What are the least developed countries?

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What are the least developed countries?
The Least Developed Countries Report 2021: The least developed countries in the post-COVID world: Learning from 50 years of experience

Geneva, Switzerland, 27 September 2021

There are currently 46 economies designated by the United Nations as the least developed countries (LDCs), entitling them to aid, preferential market access and special technical assistance, among other concessions. These 46 LDCs are distributed among the following regions:

  1. Africa (33): Angola, Benin, Burkina Faso, Burundi, Central African Republic, Chad, Comoros, Democratic Republic of the Congo, Djibouti, Eritrea, Ethiopia, Gambia, Guinea, Guinea-Bissau, Lesotho, Liberia, Madagascar, Malawi, Mali, Mauritania, Mozambique, Niger, Rwanda, Sao Tome and Principe, Senegal, Sierra Leone, Somalia, South Sudan, Sudan, Togo, Uganda, United Republic of Tanzania and Zambia
  2. Asia (9): Afghanistan, Bangladesh, Bhutan, Cambodia, Lao People’s Democratic Republic, Myanmar, Nepal, Timor-Leste and Yemen
  3. Caribbean (1): Haiti
  4. Pacific (3): Kiribati, Solomon Islands and Tuvalu

Establishment of the list of the least developed countries

The list of LDCs is reviewed every three years by the Committee for Development Policy (CDP), a group of independent experts that report to the Economic and Social Council (ECOSOC) of the United Nations. Following a triennial review of the list, the CDP may recommend, in its report to ECOSOC, countries for addition to the list or graduation from LDC status.

Between 2017 and 2020, the CDP undertook a comprehensive review of the LDC criteria, and the ensuing revisions were first applied at the triennial review that took place in February 2021. The revised criteria and the thresholds for inclusion into the LDC category and for graduation from the category applied at the 2021 triennial review are as follows:

  1. An income criterion, based on a three-year average estimate of the gross national income (GNI) per capita in United States dollars, using conversion factors based on the World Bank Atlas methodology. At the 2021 triennial review, the threshold for inclusion was $1,018 or below; the threshold for graduation was $1,222 or above.
  2. A human assets index (HAI), consisting of two sub-indices: a health sub-index and an education sub-index. The former sub-index consists of three indicators: (i) the under-five mortality rate; (ii) the maternal mortality ratio; and (iii) the prevalence of stunting. Conversely, the education sub-index encompasses: (i) the gross secondary school enrolment ratio; (ii) the adult literacy rate; and (iii) the gender parity index for gross secondary school enrolment. All six indicators are converted into indices using established methodologies with an equal weight. The 2021 triennial review set the thresholds for inclusion and graduation at 60 or below and 66 or above, respectively.
  3. An economic and environmental vulnerability index, consisting of two sub-indices: an economic vulnerability sub-index and an environmental vulnerability sub-index. The economic vulnerability sub-index has four indicators: (i) share of agriculture, hunting, forestry and fishing in GDP; (ii) remoteness and landlockedness; (iii) merchandise export concentration; and (iv) instability of exports of goods and services. The environmental vulnerability sub-index has four indicators: (i) share of population in low elevated coastal zones; (ii) share of the population living in drylands; (iii) instability of agricultural production; and (iv) victims of disasters. All eight indicators are converted into indices using established methodologies with an equal weight. The 2021 triennial review set the thresholds for inclusion and graduation at 36 or above and 32 or below, respectively.

At each triennial review, all countries in developing regions are reviewed against the criteria. If a non-LDC meets the established inclusion thresholds for all three criteria in a single review, it can become eligible for inclusion.

Inclusion requires the consent of the country concerned and becomes effective immediately after the General Assembly takes note of the Committee’s recommendation. No recommendations were made for inclusion at the CDP’s 2021 triennial review.

Graduation from least developed country status

To graduate from the LDC category, a country must meet the established graduation thresholds of at least two of the three criteria for two consecutive triennial reviews.

Countries that are highly vulnerable, or have very low human assets, are eligible for graduation only if they meet the other two criteria by a sufficiently high margin. As an exception, a country whose per capita income is sustainably above the “income-only” graduation threshold, set at twice the graduation threshold ($2,444 at the 2021 triennial review), becomes eligible for graduation, even if it fails to meet the other two criteria.

Six countries have graduated from least developed country status since the creation of the category:

  1. Botswana in December 1994
  2. Cabo Verde in December 2007
  3. Maldives in January 2011
  4. Samoa in January 2014
  5. Equatorial Guinea in June 2017
  6. Vanuatu in December 2020

The CDP has recommended graduation from the LDC category for several countries in the past. Among them, Bhutan is scheduled for graduation in 2023, while Sao Tome and Principe and Solomon Islands are slated for graduation in 2024.

Angola was expected to graduate in 2021, but in the wake of a prolonged recession, and the COVID-19 outbreak, the General Assembly decided on 11 February 2021 to grant Angola an additional preparatory period of three years; hence the country is also scheduled for graduation from LDC status in 2024.

Kiribati and Tuvalu were recommended for graduation in 2018 and 2012 respectively, and both again in 2021. ECOSOC recognized the unprecedented socioeconomic impacts of the COVID-19 global pandemic, and decided to defer the consideration of their graduation again until 2024.

The CDP’s 2021 Triennial review considered for graduation from LDC status three countries (Bangladesh, Lao People’s Democratic Republic and Myanmar), which met the graduation criteria for the second time; and Nepal and Timor-Leste, which had met the graduation criteria for the second time in 2018, but for which the CDP had deferred its decision.

The committee recommended for graduation from the LDC category Bangladesh, Lao People’s Democratic Republic and Nepal. Because of the COVID-19 pandemic, the committee recommended an extended preparatory period, as well as careful monitoring and analysis of the impacts of the pandemic, and specific transition support.

The committee decided to defer its decision on the cases of Myanmar and Timor-Leste to the CDP’s 2024 Triennial review. ECOSOC, in resolution 2021/11, endorsed the CDP’s recommendation for all five countries.

Lastly, in the CDP’s 2021 review of the list of LDCs, the following countries were found to have met the graduation thresholds for the first time: Cambodia, Comoros, Djibouti, Senegal and Zambia.

Djibouti met the “income-only” criterion; Comoros, Senegal and Zambia met the graduation thresholds for two of the three criteria, namely income and human assets; and Cambodia met all three graduation criteria (income, human assets, and economic and environmental vulnerability).

These countries will be reviewed again in 2024 and, if they meet the criteria for a second time, could be recommended for graduation.

Figure: Least Developed Countries (46)

Africa 33, Asia 9, Caribbean 1, Pacific 3