Lao PDR is recommended to graduate in 2026 from the Least Developed Country Category with an extended preparatory period.
The United Nations Committee for Development Policy (CDP) announced on 26th February that having conducted the triennial review of all Least Developed Countries (LDCs), Lao PDR has been recommended for graduation with an extended 5-year preparatory period effectively setting the graduation to 2026 assuming a positive and continued trajection throughout the time period leading up to graduation.
H.E. Mr. Saleumxay Kommasith, Minister of Foreign Affairs of the Lao PDR, expressed “Graduation from LDC status with quality has been a long-term objective of the Government of Lao PDR since 2000. Throughout the years, the Government has emphasized its strong commitment and consistently made significant progress in implementing National Socio-economic Development Plans (NSEDP). However, graduation is not an end in itself and does not imply that no poverty remains. It, somehow, indicates the hard-earned achievements by the Government in many priority areas. Therefore, the result of the review by the CDP paves the way forward for a smooth preparatory period before Lao PDR will be officially removed from the list of LDCs”. He also added that “Taking into account the current circumstances of COVID-19 pandemic, the concerns persist since the data for this review did not fully cover the impacts by the pandemic. Against this backdrop, continued support and assistance from the international community is as much necessary as before the review, especially in the crucial transition period”
UN Resident Coordinator to the Lao PDR, Ms. Sara Sekkenes, said “Graduating from the group of LDCs has been a development goal for Lao PDR for many years, one that has been emphasized in the country’s national socio-economic development plans and policy priorities. Therefore, it is very welcome to see the country’s consistent progress across a broad range of indicators, despite the many development challenges faced, including the setbacks presented by the COVID 19 outbreak but nevertheless, leading to the CDP recommendation that it graduate.”
The CDP, a subsidiary body of the UN Economic and Social Council (ECOSOC), reviews the LDC category every three years and recommends to ECOSOC and the UN General Assembly which countries should be included into, or graduated from the list. There are currently 46 countries on the list of LDCs.The review is based on both quantitative criteria - Gross National Income per capita, Human Assets Index and Economic and Environmental Vulnerability Index - as well as country-specific additional information. This year in particular, the CDP considered the impact of COVID-19 on development progress, which in turn played a role in the decision to recommend an extended preparatory period before graduation itself would take place.
During the preparatory period, Lao PDR remains on the list of LDCs and continues to benefit from all special support measures associated with LDC status and their preferential treatment.
As part of the preparations for the review, thorough analysis of the potential implications of graduation as well as the vulnerability to potential set-backs was, and will continue to be conducted. Over the course of the preparatory period, this information will be used by the Government to guide the development of a smooth transition strategy to appropriately manage Lao PDR’s transition from the list of LDCs. This includes making use of the remaining periods of LDC-specific support measures strategically; conceiving, assessing and negotiating alternatives in critical areas like trade; and preparing government, private sector and other stakeholders for the expected impacts.
“The move towards graduation not only reflects higher levels of income and improved human assets, but also sets the stage for more positive views from investors and a stronger position in international integration and engagement. Importantly, the Government has taken a proactive approach to addressing COVID-19 impacts, but nevertheless in light of the country’s fiscal challenges that were growing before the pandemic and exacerbated since, it will be important for the international community to step up support to the transition process that Lao PDR is now moving towards,” added Ms. Sara Sekkenes.
For the next step, the CDP will present its recommendations to ECOSOC for endorsement in June, and to the UN General Assembly in September 2021.
The CDP will continue to monitor the development progress of Lao PDR as it moves towards graduation, and provide independence advice and inputs to ECOSOC on international cooperation for development, in light of any changes that would warrant adjustment to the anticipated graduation timetable.