Download CPD’s Presentation | UNCTAD’s LDCs Report 2019
At the current development finance landscape, the agenda of of aid effectiveness has to be revitalised. The shortfall in domestic savings in the Least Developed Countries (LDCs) makes these countries dependent on external development finance, especially official development assistance (ODA). However, both the quantity and quality of ODA are critically important for the LDCs to have a meaningful impact of aid on the recipient countries. At the same time, the LDCs also need to strengthen their capacity to drive structural transformation and sustainable development through effective mobilization and management of domestic resources.
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These findings were presented at a media briefing organised by Centre for Policy Dialogue (CPD) on “Launching of UNCTAD’s The Least Developed Countries Report 2019: The present and future of external development finance – old dependence, new challenges”, held on 20 November 2019 at the Economic Reporters’ Forum (ERF), Dhaka. The event was organised as part of the global launching of the LDCs report 2019, prepared by the United Nations Conference on Trade and Development (UNCTAD). The annual LDCs report of the UNCTAD highlights the status of economic development and related challenges and opportunities for the countries in the LDC group.
Mr Towfiqul Islam Khan, Senior Research Fellow, CPD, made a presentation based on the findings of the UNCTAD’s LDCs report 2019. Mr Khan presented the status of structural transformation, financing, aid dependence, private development cooperation and fiscal policies of the LDCs. He also pointed out a comparative situation of Bangladesh with other LDCs.
Mr Khan informed that in Bangladesh, the resource gap, defined as the difference between domestic savings and gross fixed capital formation, in 2015-2017 was lower than the LDC average 8 per cent of GDP. It will be necessary to revisit the aid effectiveness agenda established by the “Paris Declaration of 2005” on the quality of aid and its impact on development to take into account a significantly changed aid and development finance scenario, the UNCTAD’s LDCs Report pointed out.
Dr Debapriya Bhattacharya, Distinguished Fellow, said that Bangladesh’s dependence on foreign finance is high. He observed that 37 per cent of the annual development programmes rely on foreign finance. Dr Bhattacharya mentioned that Bangladesh is unable to arrange its required funds domestically. Additionally, financiers now expect Bangladesh to be able to borrow at high interest rates, given that the country will graduate from LDC status by 2024.
Dr Fahmida Khatun, Executive Director, CPD, as the Chair of the event, highlighted the Paris Principles of aid effectiveness. She mentioned that ownership, alignment, mutual accountability, and debt sustainability are key indicators of aid effectiveness.
Dr Khondaker Golam Moazzem, Research Director, CPD, was also present at the media briefing. The briefing was followed by a question and answer session with journalists from print and electronic media.
