The year that started with the contraction in the economy due to liquidity crunch ended with liquidity surplus resulting mainly from low borrowing capacity of private sector that is certain to contract the economy further.
The low credit demand from the private sector will pull economic growth down, though the year witnessed a good harvest, one of the key propellers of the economic growth.
Apart from higher interest rates, private sector has been dogged by regular hours of power outage and industrial disturbances throughout 2011 pulling industrial growth down. According to Central Bureau of Statistics (CBS), Manufacturing Production Index grew by only 1.23 per cent in the first quarter (mid-July to mid-October). The change in government and policy instability also hit private sector hard, though, after the second half of the year, the country moved ahead with peace process and Constitution drafting. The pending issues of political settlement since last three years also forced the private sector to wait and watch.In absence of domestic investment, the foreign investment has also became a pipe dream.
Prime Minister Dr Baburam Bhattarai, has, however, tried to instill some confidence in investors by signing Bilateral Investment Promotion and Protection Agreement (BIPPA) and revised Double Taxation Avoidance Agreement (DTAA) with India, the largest trading partner. But the agreements will take time to bear fruits, as the security situation has not yet improved and the peace process has to get a logical conclusion. The low domestic demand pulled import down compared to last years but export has also not improved widening trade deficit to over Rs 332.97 billion.
The only respite the country got this year, is due to rising remittance that stood at Rs 78.5 billion by the third month of the current fiscal year due to increased outflow of Nepali migrant workers — also due to rising unemployment back home — and historic low Indian rupee that pulled Nepali rupees down. In the fourth month of current fiscal year, some 156,721 Nepalis have already left the country for foreign employment, according to Department of Foreign Employment.
The strong dollar against the weak Indian rupee helped Nepal receive more remittance giving a boost to the foreign exchange reserve that has swelled to over Rs 330 billion by the end of Mangsir, the fourth month of the current fiscal year.
The forex reserve also swelled due to rising tourist arrivals this year because of Nepal Tourism Year 2011 celebration that witnessed a record visitor arrivals crossing half-a-million mark by November. The positive current account and service account also helped Balance of Payment (BoP) to post Rs 33.86 billion surplus.
Timely budget could also be termed as an ‘achievement’ this year, also due to delayed budgets in last three successive years, that have hit the economic growth. But the timely budget could not boost the development expenditure that could boost employment and economic growth. Finance Minister Barsha Man Pun accepted that he is not satisfied with the development expenditure of Rs 5.29 billion, out of Rs 72.61 billion development budget, by the end of Mangsir (mid-November).
Similarly, the share market, — a mirror of economy — also remained bearish throughout the years due to lack of investors’ confidence on government’s policy and over flooding of shares compared to demand.
The non-economic factors like bandh and strikes also became regular headlines putting pressure on supply side ultimately rising price of essential goods. The inflation started looking up after the second half of the year as the government hiked prices of petroleum products that contribute 75 per cent to inflation, according to latest IMF research.
Rising petroleum prices coupled with power crisis made the economy more expensive and less competitive pulling the export down. The country witnessed an export of Rs 18.037 billion compared to Rs 100.26 billion worth imports by mid-October.
Though, Prime Minister Dr Bhattarai said that the country has started journey towards economic revolution, the overall annual trend defies his claim and the year will be registered in the history as yet another year of lost opportunity.
Saturday, December 31, 2011
Thursday, December 29, 2011
Former bankers arrested for misappropriating Rs 600 million
The Central Investigation Bureau (CIB) of Nepal Police on Thursday arrested two former bankers for misappropriating tens of millions of rupees deposited by the clients of the banks they worked for.
The bank fraudsters slipping into the CIB net are Shivaram Joshi (53) of Kathmandu and Shambhu Bahadur KC (53) of Kabhre, respectively. They were arrested from their separate hide-outs in the Capital and were on the run since the Nepal Rastra Bank implicated the duo as per the Banking Offences and Punishment Act.
DIG Upendra Kant Aryal, the CIB chief, said the central bank had pressed Joshi and KC with multiple fraud charges.
KC was the executive chairman of Nepal Progressive Finance while Joshi was the managing director of Capital Merchant Banking & Finance Ltd. Karki is also a son-in-law of KC.
"Joshi in collusion with KC has misused deposits to the tune of Rs 600 million by creating fake borrowers and siphoning off hefty sum in their respective organisations for easy monetary gain," he informed.
According to CIB, Joshi used to find fake borrowers and collect deposits from section office of Capital Merchant Rina Tandukar at the behest of its founding chief Pawan Kumar Karki and submit the sum to KC for his individual purpose like land procurement and operation of his office, Nepal Progressive Finance.
KC was also found to have bought around 307 ropani in various places of the Kathmandu Valley by misusing the bank deposits over years. CIB said the land fetches more than Rs 1.29 billion now. Karki is still at large.
Joshi and KC have been handed over to Metropolitan Police Range, Hanumandhoka to proceed with charge.Earlier in September, CIB had arrested former executive chairman of Nepal Share Market and Finance Yogendra Prasad Shrestha for embezzling Rs 2.66 billion, the biggest fraud in the banking history of Nepal.
The bank fraudsters slipping into the CIB net are Shivaram Joshi (53) of Kathmandu and Shambhu Bahadur KC (53) of Kabhre, respectively. They were arrested from their separate hide-outs in the Capital and were on the run since the Nepal Rastra Bank implicated the duo as per the Banking Offences and Punishment Act.
DIG Upendra Kant Aryal, the CIB chief, said the central bank had pressed Joshi and KC with multiple fraud charges.
KC was the executive chairman of Nepal Progressive Finance while Joshi was the managing director of Capital Merchant Banking & Finance Ltd. Karki is also a son-in-law of KC.
