Clusters of Least Developed Countries, their evolution between 1993 and 2013, and policies to expand their productive capacity (CDP Background Paper No. 33)

The conventional approach to least developed country (LDC) graduation has considered these countries as an undifferentiated group whose problems could be solved by means of similar measures focussing on domestic and international liberalisation, preferential aid allocations, and the promotion of their exports by means of trade preferences and free market access. This paper tries to go beyond this analytical and policy tradition and attempts to identify different LDC clusters in which underdevelopment is caused by specific economic and social conditions, and for which the solution depends not only on traditional support measures, but also on the implementation of differentiated, country-specific policies sensitive to the local context.