Amid cyclones and COVID-19, Vanuatu makes bold decision to graduate from ‘least developed country’ category

By Violeta Gonzalez Behar, Head of Partnerships, Outreach and Resource Mobilisation, Enhanced Integrated Framework (EIF), World Trade Organization & Michelle Kovacevic, Communications Specialist and Consultant for EIF

On 4 December 2020, Vanuatu shed its official classification as one of the world’s least developed countries (LDC). This significant milestone – called ‘graduation’ – is something that only five other countries have managed to achieve in the last 40 years. And Vanuatu’s graduation achievement may be the most impressive of all given that, over the past few years, not only has it has weathered significant economic and social fallout from repeated natural disasters, but also a major drop in tourism revenue due to border closures during the global COVID-19 pandemic.

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Middle-income countries should not be rushed to graduate

By Otaviano Canuto, Senior Fellow at the Policy Centre for the New South, Non-Resident Senior Fellow at Brookings Institution, and Former Vice President at the World Bank; Matheus Cavallari, Senior Advisor and Tiago Ribeiro dos Santos, Advisor at the Board of Executive Directors of the World Bank Group. Opinions here are their own. The authors wrote chapter 12 of the recent book: Alonso, J.A. & Ocampo, J.A. (eds.), Trapped in the Middle? Developmental Challenges for Middle-Income Countries, Oxford University Press, 2020

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Increasing income and resilience of the poorest: The role of economic inclusion programmes in social protection systems

By 1 : Aude de Montesquiou and Syed M. Hashemi (Partnership for Economic Inclusion 2 at the World Bank) and Alessandra Heinemann (ADB)

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While the past two decades saw spectacular progress in the fight against poverty, more than 10% of the world’s population – 735 million people – still live below USD 1.90 per day. Ending poverty in all its forms everywhere as envisioned in Agenda 2030 will prove challenging. Reaching the poorest is in itself difficult, but even more so is getting them onto a sustained pathway out of poverty because of the need for carefully managed, multi-sectoral interventions.

What could help? The graduation approach is one example of targeted household-level economic inclusion approaches with a proven track record of ensuring sustainable pathways out of extreme poverty.3  The graduation approach is specifically defined as a time-bound multi-sectoral “big push” intervention designed to overcome the multiple barriers that prevent extremely poor and vulnerable households from earning enough income and building sufficient human capital and assets to break out of such extreme poverty. The graduation approach typically offers extremely poor and vulnerable households a sequenced package of consumption support, of access to savings services, technical skills, transfer of productive assets, seed capital or an employment opportunity, and of coaching.

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The Transition from Least Developed Country Status

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By Dr Jodie Keane, Economic Adviser, and Dr Howard Haughton, Quantitative Analyst, Commonwealth Secretariat1


This blog is part of an ongoing series evaluating various facets of Development in Transition. The 2019 “Perspectives on Global Development” on “Rethinking Development Strategies” will add to this discussion.

To learn more about countries’ strategies for economic transformation, including a session on Least Developed Countries (LDCs), follow the 10th Plenary Meeting and High-Level Meeting of the OECD Initiative for Policy Dialogue on Global Value Chains, Production Transformation and Development in Paris, France on 27-28 June 2018.


The Least Developed Countries (LDCs) are an internationally defined group of highly vulnerable and structurally constrained economies with extreme levels of poverty. The Committee for Development Policy (CDP) is a subsidiary body of the United Nations Economic and Social Council (ECOSOC). Every three years, the CDP advises ECOSOC and the United Nations (UN) General Assembly on which countries should either enter or leave the LDC category. Since the category was created in 1971, only five countries have graduated and the number of LDCs has doubled on the basis of selected indicators (income, human assets, economic vulnerability). And when countries graduate they lose international support measures provided by the international community.

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