"Joshi in collusion with KC has misused deposits to the tune of Rs 600 million by creating fake borrowers and siphoning off hefty sum in their respective organisations for easy monetary gain," he informed.
According to CIB, Joshi used to find fake borrowers and collect deposits from section office of Capital Merchant Rina Tandukar at the behest of its founding chief Pawan Kumar Karki and submit the sum to KC for his individual purpose like land procurement and operation of his office, Nepal Progressive Finance.
KC was also found to have bought around 307 ropani in various places of the Kathmandu Valley by misusing the bank deposits over years. CIB said the land fetches more than Rs 1.29 billion now. Karki is still at large.
Joshi and KC have been handed over to Metropolitan Police Range, Hanumandhoka to proceed with charge.Earlier in September, CIB had arrested former executive chairman of Nepal Share Market and Finance Yogendra Prasad Shrestha for embezzling Rs 2.66 billion, the biggest fraud in the banking history of Nepal.
Investment Board gets full shape
A meeting of the Investment Board (IB) held today decided to nominate more members in the Board.
The meeting held at the Prime Minister´s Office decided to nominate entrepeuners and FNCCI vice president Bhawani Rana, former president Kush Kumar Joshi, Basanta Chaudhary and Krishna Acharya in the board representing private sector.
The meeting also appointed bankers Anil Shah and Chandra Dhakal as the permanent invitee members. Similarly, Minister for Energy, Minister for Physical Planning and Works and Minister for Information and Communications and Secretary at the Finance and Infrastructure Division of the PMO were also appointed as the permanent invitee members in the board.
The government had already appointed Radhesh Pant as a chief executive officer at the board.
The government has already declared fiscal year 2012-13 as the investment year in an attempt to increase investment in the country.
The meeting held at the Prime Minister´s Office decided to nominate entrepeuners and FNCCI vice president Bhawani Rana, former president Kush Kumar Joshi, Basanta Chaudhary and Krishna Acharya in the board representing private sector.
The meeting also appointed bankers Anil Shah and Chandra Dhakal as the permanent invitee members. Similarly, Minister for Energy, Minister for Physical Planning and Works and Minister for Information and Communications and Secretary at the Finance and Infrastructure Division of the PMO were also appointed as the permanent invitee members in the board.
The government had already appointed Radhesh Pant as a chief executive officer at the board.
The government has already declared fiscal year 2012-13 as the investment year in an attempt to increase investment in the country.
Tuesday, December 27, 2011
Microfinance institutions get registered on MIX Market
The joint UNCDF-UNDP project ‘Nepal Rastra Bank-Enhancing Access to Financial Services (NRB-EAFS) project has recently registered and uploaded information of all its partner microfinance institutions on MIX Market.
The major aim of the NRB-EASF project is to strengthen the capacity of microfinance institutions and enable them to reach 300,000 unbanked individuals. The project’s total budget is $3,000,000 funded 50 per cent each by UNDP and UNCDF. The project duration is from July 2008 to December 2012.
In this quarter, EAFS project also completed a rating activity of 10 Strategic Partners. The rating was conducted by M-CRIL - an international rating agency based in India.
EAFS’ strategic partners received positive ratings, the analysis however, highlighted some common issues facing all partnering institutions. All MFIs in Nepal for example, still rely on manual Management Information Systems (MIS) and while computerization is in progress this may take up to three years to come fully into place.
Another common challenge facing the Nepali microfinance industry consists in the similarity among loan, savings and insurance products offered by different MFIs, thus not creating healthy competition for the clients.
Moreover, M-CRIL’s rating found that most clients use only two general loans products, despite the availability of a broader range of products. This suggests that there is generally a lack of awareness among clients about products and services whereby they use only what they know about.
EASF will be incorporating the recommendation made by M-CRIL in future technical assistance interventions of the project.
The major aim of the NRB-EASF project is to strengthen the capacity of microfinance institutions and enable them to reach 300,000 unbanked individuals. The project’s total budget is $3,000,000 funded 50 per cent each by UNDP and UNCDF. The project duration is from July 2008 to December 2012.
In this quarter, EAFS project also completed a rating activity of 10 Strategic Partners. The rating was conducted by M-CRIL - an international rating agency based in India.
EAFS’ strategic partners received positive ratings, the analysis however, highlighted some common issues facing all partnering institutions. All MFIs in Nepal for example, still rely on manual Management Information Systems (MIS) and while computerization is in progress this may take up to three years to come fully into place.
Another common challenge facing the Nepali microfinance industry consists in the similarity among loan, savings and insurance products offered by different MFIs, thus not creating healthy competition for the clients.
Moreover, M-CRIL’s rating found that most clients use only two general loans products, despite the availability of a broader range of products. This suggests that there is generally a lack of awareness among clients about products and services whereby they use only what they know about.
EASF will be incorporating the recommendation made by M-CRIL in future technical assistance interventions of the project.
Sunday, December 25, 2011
Hotel Vaishali reopens after two weeks
Hotel Vaishali resumed its operation after two weeks days as management-workers disputes came to end with mutual agreement.
After the agreement, hotel management finally resumed its operation today. “We are pleased with the decision that reopen hotel after 20 days of closure,” said managing director of the hotel, Bishal Kumar. Workers who wanted to rejoin the work starts their service immediately after the agreement.
“We got a resignation letter from the three members of the agitating workers’ union,” informed Kumar. According to him,there were 85 hotel workers who were against the programme of the workers’ union.
The workers’ union at the hotel had disturbed daily operation and the hotel management had shutdown on December 8. Nabin Raut president of the worker’s union at Hotel Vaishali along with other two members that is Nabraj Khatiwada and Amrit Bhandari gave their resignation letter to the management.
