LDCs in Asia-Pacific. Graduation, challenges and opportunities. Namsuk Kim, Ph.D. Economic Affairs Officer CDP Secretariat UN DESA

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1 LDCs in Asia-Pacific Graduation, challenges and opportunities Namsuk Kim, Ph.D. Economic Affairs Officer CDP Secretariat UN DESA

2 THE CDP AND THE LDCS CDP Secretariat

3 Committee for Development Policy Subsidiary body of ECOSOC Policy advice Identification of LDCs: o Triennial reviews o Methodology and process o Monitoring of graduating and graduated LDCs CDP Secretariat (DESA): Dissemination of CDP work Substantive support LDC Portal on support measures Capacity development

4 LDC category Concern about countries consistently lagging behind Category created in 1971 Special measures for catching up with other developing countries From 25 to 47 Countries; 5 graduations, 2 more in the pipeline Triennial reviews: inclusion and graduation Committee for Development Policy Economic and Social Council General Assembly Using a set of indicators and additional information CDP Secretariat

5 Graduation eligibility Two out of 3 criteria (Income, HAI, EVI) Or Income only criterion Meet graduation criteria for 2 consecutive reviews (e.g. in 2015 and 2018) CDP Secretariat

6 Graduation timeline (hypothetical) Year Process 2015 March CDP finds the country meets the graduation criteria. Requests Impact assessment (DESA) and vulnerability profile (UNCTAD) 2018 February CDP EGM to see if the country meets the graduation criteria again. Review the IA, VP, country s view and other information 2018 March CDP decides to recommend the country to graduate 2018 July ECOSOC endorses 2018 December GA takes note and determines the transition period (e.g. 3 years) The country prepares a smooth transition strategy; CDP monitors and reports to ECOSOC (annually) 2021 December The country graduates 2022 The country implements the smooth transition strategy; CDP monitors and reports to ECOSOC (annually until 2025 and in 2027 and 2030)

7 Graduation procedures Several years Multi stage process Multiple actors Based on rigorous methodology Objective: no country to fall back into the category CDP Secretariat

8 Graduation trend Human asset index (HAI) Economic vulnerability index (EVI) Based on the 2015 triennial review data Graduating LDCs Nepal Sao Tome and Principe Bhutan Samoa Equatorial Guinea Angola LDCs meeting two criteria or income-only criterion Vanuatu Tuvalu Solomon Islands Timor Leste South Sudan LDCs meeting one criterion Kiribati LDCs Remaining LDCs (South Sudan) 49 LDCs (Samoa) 48 LDCs (Equatorial Guinea) 47 LDCs 2018 review 2 LDCs graduating 7 LDCs eligible 38 LDCs 2021 review?

9 LANDLOCKED LDCS IN ASIA PACIFIC CDP Secretariat

10 Bhutan High income and human assets Vulnerable to natural disasters and agricultural shocks

11 Bhutan Impact assessment preliminary findings Trade No or minor impact on major export products (e.g. electricity, cement) No or minor impact in potential destinations (e.g. EU, Singapore, Hong Kong) Possible negative impact on potential exports (e.g. agricultural products to EU, Thailand) WTO accession No or minor impact on aid for trade Development cooperation No or minor impact on bilateral, multilateral, private flows General support No or minor impact

12 Nepal Diversified with human assets Low income

13 Nepal Impact Assessment preliminary findings Trade Possible negative impact on major export products (e.g. carpets and apparels to Canada and EU) Possible impact in new destinations (e.g. textile to China, vegetables to EU, Japan) Possible negative impact on potential exports (e.g. herb and footwear) Unclear on Services, WTO obligations No or minor impact on aid for trade Development cooperation No or minor impact on bilateral, multilateral or private flows Possible changes from Germany, Japan, Korea General support No or minor impact

14 LAO PDR Diversified with income growth Getting eligible Child mortality, undernourishment Education Global Value chain Agricultural economy Natural disasters

15 POLICIES AND SUPPORT CDP Secretariat

16 Pathways toward graduation (Not all LDCs or LLDCs are the same) 1. Rapid growth through natural resource exploitation 2. Economic specialization and investment in human capital 3. Graduation through economic diversification, structural transformation and the development of human capital

17 Support for LDCs (What s relevant to LLDC LDC in AP?) Trade Preferential market access SDTs related to WTO obligations Capacity building Development cooperation Bilateral Multilateral General support Contribution to international organizations Travel and research

18 Thank you Namsuk Kim UN/DESA