BANGLADESH’S scheduled transition from the United Nations Least Developed Country classification on 24 November 2026 has been celebrated nationally as a landmark of economic achievement and a symbol of national pride. Official statements and media commentary emphasise the country’s rising gross national income, improved human development indicators, and strengthened resilience to environmental shocks. Yet beneath this triumphant narrative lies a far more complex and precarious reality. Graduation from the Least Developed Country category does not merely mark symbolic progress; it entails leaving behind an international legal framework that provided extensive ‘special and differential treatment’ and entering a system whose protections are fragmented, provisional and politically contested. In effect, Bangladesh risks advancing on the development ladder without a safety net.
The central issue is not that the World Trade Organisation is inherently antagonistic towards least developed countries. Rather, Bangladesh has not yet formulated a cohesive legal and strategic plan to manage its transition, either in Geneva, where international trade negotiations are conducted, or domestically in Dhaka. United Nations graduation is facilitated by the Committee for Development Policy and was ratified by a United Nations General Assembly resolution in 2021, which confirmed that Bangladesh would graduate in 2026 after meeting three criteria in successive triennial reviews: gross national income per capita, the Human Assets Index, and the Economic and Environmental Vulnerability Index. The significance of this United Nations designation is far-reaching. The World Trade Organisation’s legal framework relies on the United Nations Least Developed Country list. Once Bangladesh ceases to be classified as a least developed country, certain clauses that explicitly apply to ‘least developed country members’ will no longer be operative.
The legal foundation for these protections stems from the 1979 ‘Decision on Differential and More Favourable Treatment, Reciprocity and Fuller Participation of Developing Countries,’ also known as the Enabling Clause. This clause permits developed countries to extend unilateral, non-reciprocal preferences to developing countries and anticipates special treatment for the least-developed among developing countries. Further, the General Agreement on Tariffs and Trade 1994, Part Four, Articles Thirty-Six to Thirty-Eight, established a framework allowing least developed countries such as Bangladesh to obtain duty-free, quota-free access to international markets and more lenient regulatory obligations without offering reciprocal concessions. These protections enabled Bangladesh to expand its export base, particularly in textiles and garments, while nurturing nascent industries without facing punitive trade barriers.
Graduation does not remove all special and differential treatment. Bangladesh will continue to be classified as a developing country under World Trade Organisation rules. However, it will lose the most significant least-developed country-specific flexibilities, precisely at a time when the country’s export structure remains concentrated and its industrial strategy is still developing. Recent international developments provide only limited relief. The Thirteenth World Trade Organisation Ministerial Conference Decision on ‘Smooth Transition Support Measures for Countries Graduated from the Least Developed Country Category,’ adopted in March 2024, offers two binding advantages for graduating least developed countries: a three-year extension of certain procedural flexibilities under the Dispute Settlement Understanding, and an additional three years of eligibility for technical assistance and capacity-building programmes following the effective date of United Nations graduation. While Bangladeshi media has portrayed this as a generous ‘smooth transition,’ legally these measures are narrow and do not address the most critical areas of vulnerability.
Two legal frameworks in particular demand attention. First, under the Agreement on Trade-Related Aspects of Intellectual Property Rights, Article Sixty-Six Point One, least developed country members are exempted from applying most provisions of the agreement until a transition period, currently extended until 1 July 2034. Bangladesh’s graduation in November 2026 will trigger these obligations years earlier than initially intended, constraining policy options for pharmaceutical patents, technology transfer, and domestic innovation. Second, under Article Twenty-Seven Point Two of the Agreement on Subsidies and Countervailing Measures and Annex Seven, least developed countries are exempt from the general prohibition on export subsidies, providing essential latitude to support exporters in line with developmental objectives. Graduation will subject these fiscal incentives, particularly in ready-made garments-dominant export processing zones and special economic zones, to heightened scrutiny. The ministerial decision of 2024 deferred these critical matters to future negotiations, leaving Bangladesh reliant on non-binding encouragement rather than legally enforceable protections.
Compounding these legal challenges, the global politics surrounding special and differential treatment are shifting. Large advanced economies are increasingly sceptical of open-ended privileges for least developed countries. China’s 2025 declaration that it will forego such benefits in future World Trade Organisation negotiations exemplifies a trend towards targeted, case-by-case flexibilities rather than open-ended entitlements based on status alone. Graduating least developed countries, including Bangladesh, are caught in a transitional limbo: stripped of formal least developed country protection, yet without a clearly defined set of enforceable, vulnerability-based exemptions.
Domestically, discussions have largely emphasised technical and economic measures: tariff rationalisation, export diversification, macroeconomic resilience, and investment in skills. Think tanks such as the Centre for Policy Dialogue and the South Asia Network on Economic Modelling, along with national media outlets, have highlighted potential declines in exports and threats to the competitiveness of the ready-made garments sector. Yet far less attention has been devoted to questions of hard law. Which specific World Trade Organisation provisions will become inoperative in 2026? What binding substitutes, if any, are under negotiation? How will Bangladesh operationalise flexibilities under the Agreement on Trade-Related Aspects of Intellectual Property Rights and the Agreement on Subsidies and Countervailing Measures post-graduation? Is the country prepared to initiate litigation if preference erosion or stricter enforcement of regulations compromise its legitimate expectations?
Bangladesh’s current strategy appears largely technical rather than legal-political. A Smooth Transition Strategy has been implemented, and coordination mechanisms have been established for domestic reforms. While these efforts are necessary, they are insufficient to safeguard the country’s trade and industrial interests. To secure a resilient post-graduation position, Bangladesh must adopt three strategic shifts. First, it should advocate explicitly and transparently for time-limited extensions of flexibilities under Article Sixty-Six Point One of the Agreement on Trade-Related Aspects of Intellectual Property Rights and Annex Seven of the Agreement on Subsidies and Countervailing Measures, tailored to the country’s export structure and technological development needs. Second, it must pursue binding guarantees for market access rather than relying on discretionary actions by preference-granting nations, potentially through coalitions with other graduating least developed countries to secure time-bound waivers in exchange for domestic reforms. Third, special and differential treatment should be integrated into national development strategy. Tariff policies, industrial frameworks, and investment plans must be designed with clarity on which flexibilities endure post-graduation, which are negotiable, and which will be eliminated. Institutional capacity, regulatory coherence, and readiness to enforce rights through World Trade Organisation dispute mechanisms are critical.
Bangladesh’s graduation is not a simple milestone. It represents a shift from a formal, treaty-supported set of privileges to an ambiguous developing-country status amid evolving international norms. Whether this transition becomes a springboard for a more assertive, legally informed international economic strategy or a trigger for preference erosion and constrained policy space will depend on decisions made in Dhaka and Geneva over the next two years. Symbolic celebrations and technocratic planning alone will not suffice. A nation that has leveraged least developed country privileges more effectively than almost any other cannot afford to graduate without constructing its own safety net.
Samanta Azrin Prapty is a legal researcher.