“We have added Rs 500 from the allowance to the basic salary of the workers and have also agreed to provide bonus to them,” said Kumar. The hotel will take its bookings from December 26. The dispute between workers' union and management of Thamel-based Hotel Vaishali has started on December 5 in salary and benefits issues.
After the agreement, hotel management finally resumed its operation today. “We are pleased with the decision that reopen hotel after 20 days of closure,” said managing director of the hotel, Bishal Kumar. Workers who wanted to rejoin the work starts their service immediately after the agreement.
“We got a resignation letter from the three members of the agitating workers’ union,” informed Kumar. According to him,there were 85 hotel workers who were against the programme of the workers’ union.
The workers’ union at the hotel had disturbed daily operation and the hotel management had shutdown on December 8. Nabin Raut president of the worker’s union at Hotel Vaishali along with other two members that is Nabraj Khatiwada and Amrit Bhandari gave their resignation letter to the management.
“We have added Rs 500 from the allowance to the basic salary of the workers and have also agreed to provide bonus to them,” said Kumar. The hotel will take its bookings from December 26. The dispute between workers' union and management of Thamel-based Hotel Vaishali has started on December 5 in salary and benefits issues.
Friday, December 23, 2011
Nepal contracts Airbus Quovadis for RNP-AR navigation system
The Civil Aviation Authority of Nepal (CAAN) is to deploy the satellite-based Required Navigation Performance-Authorisation Required (RNP–AR) for air safety from February.
“We are working on the legal aspect and developing regulations for the implementation of RNP-AR at the Tribhuvan International Airport (TIA),” said deputy director general of the authority Dinesh Shrestha.
The authority has set the end of February for the launch of RNP–AR approaches. “The implementation of the system will support safety enhancement of aircraft, it will also fulfil the visibility requirement required by aircraft during bad weather and help reduce aircraft diverts,” said Shrestha, who is also the member of Nepal Performance Based Navigation implementation committee.
“The Instrumental Landing System is not feasible at the international airport, so we are introducing the system as an alternative to fulfil basic requirements for international flights,” said CAAN director general Ram Kumar Neupane.
The RNP–AR has a high safety margin as it can operate for six minutes after power-supply failure and disconnection from the satellite.
Pilots will have precise three-dimensional curved flight paths — one through congested airspace, another around noise sensitive areas and the third through difficult terrains.
Airbus flight services subsidiary Quovadis will assist instaling the system.
“We are working on the legal aspect and developing regulations for the implementation of RNP-AR at the Tribhuvan International Airport (TIA),” said deputy director general of the authority Dinesh Shrestha.
The authority has set the end of February for the launch of RNP–AR approaches. “The implementation of the system will support safety enhancement of aircraft, it will also fulfil the visibility requirement required by aircraft during bad weather and help reduce aircraft diverts,” said Shrestha, who is also the member of Nepal Performance Based Navigation implementation committee.
“The Instrumental Landing System is not feasible at the international airport, so we are introducing the system as an alternative to fulfil basic requirements for international flights,” said CAAN director general Ram Kumar Neupane.
The RNP–AR has a high safety margin as it can operate for six minutes after power-supply failure and disconnection from the satellite.
Pilots will have precise three-dimensional curved flight paths — one through congested airspace, another around noise sensitive areas and the third through difficult terrains.
Airbus flight services subsidiary Quovadis will assist instaling the system.
Thursday, December 22, 2011
Finance Minister paints rosy picture of economy
Finance Minister Barsha Man Pun, though, painted a rosy picture of the economy, though people have not got any respite from price hike; electricity tariff is increasing from January 15 and petroleum products prices are rising in a couple of days, making a deep hole in their pocket.
Neither the government has been able to create employment, nor has it been able to spend on development activities, but finance minister claimed that the economic indicators are positive and the country is sailing smoothly.
He, however, accepted that the government has not been able to crack whip on inflation and provide any 'visible relief' to the people, as promised.
The government is committed to give relief to the people, he reiterated, adding "but increasing electricity tariff and petroleum products prices was a compulsion.”
"The government has to take risk to save the country," Pun tried to justify. "There has been no hike in the electricity tariff and Nepal Electricity Authority (NEA) is incurring losses. Similarly, Nepal Oil Corporation (NOC) is also incurring huge losses forcing the government to hike the price. The government cannot always pump capital in NOC.”
The increasing hours of power outage has made the economy less competitive and the government is looking for solution to the power crisis and is soon deciding on either installing 100 MW Diesel Plant or increasing power import from India, he added.
But the rise in electricity tariff by 20 per cent and petroleum products will increase the cost of operation of industries, transportation and make goods dearer but people's purchasing power has not increased.
Pun showed his dissatisfaction over the low capital expenditure. "We have been able to spend Rs 5.29 billion on the development activities by the end of fifth month of the current fiscal year," he said, adding that it is, though 12 per cent increment compared to the last fiscal year, the development spending is 'too low'. The government has earmarked Rs 72.61 billion for development activities in the budget for the current fiscal year.
"The government has spent Rs 84.51 billion by the end of fifth month," he said, adding, "Of the total, Rs 71.91 billion has been spent on recurrent expenditure, spending on regular salaries and administrative activities."
The lower capital spending has resulted in lesser employment creation. Similarly, the government's ambitious plan to create employment to 50,000 youths in a year through Youth Self-Employment programme has also failed.
"The government has been able to help 1,800 youths in the last four years under the programme against the government's target of 50,000 in a year," Pun said, blaming the bureaucratic hurdles for the failure. "But we are having talks with the banks and financial institutions and youth wings of the political parties to make conducive environment to create more employment through risk free loan of Rs 200,000 under Youth Self-Employment programme that is expected to discourage search for greener pasture abroad by unemployed youths," he promised.
