Strategy for graduation with momentum: Bridging pre-graduation and post-graduation development processes in the least developed countries

UNCTAD Policy Brief No. 99

The development path followed by a country prior to graduation from the least developed country category has significant implications with regard to the challenges to be faced after graduation.

The current conceptualization of a smooth transition strategy primarily aims to create a short-term post-graduation “soft landing” and ease concerns with regard to preparation for engaging in economic relations as a non-least developed country. Therefore, the concept currently does not have a focus on preparing countries for graduation with momentum.

UNCTAD has maintained that the post-graduation success of a country significantly depends on the foundations built prior to graduation. Graduating countries need a new strategy, one that prepares them for the challenges ahead by linking the graduation process with the development of productive capacities and sustainable development.

UNCTAD has proposed an alternative policy framework to help refocus the objectives and strategic direction of graduation strategies, as well as a new time frame for implementation.

Key points:

  • The least developed countries may alter graduation time frames due to concerns with regard to no longer having access to international support measures; such concerns are symptomatic of underdeveloped productive capacities.
  • The current smooth transition strategy is primarily focused on the post-graduation development trajectories of countries, rather than on identifying and correcting development challenges prior to graduation.
  • UNCTAD proposes a new strategy and time frame centred on building productive capacities and achieving structural transformation prior to graduation, so that countries can graduate with momentum.