated Framework for Trade-Related Technical Assistance to the Least-Developed Countries, which existed from October 1997 to December 2006. The second phase of the EIF has started on 1 January 2016 and will last for 7 years.
The United Nations Office of the High Representative for the Least Developed Countries, Landlocked Developing Countries and Small Island Developing States (UN-OHRLLS) is an office of the United Nations Secretariat which deals with the Least Developed Countries, Landlocked Developing Countries, and Small Island Developing States. It was founded in 2001 by United Nations resolution 56/227.
The Sopoaga Ministry was the 14th ministry of the Government of Tuvalu, led by Prime Minister Enele Sopoaga. It succeeds the Telavi Ministry upon its swearing in by Governor-General Sir Iakoba Italeli on 5 August 2013.
Fahmida Khatun is a Bangladeshi economist who focuses on policy analysis and project management.
Dorothy (Ng’ambi) Tembo is a Zambian economist and trade and development expert. She is the deputy executive director of the International Trade Centre (ITC), a joint agency of the United Nations and the World Trade Organization.
Aid for Trade is an initiative by the World Trade Organization (WTO), as well as a policy concept in international economic and trade development, concerned with helping developing countries and particularly the least developed countries build trade capacity and infrastructure.
Duty Free Tariff Preference (DFTP) is a unilateral non-reciprocal preferential tariff scheme provided by the Government of India for the least developed countries (LDCs). The scheme was officially introduced on 13 August 2008. India was the first developing country to introduce a preferential tariff program for the LDCs.
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