In the fourth month of current fiscal year, some 156,721 Nepalis have already landed in the Gulf and Malaysia for employment, according to the Department of Foreign Employment.
The programme was supposed to be scrapped according to the political consensus last month as it was criticised to be a party funding mechanism.But he said that the programme will be expanded through Federation of Nepalese Chambers of Commerce and Industry (FNCCI) district chapters and government banks, as they are also showing interest to participate in the programme actively. "The government banks have promised to help the programme by creating a separate desk to lend for youths, urban and rural," Pun said, adding that Agriculture Development Bank Ltd has asked for Rs 2 billion.
Neither the government has been able to create employment, nor has it been able to spend on development activities, but finance minister claimed that the economic indicators are positive and the country is sailing smoothly.
He, however, accepted that the government has not been able to crack whip on inflation and provide any 'visible relief' to the people, as promised.
The government is committed to give relief to the people, he reiterated, adding "but increasing electricity tariff and petroleum products prices was a compulsion.”
"The government has to take risk to save the country," Pun tried to justify. "There has been no hike in the electricity tariff and Nepal Electricity Authority (NEA) is incurring losses. Similarly, Nepal Oil Corporation (NOC) is also incurring huge losses forcing the government to hike the price. The government cannot always pump capital in NOC.”
The increasing hours of power outage has made the economy less competitive and the government is looking for solution to the power crisis and is soon deciding on either installing 100 MW Diesel Plant or increasing power import from India, he added.
But the rise in electricity tariff by 20 per cent and petroleum products will increase the cost of operation of industries, transportation and make goods dearer but people's purchasing power has not increased.
Pun showed his dissatisfaction over the low capital expenditure. "We have been able to spend Rs 5.29 billion on the development activities by the end of fifth month of the current fiscal year," he said, adding that it is, though 12 per cent increment compared to the last fiscal year, the development spending is 'too low'. The government has earmarked Rs 72.61 billion for development activities in the budget for the current fiscal year.
"The government has spent Rs 84.51 billion by the end of fifth month," he said, adding, "Of the total, Rs 71.91 billion has been spent on recurrent expenditure, spending on regular salaries and administrative activities."
The lower capital spending has resulted in lesser employment creation. Similarly, the government's ambitious plan to create employment to 50,000 youths in a year through Youth Self-Employment programme has also failed.
"The government has been able to help 1,800 youths in the last four years under the programme against the government's target of 50,000 in a year," Pun said, blaming the bureaucratic hurdles for the failure. "But we are having talks with the banks and financial institutions and youth wings of the political parties to make conducive environment to create more employment through risk free loan of Rs 200,000 under Youth Self-Employment programme that is expected to discourage search for greener pasture abroad by unemployed youths," he promised.
In the fourth month of current fiscal year, some 156,721 Nepalis have already landed in the Gulf and Malaysia for employment, according to the Department of Foreign Employment.
The programme was supposed to be scrapped according to the political consensus last month as it was criticised to be a party funding mechanism.But he said that the programme will be expanded through Federation of Nepalese Chambers of Commerce and Industry (FNCCI) district chapters and government banks, as they are also showing interest to participate in the programme actively. "The government banks have promised to help the programme by creating a separate desk to lend for youths, urban and rural," Pun said, adding that Agriculture Development Bank Ltd has asked for Rs 2 billion.
NRB relaxes institutional promoters shares’ ceiling
The institutional savers can now own large promoter stakes of more than one financial institution, the move that is expected to boost the share market.
The central bank has lifted the provision barring institutional savers from investing up to 15 per cent of paid up capital in more than one financial institutions and paved the way for Employees Provident Fund (EPF), Citizen Investment Trust (CIT) and Rastriya Beema Sansthan to buy more shares.
However, the regulation for not allowing a majority share holder of a financial institution to own more than one per cent stake in another financial institution is still intact for other promoters.
The only exception in the rule is the financial sector related companies that have 50 per cent or more stakes owned by Nepal government, according to the central bank.
For others that own up to 15 per cent promoter shares of paid up capital in one financial institution and have more than one per cent stake have to brought down the stakes within the end of this fiscal year.
"The regulation was supposed to curb multiple ownership of financial institutions by individuals and companies but it impeded institutional savers being involved in financial institutions," pointed out spokesperson of Nepal Rastra Bank (NRB) Bhaskar Mani Gyanwali.
The bulk investment by government owned institutional savers like the EPF and CIT in the share market was supposed to salvage the securities market from the dumps that it is in. However, NRB's regulation regarding ownership of the share that did not allow these institutions to aggressively invest in the stock market dominated by financial institutions earlier.
The central bank has but forbidden the executive board of banks and financial institutions to form any other committees except for audit committee, risk management committee and employee management and remuneration committee. The committees can be headed by the board members of the bank but chairman cannot be involved in any of the committees.
"The regulation will ensure proper corporate governance as the directors will be more involved in policy making and management in execution of policies instead of executives handling all the tasks," pointed out Gyanwali.
NRB has directed the financial institutions to determine the allowance for the committee members equal to the board members. The committees can have expert from outside as a member but the member should be between three to five in numbers.
The central bank has spelt out the roles and responsibilities of the three committees as well. The audit committee has to review and keep tab on the financial institution's internal accounts and condition and give instructions to the accounts department regarding required improvements.
Likewise, risk management committee will assess the internal and external risks and recommend measures to tackle them. The employee management and remuneration committee will look after human resource management issues of the financial institution.
The central bank has lifted the provision barring institutional savers from investing up to 15 per cent of paid up capital in more than one financial institutions and paved the way for Employees Provident Fund (EPF), Citizen Investment Trust (CIT) and Rastriya Beema Sansthan to buy more shares.
