Expanding Productive Capacity: Lessons Learned from Graduating Least Developed Countries

What policy interventions might be beneficial for Least Developed Countries to overcome their lack of productive capacity? This Policy Note from the Committee for Developement Policy (CDP) aims to provide some answers by analyzing the strategies and policy choices of 14 countries that have successfully graduated from the LDC category, or have made noteworthy progress towards graduation. It contains a wide range of lessons not only relevant to all LDCs but the international community at large.

The note highlights the need for integrated policies across five broad policy areas: (I) development governance; (II) social policy; (III) macroeconomic and financial policies; (IV) industrial and sectoral policies; and (V) international support as the analytical framework for the expansion of productive capacity. It also emphasizes the need for different national strategies and tailored international support due to the diversity of LDCs. In this regard, three different pathways towards graduation are identified, each one with different implications for the process of expanding productive capacity. Characteristics and key lessons for each graduation pathway are explained in this note.

Read more: CDP Policy Note: Expanding Productive Capacity: Lessons Learned from Graduating Least Developed Countries