The Coronavirus pandemic has placed severe demands on the resources of nations, that they must skilfully manage in order to not get derailed from medium-to-longer term trajectories. By now, even those with only a rudimentary appreciation of economics, to state the most important example, would be able to tell you that in forging our recovery from the sheer scale of this catastrophe, we cannot afford to divorce the economic crisis that has befallen us from the healthcare or biological disaster.
To be sure, we commenced what is still a fairly new year with the hope that at some point during 2021(preferably the first half), the various vaccines that have all come out will have played their part in significantly reducing the burden of disease across all our societies. At that point, it will be interesting to note which countries are able to quite literally, take off from where they left prior to the crisis, and which of them continue to lag behind, and the extent of this lag.
When it comes to Bangladesh, we know that when the virus struck, there was every possibility that it would throw the economy off track from achieving one of its most cherished objectives: the long-anticipated graduation out of the league of least-developed countries, or LDCs, that the UN and other aid agencies maintain in order to specifically target their policy interventions and aid monies at those who need them most. The LDCs enjoy certain exemptions, such as liabilities under international intellectual property laws for essential items such as pharmaceuticals.
The prospect of losing out on such advantages, not to mention others such as concessionary interest rates and repayment schedules on loans, and various trade benefits, that too at a time when the full extent of the hit from the pandemic remain unclear, had given rise to a school of thought that Bangladesh should ask to abandon the graduation process. A number of economists came out in favour of such a move, while others voiced their opinions against it. In an editorial last June, we opposed it on the grounds that the Bangladesh economy was in no position to look back, and the evidence was simply not there to conclude the economy had been so severely emaciated from its pre-pandemic state.
This week, in an important meeting as part of preparations for the tri-annual review session of the United Nations Committee for Development Policy, the UN body responsible for conferring graduation or otherwise, the government confirmed that it would not take any backward step, and instead formulated a proposal to allow the country to avail the benefits it does as part of the LDC group for five years in light of the pandemic’s effects, instead of the three that graduates usually get, to allow them to transition out of the group and avoid any hard landings. By all accounts, the proposal was well-received, although we’ll have to wait till the actual review takes place next month, to know for sure whether the UN is receptive. Till then, let’s keep our fingers crossed, and keep looking ahead.