However, the regulation for not allowing a majority share holder of a financial institution to own more than one per cent stake in another financial institution is still intact for other promoters.
The only exception in the rule is the financial sector related companies that have 50 per cent or more stakes owned by Nepal government, according to the central bank.
For others that own up to 15 per cent promoter shares of paid up capital in one financial institution and have more than one per cent stake have to brought down the stakes within the end of this fiscal year.
"The regulation was supposed to curb multiple ownership of financial institutions by individuals and companies but it impeded institutional savers being involved in financial institutions," pointed out spokesperson of Nepal Rastra Bank (NRB) Bhaskar Mani Gyanwali.
The bulk investment by government owned institutional savers like the EPF and CIT in the share market was supposed to salvage the securities market from the dumps that it is in. However, NRB's regulation regarding ownership of the share that did not allow these institutions to aggressively invest in the stock market dominated by financial institutions earlier.
The central bank has but forbidden the executive board of banks and financial institutions to form any other committees except for audit committee, risk management committee and employee management and remuneration committee. The committees can be headed by the board members of the bank but chairman cannot be involved in any of the committees.
"The regulation will ensure proper corporate governance as the directors will be more involved in policy making and management in execution of policies instead of executives handling all the tasks," pointed out Gyanwali.
NRB has directed the financial institutions to determine the allowance for the committee members equal to the board members. The committees can have expert from outside as a member but the member should be between three to five in numbers.
The central bank has spelt out the roles and responsibilities of the three committees as well. The audit committee has to review and keep tab on the financial institution's internal accounts and condition and give instructions to the accounts department regarding required improvements.
Likewise, risk management committee will assess the internal and external risks and recommend measures to tackle them. The employee management and remuneration committee will look after human resource management issues of the financial institution.
EU gives additional support to 36 countries
The European Commission announced additional funding for projects targeting the most off-track Millennium Development Goals (MDGs) in 36 African, Caribbean and Pacific countries. The additional funding will focus on reducing hunger and child mortality and securing better maternal health and drinking water and sanitation facilities.
With today’s decision the EU is delivering on its one billion euros MDG initiative, announced in September 2010, at the UN MDGs Summit in New York. European commissioner for development, Andris Piebalgs said.The additional EU support will make a major contribution to the fight against poverty. “In line with our recent proposals for the future EU development policy, the ‘Agenda for Change’, we will invest our money where it is needed most and where we can achieve real results,” he said, adding that he is glad that one year after announcing the MDG initiative in New York, they are now ready to finance concrete projects on the ground. “Our goal is to do all we can to help developing countries meet the MDGs by 2015, a target to which we are still firmly committed. It remains an uphill struggle, but this is no time for a let up in our efforts.”Examples of actions to be financed under the MDG initiative include: ensuring better access to food for the poorest households in Haiti, providing milk to children in nurseries and primary schools in Rwanda, increasing the number of healthcare professionals in Ghana to reduce maternal mortality and improving access to save water in Samoa, mainly through rainwater harvesting and better sanitation facilities.
The MDG initiative focuses on those African, Caribbean and Pacific (ACP) countries that have designed projects of high quality to achieve results in the areas where progress is most needed: hunger, water and sanitation, maternal health and child mortality.
Today’s allocation amounts to 700 million euros. Project proposals have been identified in partnership with the respective countries and are fully results oriented: they put clear and measurable indicators in place to secure the benefits of the additional money.
The MDG initiative mobilises money from one of the EU’s main instruments of development aid, the 10 size European Development Fund (EDF). It envisages a total extra financial effort of one billion euros.
Regarding today’s allocation of 700 million pounds, the European Commission and the EU delegations, in coordination with EU member states representations and national authorities in the partner countries, will soon start working on the preparation of detailed project designs and specific financing proposals for all the actions to be supported by the MDG initiative, with a view to starting the implementation of most projects by the end of 2012. In parallel to today’s decision, approximately 300 million euros of the initiative are in the process of being allocated as a reward to 18 well-performing nations, in the framework of the 10 size EDF Mid-term Review. The UN Millennium Goals Report 2011 confirms that the world has made significant progress on some of the goals. By 2015, global poverty is currently expected to fall below 15 per cent, which is well below the target of 23 per cent.
With today’s decision the EU is delivering on its one billion euros MDG initiative, announced in September 2010, at the UN MDGs Summit in New York. European commissioner for development, Andris Piebalgs said.The additional EU support will make a major contribution to the fight against poverty. “In line with our recent proposals for the future EU development policy, the ‘Agenda for Change’, we will invest our money where it is needed most and where we can achieve real results,” he said, adding that he is glad that one year after announcing the MDG initiative in New York, they are now ready to finance concrete projects on the ground. “Our goal is to do all we can to help developing countries meet the MDGs by 2015, a target to which we are still firmly committed. It remains an uphill struggle, but this is no time for a let up in our efforts.”Examples of actions to be financed under the MDG initiative include: ensuring better access to food for the poorest households in Haiti, providing milk to children in nurseries and primary schools in Rwanda, increasing the number of healthcare professionals in Ghana to reduce maternal mortality and improving access to save water in Samoa, mainly through rainwater harvesting and better sanitation facilities.
The MDG initiative focuses on those African, Caribbean and Pacific (ACP) countries that have designed projects of high quality to achieve results in the areas where progress is most needed: hunger, water and sanitation, maternal health and child mortality.
Today’s allocation amounts to 700 million euros. Project proposals have been identified in partnership with the respective countries and are fully results oriented: they put clear and measurable indicators in place to secure the benefits of the additional money.
The MDG initiative mobilises money from one of the EU’s main instruments of development aid, the 10 size European Development Fund (EDF). It envisages a total extra financial effort of one billion euros.
