14 September 2020. In February 2021, the Committee for Development Policy (CDP) will hold its triennial review of the LDC category. Among other tasks, it will be reviewing the list of LDCs and identifying countries to be recommended for graduation from the category.
On what will the CDP base its decision to recommend a country for graduation? Three criteria – GNI per capita, a human assets index (HAI) and an economic and environmental vulnerability index (EVI) – are applied to define which countries are included in the list of LDCs. To be considered for graduation, a country needs to have progressed on those criteria. More specifically, it needs to have exceeded pre-established thresholds in two of the three criteria.* The CDP has to verify this progress at two successive triennial reviews. It then also reviews a set of additional information and documents, including assessments of the expected impacts of graduation and of the country’s vulnerabilities and a set of supplementary graduation indicators. It also considers the views of the country concerned.
How will it reflect the impacts of Covid-19? The impacts of Covid-19 will be considered as part of the supplementary information. The CDP is also conducting a comprehensive study on the impacts of Covid-19 on the LDC category. The CDP issued a statement on Covid-19 and the LDCs in May.
Which countries are being assessed? Bangladesh, Lao PDR, Myanmar, Nepal and Timor-Leste all met the graduation criteria in 2018 and are therefore candidates for a recommendation at the 2021 review, depending on their performance on the criteria and factors covered by the supplementary information and documents. Nepal and Timor-Leste had already met the criteria for a second time in 2018, but at that time the CDP had chosen to defer recommending these countries for graduation due to concerns about the sustainability of their development progress.
What happens once the CDP recommends a country for graduation? Once the CDP has recommended a country for graduation, the Economic and Social Council (ECOSOC) must endorse that recommendation through a resolution and the General Assembly must then take note. The country would effectively graduate after a preparatory period. Whereas the standard period is 3 years, the General Assembly has granted longer periods in the past. The CDP will include a statement on the length of the preparatory period in its recommendation. After a country graduates, it will no longer have access to international support measures that are exclusive to LDCs. Many of these measures have smooth transition provisions, which typically means that countries continue to benefit from these measures for a number of years after graduation.
* Thresholds for the HAI and EVI remain the same in 2021 as in 2018: 66 or above for the HAI; 32 or below for the EVI. The GNI per capita threshold for inclusion in the LDC category is set as the three-year average of the GNI per capita level which the World Bank defines for low-income countries. For 2021 the inclusion threshold will be $1,018. The threshold for graduation is set as 20 per cent above the inclusion threshold; it will be $1,222 for the 2021 review. The income-only graduation threshold is twice the normal graduation threshold and will be $2,444 in 2021. Data used in the triennial reviews can be found here.
More information on the LDC category and graduation procedures: