This paper provides an evaluation of the social and economic impacts of the COVID-19 pandemic on least developed countries (LDCs) in Asia and the Pacific. Drawing on analysis and estimates from various regional and national sources, this paper finds that these impacts are large relative to the number of COVID-19 cases for several reasons. First, the size of stimulus packages to cushion the economic impacts of the pandemic was significantly smaller than other developing countries. Second, their undiversified export baskets suffered from disruptions in regional and global supply chains and in tourism-related activities. Third, due to the presence of large informal sector and the lack of social protection, job losses have directly translated into income losses. All these factors are further compounded by bleak external conditions surrounding official development assistance (ODA), foreign direct investment (FDI) and remittances.
Accordingly, the paper argues that the COVID-19 pandemic has dimmed prospects of Asia-Pacific LDCs to realize the Sustainable Development Goals (SDGs) by 2030. In addition, while the pandemic will not significantly delay their graduation from the LDC category, preparations for graduation must acquire a much more holistic focus on sustainability.
Looking forward, the paper suggests Asia-Pacific LDCs reassess their development strategies to accelerate progress towards achieving SDGs and to ensure smooth graduation and transition through the following broad sets of actions: (a) scaling up mitigation and recovery programmes and relief measures; (b) building productive capacities and promoting economic diversification to fundamentally addressing multidimensional poverty in the long run; (c) investing in healthcare and social protection systems, including through the use of digital technologies; and (d) negotiating with their key trading partners and multilateral financial institutions to deepen and extend existing preferential provisions to facilitate graduation and smooth transition.