Regarding today’s allocation of 700 million pounds, the European Commission and the EU delegations, in coordination with EU member states representations and national authorities in the partner countries, will soon start working on the preparation of detailed project designs and specific financing proposals for all the actions to be supported by the MDG initiative, with a view to starting the implementation of most projects by the end of 2012. In parallel to today’s decision, approximately 300 million euros of the initiative are in the process of being allocated as a reward to 18 well-performing nations, in the framework of the 10 size EDF Mid-term Review. The UN Millennium Goals Report 2011 confirms that the world has made significant progress on some of the goals. By 2015, global poverty is currently expected to fall below 15 per cent, which is well below the target of 23 per cent.
Government plans to rescue housing sector
The Finance Ministry has pointed out the price adjustment as a way out for the housing developers from the current dumps.
Talking to the media at his office today, finance minister Barsha Man Pun said that the government is planning to bring a rescue package to the housing, if the developers are ready to lower the price down.
"The price should come down and the government will think of helping them out of the current slump," he said, adding that the ministry is suggesting the residential builders to transform the apartments to apartment hotels as the tourist arrivals have seen an encouraging growth and the hotels have been unable to accommodate them.
Pun also assured that the government can buy some of the apartments, if the need arises and use it.
A study conducted by Nepal Rastra Bank (NRB) has revealed that the real estate is over priced by 30 per cent since last three years. Despite the cool down of the market from last one year the real estate price has not seen any adjustment. The central bank has also forwarded price revision as the solution for the relaters to stimulate the market.
The realtors have been pressurising the government and the central bank to come up with plan in order to salvage them from the bust. They have been demanding refinancing and restructuring facility from the central bank on the loans they have borrowed to construct the buildings. The sales of the housing and land units have gone down in recent times as the speculators in the realty have realised the asset price will not increase any time soon like it did during boom.
The contraction in demand has made the loan repayment for the development a difficult affair.Central bank governor Dr Yubaraj Khatiwada has also cautioned that with the burst of real estate bubble, the amount of Non Performing Assets (NPA) of the financial institutions will be going up in the near future.
"The financial institutions' loans to real estate will be going bad following their inability to pay back loans as asset price will not skyrocket once again like it had before," he said, warning that the financial institutions that have disregarded regulators' direction and lent more than 60 per cent of collateral valuation will be the one to get in trouble first.
Talking to the media at his office today, finance minister Barsha Man Pun said that the government is planning to bring a rescue package to the housing, if the developers are ready to lower the price down.
"The price should come down and the government will think of helping them out of the current slump," he said, adding that the ministry is suggesting the residential builders to transform the apartments to apartment hotels as the tourist arrivals have seen an encouraging growth and the hotels have been unable to accommodate them.
Pun also assured that the government can buy some of the apartments, if the need arises and use it.
A study conducted by Nepal Rastra Bank (NRB) has revealed that the real estate is over priced by 30 per cent since last three years. Despite the cool down of the market from last one year the real estate price has not seen any adjustment. The central bank has also forwarded price revision as the solution for the relaters to stimulate the market.
The realtors have been pressurising the government and the central bank to come up with plan in order to salvage them from the bust. They have been demanding refinancing and restructuring facility from the central bank on the loans they have borrowed to construct the buildings. The sales of the housing and land units have gone down in recent times as the speculators in the realty have realised the asset price will not increase any time soon like it did during boom.
The contraction in demand has made the loan repayment for the development a difficult affair.Central bank governor Dr Yubaraj Khatiwada has also cautioned that with the burst of real estate bubble, the amount of Non Performing Assets (NPA) of the financial institutions will be going up in the near future.
"The financial institutions' loans to real estate will be going bad following their inability to pay back loans as asset price will not skyrocket once again like it had before," he said, warning that the financial institutions that have disregarded regulators' direction and lent more than 60 per cent of collateral valuation will be the one to get in trouble first.
Wednesday, December 21, 2011
Metamorphosis of a Maoist ideologue
Three years ago, when he was finance minister in the Puspa Kamal Dahal 'Prachanda'-led government, he used to think share market as a gamble, though his own comrades have already invested in the market heavily taking advantage of open market economy.
But after three years, Dr Baburam Bhattarai as the fourth Prime Minister after the country is declared republic, has taken a 180 degree turn in his dogmatic communist economic view point of the share market and is serious on its continuous poor performance.
The Prime Minister requested the entrepreneurs last week during the dinner he has organised for the private sector at his official residence Baluwater, to come up with proposals to boost the confidence of investors as the share market has been continuously looking down. He not only showed serious concern on poor performance of share market but also vowed he is committed to the development of share market.
But it was too late to realise the importance of the capital market that is considered one of the best way of wealth creation and distribution. Had he understood that the share market is the mirror of economy three years ago, the situation could have been different.
Three years ago, when Bhattarai was the finance minister share market was really on the rally. It was hovering around 700 points, whereas today it is hovering around less than half at around 300 points. The down fall of the share market that started since his 'unpopular speech' terming the share market as gambling, has lost its confidence in the last three years.
At a time when the market is doing good, negative remarks from the government and its representatives would have immediate impact, but when the market is performing poorly, the positive remarks have lesser impact comparatively.
The share market's poor performance, at one point of time last year has even posed threat to the banks and financial institutions, though they are out of danger of margin type lending, currently. The exposure of banks and financial institutions on share market was not as huge as real estate but it was showing some signs of creating problem. The central bank tightened the margin type lending provisions to reverse it completely afterwards, which was of no use as by then the investors have already lost their confidence.
Bhattarai has come a long way round in three years to accept that capital market is a tool that can create and distribute wealth but it has become too late to correct it. Unless economy starts looking up and people have confidence on government and its policy consistency, it’s hard for the investors to believe him.
