Improving the measurement of export instability in the Economic Vulnerability Index: A simple proposal
March 29, 2019
The Least Developed Countries (LDCs) category was established by the United Nations in 1971 to take into account the diversity of developing countries and to provide relevant treatment for the poorest. Starting with 25 countries, the category has 47 LDC countries in 2019, mostly in Africa.
LDCs are characterized by low per capita income and structural handicaps that impede their development, justifying the particular attention and support measures from the international community. These structural handicaps are measured through an Economic Vulnerability Index (EVI) and a Human Assets Index (HAI).
FERDI's works on the Least Developed Countries focuses on the characteristics of the category and the improvement of LDC identification, and the effectiveness of their special treatment.
FERDI’s work starts by focusing on the LDC identification criteria and indicators.
The reference book Caught in a Trap, Identifying the least developed countries, published in English in 2009, presents the foundations of the LDC category and argues that they should have a special treatment, because they are poor countries facing severe structural handicaps to their development.
This research was led by Patrick Guillaumont, who chaired a UN expert group reporting to the Committee for Development Policy (CDP) to define, review and apply criteria for identifying LDCs.
The book is currently in a second edition, which takes into account the latest developments in the category of Least Developed Countries (LDCs). This second edition will be translated into French.
There are currently 3 criteria for identifying LDCs: low per capita income, low human capital level, and economic vulnerability. FERDI is evaluating these criteria and considering how they can be improved. Also it is examining how the EVI and the HAI can be aggregated into a combined indicator, and it is examining the creation of an index of "less likely development".
FERDI's research concerns the performance in terms of growth, poverty reduction, and progress towards sustainable development objectives. FERDI focuses on the effects of the three main categories of measures: trade preferences granted to LDCs, specific objectives of bilateral aid to LDCs, and a wide range of multilateral measures taken in favor of LDCs, mainly at the United Nations and the World Trade Organization (WTO).
The book Out of the trap. Supporting the Least Developed Countries, prepared over several years, will be the first comprehensive assessment of the effectiveness of measures taken in favor of LDCs. It is a collective work with contributions by 10 academics.
The book analyses the overall performance of LDCs, how their policies are influenced by structural factors, and how effective support measures have been in two key areas: external assistance (bilateral and multilateral) and trade support. It also examines the scope of the process for graduation out of the category, and the role of LDCs in global governance.
FERDI is a founding member of "LDC IV Monitor", which is an independent partnership established by 8 think tanks and academic institutions from Least Developed Countries (LDC) and partner countries. Its purpose is, in cooperation with the United Nations agencies responsible for monitoring the Program, to produce an independent and complimentary evaluation of the "official" follow-up to the 10-year program adopted in Istanbul in 2011 at the 4th United Nations Conference on LDCs.
FERDI is prominent on the LDC issue through the expertise and experience of its team, which enables relevant work to be carried out and FERDI influences decisions concerning LDCs.
