Daily Sun | 15 June 2026
Govt to focus on FTA, PTA, EPA with partners to address post-LDC challenges
by Rafikul Islam
In view of the changing global trade environment and the possible reduction of duty-free and quota-free facilities following Bangladesh’s graduation from the Least Developed Country (LDC) category, the government is undertaking necessary initiatives to preserve the country’s competitiveness in global trade.
In this context, the government’s efforts are underway to finalise trade and investment partnership and cooperation agreements with potential partner countries – such as Free Trade Agreements (FTA), Preferential Trade Agreements (PTA) and Economic Partnership Agreements (EPA) – in line with regional trade arrangements.
In his proposed budget speech, Finance Minister Amir Khosru Mahmud Chowdhury said this, adding that as Bangladesh prepares for the post-LDC graduation competition, a stronger business-enabling environment is increasingly important for 181 export diversification, higher investment flows, productive employment and sustainable growth.
“This deregulation-related reform programme is a practical step towards that objective. Through it, we seek to build a Bangladesh where entrepreneurs invest with confidence, investors can plan for the long term, and the benefits of economic activity reach more people,” he stated.
The minister said that, “Our export sector remains highly vulnerable due to an overdependence on a narrow product base and limited market diversification. This structural challenge will be acutely felt once Bangladesh graduates from LDC status.”
“‘The preferential tariff benefits, duty-free and quota-free market access, and policy flexibilities currently enjoyed as an LDC will gradually be phased out after graduation,” he said.
Amir Khosru highlighted that in this context, proactive and immediate preparation is essential. Bangladesh has no alternative but to pursue product diversification, enhance quality and compliance standards, expand into non-traditional markets, negotiate bilateral trade agreements, modernise port and customs infrastructure, and strengthen overall export competitiveness.
Govt formally requested deferral of LDC graduation
Amir Khosru explained that against this backdrop, the government has formally requested a deferral of LDC graduation for at least three years.
This additional timeframe is necessary to implement key domestic reforms and ensure a smooth and resilient economic transition, the minister pointed out.
According to Prof Mustafizur Rahman, Distinguished Fellow at Centre for Policy Dialogue (CPD), the government has formally submitted a proposal to the United Nations Secretary-General (UNSG) seeking a further three-year extension of the preparatory period for Bangladesh’s graduation from the LDC category.
“If the proposal is approved at the upcoming session of the UN General Assembly in September, Bangladesh must continue its efforts to strengthen domestic capacities and advance structural reforms,” the noted economist said.
He stated that to ensure a sustainable transition from LDC status, Bangladesh must move beyond capabilities that rely primarily on preferential market access and instead develop competitiveness driven by productivity, efficiency, and skills.
“In order to successfully address the challenges of the post-LDC era and consolidate the country's position in the global marketplace, the budget should reflect clear and transformative measures aimed at fostering industrial development, attracting private investment, and ensuring a business-friendly environment,” he added.
UN panel recommends shorter extension
The UN Committee for Development Policy (CDP) has recently recommended that the UNGA grant a shorter extension to Bangladesh for its preparatory period for graduation from the LDC category.
Bangladesh has sought three more years to prepare for LDC graduation, until 24 November 2029, extending the original 24 November 2026 deadline.
The recommendation follows Bangladesh's formal request submitted on 18 February 2026 and a subsequent letter from the prime minister to the UN secretary-general on 6 April, according to an Economic Relations Division (ERD) statement issued recently.
In a statement said that CDP Chairman José Antonio Ocampo informed Bangladesh that, based on the committee's assessment, it would be appropriate for the UNGA to approve a shorter extension of Bangladesh's preparatory period for LDC graduation.
Final decision is likely at UN session in September.