Prime Minister Dr Bhattarai even asked the business and corporate houses to list their businesses in the share market and help boost confidence. Obviously, many of the guests at his dinner did not take it seriously.
It’s not the first time the government has asked the corporate houses to list their business in the share market. Earlier governments, which were considered pro-market, had also urged them to list in the share market with lots of promises of incentives but they were never interested. And they will not be interested in Dr Bhattarai-led government, which is widely considered anti-market despite his recent pro-market promises and initiatives.
The Premier even asked what incentives would lure the business houses to list their businesses in the share market. But he either does not know or ignored why the listed companies of the same entrepreneurs have failed but not listed companies of the same entrepreneurs are still in operation.
What happened to the shareholders' money of those companies that were listed in the share market and are non-existent at present? More than three dozen companies vanished in the air in the last one decade and the share holders of those companies lost their hard earned money but the promoters of those companies have established new companies.
The UCPN-Maoist leaders themselves have conflicting views on economic policy keeping people guessing on what they are practicing and preaching.
The desperate Premier even asked the Finance Ministry to find loop holes on channeling investment without source, which is against the country's commitment to the Financial Action Task Force (FATF), to the share market. Currently, a transaction over Rs 1 million in a day comes under the Financial Information Unit scanner. He wants to raise the ceiling but could not as it is a commitment of the country to the international agency that looks after flow of dirty money.
Dr Bhattarai also forgot that Nepali investors are trend-based investors. And no one wants to lose their hard earned money by investing in poor performing market.
Similarly, the banks are offering more interest rates than the dividend yield of the shares forcing the investors deposit money in the banks and financial institutions rather than investing on shares. Despite the central bank's relaxation on margin type lending, the market did not respond as the return compared to the interest charged by the banks and financial institutions is still less.
The premier got enlightened at a wrong time, as after around the second quarter, when all the banks and finance companies that have all distributed dividends, the market slows down. His concern is appreciable, though investors have already lost heavily.
But after three years, Dr Baburam Bhattarai as the fourth Prime Minister after the country is declared republic, has taken a 180 degree turn in his dogmatic communist economic view point of the share market and is serious on its continuous poor performance.
The Prime Minister requested the entrepreneurs last week during the dinner he has organised for the private sector at his official residence Baluwater, to come up with proposals to boost the confidence of investors as the share market has been continuously looking down. He not only showed serious concern on poor performance of share market but also vowed he is committed to the development of share market.
But it was too late to realise the importance of the capital market that is considered one of the best way of wealth creation and distribution. Had he understood that the share market is the mirror of economy three years ago, the situation could have been different.
Three years ago, when Bhattarai was the finance minister share market was really on the rally. It was hovering around 700 points, whereas today it is hovering around less than half at around 300 points. The down fall of the share market that started since his 'unpopular speech' terming the share market as gambling, has lost its confidence in the last three years.
At a time when the market is doing good, negative remarks from the government and its representatives would have immediate impact, but when the market is performing poorly, the positive remarks have lesser impact comparatively.
The share market's poor performance, at one point of time last year has even posed threat to the banks and financial institutions, though they are out of danger of margin type lending, currently. The exposure of banks and financial institutions on share market was not as huge as real estate but it was showing some signs of creating problem. The central bank tightened the margin type lending provisions to reverse it completely afterwards, which was of no use as by then the investors have already lost their confidence.
Bhattarai has come a long way round in three years to accept that capital market is a tool that can create and distribute wealth but it has become too late to correct it. Unless economy starts looking up and people have confidence on government and its policy consistency, it’s hard for the investors to believe him.
Prime Minister Dr Bhattarai even asked the business and corporate houses to list their businesses in the share market and help boost confidence. Obviously, many of the guests at his dinner did not take it seriously.
It’s not the first time the government has asked the corporate houses to list their business in the share market. Earlier governments, which were considered pro-market, had also urged them to list in the share market with lots of promises of incentives but they were never interested. And they will not be interested in Dr Bhattarai-led government, which is widely considered anti-market despite his recent pro-market promises and initiatives.
The Premier even asked what incentives would lure the business houses to list their businesses in the share market. But he either does not know or ignored why the listed companies of the same entrepreneurs have failed but not listed companies of the same entrepreneurs are still in operation.
What happened to the shareholders' money of those companies that were listed in the share market and are non-existent at present? More than three dozen companies vanished in the air in the last one decade and the share holders of those companies lost their hard earned money but the promoters of those companies have established new companies.
The UCPN-Maoist leaders themselves have conflicting views on economic policy keeping people guessing on what they are practicing and preaching.
The desperate Premier even asked the Finance Ministry to find loop holes on channeling investment without source, which is against the country's commitment to the Financial Action Task Force (FATF), to the share market. Currently, a transaction over Rs 1 million in a day comes under the Financial Information Unit scanner. He wants to raise the ceiling but could not as it is a commitment of the country to the international agency that looks after flow of dirty money.
Dr Bhattarai also forgot that Nepali investors are trend-based investors. And no one wants to lose their hard earned money by investing in poor performing market.
Similarly, the banks are offering more interest rates than the dividend yield of the shares forcing the investors deposit money in the banks and financial institutions rather than investing on shares. Despite the central bank's relaxation on margin type lending, the market did not respond as the return compared to the interest charged by the banks and financial institutions is still less.
The premier got enlightened at a wrong time, as after around the second quarter, when all the banks and finance companies that have all distributed dividends, the market slows down. His concern is appreciable, though investors have already lost heavily.
Monday, December 19, 2011
Saudi prince invests $300m in Twitter
Saudi Prince Alwaleed bin Talal and his investment company agreed to buy a $300 million stake in Twitter.
