In Asia-Pacific, a person living in a least developed country, and in a small island country in particular, is much more likely to be affected by natural disasters than someone living in any other country of the region. Their small population, less diversified economies, and dependence on imports and aid makes them also very vulnerable to economic shocks. Furthermore in many cases aggressive mining of resources results in unsustainable patterns of economic growth. In addition, least developed countries have to confront challenges posed by climate change and threats to biodiversity.
The overarching goal of the Programme of Action for the decade 2011-2020 is “to overcome the structural challenges faced by the least developed countries in order to eradicate poverty, achieve internationally agreed development goals and enable graduation from the least developed country category”. Some of the critical challenges faced by the LDCs are lack of institutional and human resources to achieve inclusive and sustainable development.
This session will assess some of the important trends in the shares of trade, aid and financial flows accounted for by the LDCs during the IPoA process and, in light of that experience and also given the global economic crisis of the recent past, consider new priorities for action.
Trade has an important role in ensuring least developed countries’ (LDCs) sustainable economic development. While the last decade saw LDCs’ collective share in international trade nearly doubling, it is still hovering at just over 1 per cent of world merchandise trade, and it is highly concentrated on a few countries and export products. In order to benefit from trade, both demand and supply conditions must be improved.
The majority of the poor in Asia-Pacific LDCs still live in rural areas and rely heavily on the agricultural sector for employment and subsistence living. It is well established that GDP growth originating in agriculture benefits the poorest significantly more than growth in other sectors, yet investment in the agricultural sector has been low and declining over the past two decades.
Least developed countries’ (LDCs) feature limited productive capacities, which constrain their ability to produce efficiently and effectively and to diversify their economies. This handicap translates into binding supply constraints and ultimately into weak export and economic potentials and limited generation of productive employment and social development prospects.