The Least Developed Countries represent the poorest and weakest segment of the international community. They comprise more than 880 million people (about 12 per cent of world population) but account for less than 2 percent of world GDP and about 1 percent of global trade in goods
Their low level of socio-economic development is characterised by weak human and institutional capacities, low and unequally distributed income and scarcity of domestic financial resources. They often suffer from governance crisis, political instability and, in some cases, internal and external conflicts. Their largely agrarian economies are affected by a vicious cycle of low productivity and low investment. They rely on the export of few primary commodities as a major source of export and fiscal earnings, which makes them highly vulnerable to external terms-of-trade shocks. Only a handful has been able to diversify into the manufacturing sector, though with a limited range of products in labour-intensive industries, i.e. textiles and clothing. These constraints are responsible for insufficient domestic resource mobilisation, low economic management capacity, weaknesses in programme design and implementation, chronic external deficits, high debt burdens and heavy dependence on external financing that have kept LDCs in a poverty trap.
The category of LDCs was officially established in 1971 by the UN General Assembly with a view to attracting special international support for the most vulnerable and disadvantaged members of the UN family.
The current list of LDCs includes 48 countries; 34 in Africa, 13 in Asia and the Pacific and one in Latin America. Cape Verde, Maldives and Samoa graduated from the list in 2007, 2011 and 2014 respectively.