Maldives no longer on UN poorest nation list

The Maldives graduated from the UN’s Least Developed Country (LDC) status to that of a middle income country on January 1.

The graduation is based on three factors which are gross national income (GNI) per capita, human resources (health, nutrition, education and adult literacy) and the economic vulnerability.

With the graduation, the particular country is bound to lose trade preferences and aid that it received as one of the world’s poorest nations.

However, the Maldives has voiced concerns over the matter citing its economic vulnerability.

In December 2010, Maldives Permanent Representative to the World Trade Organization (WTO) Iruthisham Adam told the General Council that despite the graduation, the Maldives remains acutely vulnerable at economic, commercial and environmental levels.

She said then that the UN had decided to remove the Maldives from the list of LDC countries on the basis of its strong socio-economic development over recent decades, but that in-so-doing the UN had ignored the issue of vulnerability.

In response, some key partners in the global trading system, offered support to the Maldives to adjust to the loss of LDC special preferences.  The Maldives with many other Small Island Developing States (SIDS) are vulnerable to external economic and environmental shocks such as the oil and financial crisis and the 2006 Tsunami.  Many of the LDCs are also Small Island Developing States also known as SIDS.

In October last year, the Minister of State for Foreign Affairs of the Maldives, Ahmed Naseem told a UN panel of experts that the Maldives needs support despite the graduation.

“He spoke of the small island paradox facing the Maldives: relative prosperity versus extreme vulnerability,” UN reported on the meeting.

“The Maldives is too vulnerable to be graduated,” he said, calling for special measures to be put in place to protect Small Island developing Nations as they graduate from the LDC category.

He pointed out that SIDS have neither the resources nor the experience to deal with globalization but their right to exist must be recognized by the international community.

There are 49 countries classified as LDCs and these nations have been identified as those suffering most from profound structural impediments to growth and prevalence of acute poverty. While they are home to some 800 million people (about 12% of the world’s population), they account for just 2% of global wealth (world GDP) and 1% of global trade in goods.