Despite the looming challenges of graduating from Least Developed Country (LDC) status by 2026, Bangladesh’s export sector continues to show resilience. According to the World Trade Organization’s World Trade Statistical Review 2024, Bangladesh exported $47.2 billion worth of goods last year, advancing to 58th position globally, up from 59th in 2023.
Experts say that while LDC graduation marks a milestone in economic development, it will also mean losing key trade privileges like duty-free access and special WTO benefits. Sectors like garments, pharmaceuticals, and electronics are expected to face new competitive pressures.To tackle this, the government has adopted a Smooth Transition Strategy, initiated bilateral trade talks, and formed a high-level expert committee to guide the process. Exporters and economists are calling for increased policy support, energy security, export credit incentives, and improved infrastructure to sustain this export momentum in the post-LDC era.
Despite the ongoing global recession, internal political unrest, and an unstable macroeconomic environment, Bangladesh’s export sector is showing resilience and optimism. Recent data from the World Trade Organization (WTO) reflects this growing strength. According to the WTO’s World Trade Statistical Review 2024, Bangladesh exported goods worth $47.2 billion in 2024, up from $44.23 billion in 2023-improving its position to 58th among global exporters, up one notch from the previous year. This export-driven progress is playing a vital role in easing the dollar crisis and gradually stabilizing the country’s foreign exchange reserves. But looming structural and policy challenges remain-especially with Bangladesh’s graduation from the Least Developed Country (LDC) group scheduled for November 2026.
LDC Graduation: A New Milestone Brings New Challenges: According to Professor Mostafizur Rahman, Honorary Fellow at the Centre for Policy Dialogue (CPD), Bangladesh’s graduation from the LDC category after 50 years marks both a symbolic and economic achievement. The country, along with Nepal, will be exiting a list that currently includes only Afghanistan in South Asia.
While LDC status offered Bangladesh duty-free, quota-free access to over 40 countries-benefiting nearly 70% of its exports-that privilege will soon be lost. Key sectors like garments and pharmaceuticals have long relied on relaxed WTO rules, subsidy allowances, and preferential market access. After graduation, many of these benefits will phase out.
Though the EU, UK, Canada, and China have pledged temporary extensions of duty-free access, such concessions are limited in scope and duration. Bangladesh will also lose its waiver on the WTO’s intellectual property rights regime, particularly affecting the domestic pharmaceuticals sector.
To meet these challenges, Bangladesh has already formulated a Smooth Transition Strategy, overseen by a high-level expert committee. The strategy focuses on transforming from market-access-based competitiveness to productivity and efficiency-based competitiveness, while also emphasizing labor rights, gender equality, and environmental sustainability.
Rahman emphasized the urgent need for Bangladesh to establish bilateral and multilateral trade agreements to replace the advantages lost due to LDC graduation. He noted that Bangladesh’s economy, population, and export base are far larger than previously graduated LDCs, adding complexity but also providing scale advantages-if managed well.
Cement Industry Cautious, Eyes Spillover Risks: Although not directly export-oriented, the cement industry is bracing for indirect impacts. Molla Mohammad Majnu, Managing Director of Crown Cement, highlighted that their major clients-garment factories-are essential for domestic demand. “If the garment sector shrinks due to tariff shocks and the post-LDC transition, we will inevitably suffer,” he warned.
Crown Cement, which commands nearly 46% of Bangladesh’s cement exports, is bogged down by bureaucratic hurdles, slow land port operations, and gas shortages. Interest rates ranging from 12-13% make capital expansion costly compared to regional competitors enjoying 4-5% rates.
Majnu believes policy continuity, bilateral trade pacts, energy security, and financing reforms are essential to unlock the cement sector’s full export potential. “We’re still in the cradle of industry,” he added. “But without long-term support, we will remain stuck.”
Walton’s Export Story: A Model for Electronics Industry Growth: Walton Hi-Tech Industries PLC is spearheading Bangladesh’s entry into high-tech exports. SM Mahbubul Alam, the company’s Managing Director, noted that Walton now exports to over 50 countries. Products range from refrigerators and ACs to compressors and IoT-enabled electronics.
“Export growth came from relentless R&D and participation in major international fairs,” Alam said. “We’ve moved from OEM exports to developing our own brand presence in Europe, Asia, and Africa.”
He emphasized the importance of government support, especially policy reforms to ensure that local manufacturers get more benefits than importers. High import duties on raw materials, especially for high-tech items like VRF ACs, remain a barrier.
Walton’s focus on environmentally friendly technologies has also earned it global recognition, including the SDG Brand Champion Award and the Green Factory Award. “We’ve eliminated harmful refrigerants and are aligned with international climate goals,” Alam stated.
To further boost exports, Alam urged the government to include all electronics products under duty-free categories in bilateral agreements, and to streamline export procedures through digital systems and tax exemptions.
Sea Fishing: Untapped Potential Needs Policy Attention: In the fisheries sector, Bangladesh has massive unrealized potential. Tanvir Shahriar Rimon, CEO of the Sea Fishing Division at Rancon Group, said only 700,000 tons of the 4.5 million tons of annual fish production comes from the sea-despite an estimated 7 million tons of available fish stocks.
“Our EEZ (Exclusive Economic Zone) remains largely underutilized,” he said. “Only 4,000-5,000 sq km are actively fished out of over 118,000 sq km.”
Challenges include outdated trawlers, poor cold storage, diesel price hikes, and illegal fishing practices that disrupt the ecosystem. While five commercial vessels have recently received EU export licenses, Rimon insists that government must share capital risks and offer subsidies, especially for high-potential marine shrimp, which is losing competitiveness to farmed Venami shrimp from India and Vietnam.
He also stressed the need for surveys to create new fishing grounds, technology transfer under PPP models, and financial incentives for commercial trawler operators during the seasonal fishing ban.
Banking Sector’s Vital Role in Export Financing: Mosleh Uddin Ahmed, Managing Director of Shahjalal Islami Bank PLC, called exports “the lifeblood of banking and the national economy.” From financing working capital to managing foreign exchange and export receivables, banks are central to the export ecosystem.
However, Bangladesh Bank’s move to raise LC (Letter of Credit) margins to control inflation and reserve outflows has created short-term disruptions. “The intention is good,” Ahmed said, “but it has affected business confidence.”
He emphasized the need to diversify exports beyond garments-into pharmaceuticals, leather, agriculture, and ICT-and reduce reliance on imported raw materials by investing in backward linkages.
Ahmed warned that the Trump administration’s proposed 35% tariff on Bangladeshi goods could harm both the RMG sector and its financial partners. “High interest rates increase costs for exporters. Without targeted interventions like subsidized export credit, we risk eroding our competitiveness.”
To bridge the gap, Ahmed recommended: Reintroducing the Export Development Fund (EDF) with favorable terms. Promoting factoring and non-bank financing options, Stabilizing inflation and exchange rates. Monitoring monetary policy impacts on export-linked sectors.
Optimism, but No Room for Complacency: Bangladesh’s export sector has reasons to be hopeful. Rising global rankings, success stories like Walton, and new EU fishing licenses are positive signals. However, the path ahead is steep. The LDC transition will test the country’s policy frameworks, industrial capacity, and financial systems.
There’s no alternative to preparation. Exporters must innovate, diversify, and digitize. The government must ensure policy continuity, build trade alliances, and invest in energy, ports, and backward linkage industries. As the country enters a post-LDC world amid rising geopolitical uncertainty and retaliatory tariffs, the ability to adapt and act boldly will determine whether Bangladesh merely survives-or thrives-in the global export arena.