In our latest newsletter, we wrote an insights piece on transitional funding and how countries, and specifically the health of people living in these countries, are affected by the process. On March 15, the United Nations announced that four countries would soon graduate from the list of least developed countries (LCDs). The countries are Bhutan, Kiribati, the Solomon Islands and Sao Tome and Principe – a historic occasion since only five countries have graduated since the list’s creation in 1971.

LCDs are assessed based on three factors: health and education targets, economic vulnerability, and gross national income (GNI) per capita. The UN’s combination is more encompassing than those of the World Bank, GAVI and the Global Fund who rely solely on GNI to categorize countries and distribute funding accordingly.

Graduating from the LCD list can convey major improvements including increases in access to health and education for vulnerable populations such as rural women.

“However, the countries will need continued international support because they remain vulnerable to external shocks, including the impact of climate change” said Diane Elson, a member of the Committee for Development Policy.

While graduating from the UN LCD list doesn’t affect a country’s relationship with the UN, it may trigger reductions in other sources of social sector funding since it indicates a rise in GNI. Despite improvements, these four countries still struggle with inadequate health systems and other infrastructure and institutional challenges. Withdrawing needed funding too quickly can be catastrophic to their progress.

To read more about transitional funding and its implications, click here.

photo credit: World Bank