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

Fresh fruit and vegetable market in Port Vila, Vanuatu. Photo: Shutterstock

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.

At this time of exacerbated economic vulnerabilities, some have questioned whether this is the right time for Vanuatu to leave its LDC status behind. Indeed it is a courageous choice – on the surface it may seem that there is more to lose than gain from graduation. Graduating countries usually surrender international support measures earmarked for LDCs such as preferential market access, targeted multilateral aid funding, free legal advice and technical assistance from some United Nations agencies, as well as travel support to attend international UN meetings.

While the impact of losing international support measures will depend on what goods a country exports, the trade agreements it is part of, and other factors, the UN’s Committee for Development Policy’s (CDP) LDC graduation impact assessments have shown that the loss of these measures doesn’t actually make much of a practical difference.

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