The agreement to acquire a 'strategic stake' in Twitter followed 'several months of negotiations', Kingdom Holding said in a statement to the Saudi bourse reported by Bloomberg.
Alwaleed bin Talal visited Nepal last year and was planning to invest in Nepal too.
The company is controlled by Alwaleed, a nephew of Saudi Arabia's King Abdullah. Twitter last held a new round of funding in August, raising money from DST Global, along with several past investors.
The company aimed to raise about $800 million and was looking to use half the money to buy back shares from employees and earlier backers. The investment reportedly valued the messaging service at $8 billion.
Twitter confirmed the new investment in an e-mail but declined to give additional comments. Alwaleed is the biggest individual investor in Citigroup, and his other investments include stakes in GM, News Corp and Apple.
The agreement to acquire a 'strategic stake' in Twitter followed 'several months of negotiations', Kingdom Holding said in a statement to the Saudi bourse reported by Bloomberg.
Alwaleed bin Talal visited Nepal last year and was planning to invest in Nepal too.
The company is controlled by Alwaleed, a nephew of Saudi Arabia's King Abdullah. Twitter last held a new round of funding in August, raising money from DST Global, along with several past investors.
The company aimed to raise about $800 million and was looking to use half the money to buy back shares from employees and earlier backers. The investment reportedly valued the messaging service at $8 billion.
Twitter confirmed the new investment in an e-mail but declined to give additional comments. Alwaleed is the biggest individual investor in Citigroup, and his other investments include stakes in GM, News Corp and Apple.
Sunday, December 18, 2011
Country to lose billions due to bandh
The country is going to lose another couple of billions due to bandh.
A day of bandh costs the country Rs 1.98 billion, according to the figures of Livable Nepal, a campaign that advocates for economic freedom. "Even an hour of bandh will cost the country around Rs 83 million."
The criminalisation of politics and politicisation of criminal activities have cost the country dearly in the last one decade, according to economists, who opined that not a single political party, including Nepali Congress (NC), CPN-UML, UCPN-Maoist and Madesh-based parties are serious about the economy.
“We thought that the era of lawlessness has come to an end and the political parties are now serious on nation building but not a single party has learnt any lesson from their past mistakes," they said, without wanting to be named.
The country is in dire need of investment to create employment and fuel economic growth but apart from long hours of power outage and labour trouble that have made the economy more expensive and less competitive, the country is vulnerable to the huge loss due to lawlessness and high headedness of political parties that call nationwide strike crippling the economic activities.
Barring the economic activities and people's right to profession, no country can develop. According to Economic Freedom Report 2011, a country with economic freedom can have higher per-capita growth, whereas a country without economic freedom has the lowest growth.
"Nations with high economic freedom had an average growth in per-capita GDP between 1990 and 2009 of 3.07 per cent, compared to 1.18 per cent for those nations that have no economic freedom, in constant 2005 international dollars," it said, adding that safety of life and property, proper and effective implementation of rule of law and freedom to enterprise and participation in profession of one's own choice should be guarantee for the economic growth.
The successive governments have failed to guarantee economic freedom that could bring higher levels of prosperity, greater individual freedoms, and longer life spans.Increases in economic freedom decreases homicide and unemployment rates, whereas lower freedom increases criminal activities and unemployment.
Some 1,500 youths fly to Gulf and Malaysia in search for employment due to lack of employment at home.
One of the key employment generators, the industrial sector has been witnessing sluggish growth since last two fiscal years. The bandh also costs the sector Rs 386 million per day, according to the figure.
Reasons for bandh from January to August in 2011
Political — 59 per cent
Accident — 2 per cent
Association — 23 per cent
Padlocking/Protest — 12 per cent
Others — Four per cent
(Source: Livable Nepal)
A day of bandh costs the country Rs 1.98 billion, according to the figures of Livable Nepal, a campaign that advocates for economic freedom. "Even an hour of bandh will cost the country around Rs 83 million."
The criminalisation of politics and politicisation of criminal activities have cost the country dearly in the last one decade, according to economists, who opined that not a single political party, including Nepali Congress (NC), CPN-UML, UCPN-Maoist and Madesh-based parties are serious about the economy.
“We thought that the era of lawlessness has come to an end and the political parties are now serious on nation building but not a single party has learnt any lesson from their past mistakes," they said, without wanting to be named.
The country is in dire need of investment to create employment and fuel economic growth but apart from long hours of power outage and labour trouble that have made the economy more expensive and less competitive, the country is vulnerable to the huge loss due to lawlessness and high headedness of political parties that call nationwide strike crippling the economic activities.
Barring the economic activities and people's right to profession, no country can develop. According to Economic Freedom Report 2011, a country with economic freedom can have higher per-capita growth, whereas a country without economic freedom has the lowest growth.
"Nations with high economic freedom had an average growth in per-capita GDP between 1990 and 2009 of 3.07 per cent, compared to 1.18 per cent for those nations that have no economic freedom, in constant 2005 international dollars," it said, adding that safety of life and property, proper and effective implementation of rule of law and freedom to enterprise and participation in profession of one's own choice should be guarantee for the economic growth.
The successive governments have failed to guarantee economic freedom that could bring higher levels of prosperity, greater individual freedoms, and longer life spans.Increases in economic freedom decreases homicide and unemployment rates, whereas lower freedom increases criminal activities and unemployment.
Some 1,500 youths fly to Gulf and Malaysia in search for employment due to lack of employment at home.
One of the key employment generators, the industrial sector has been witnessing sluggish growth since last two fiscal years. The bandh also costs the sector Rs 386 million per day, according to the figure.
Reasons for bandh from January to August in 2011
Political — 59 per cent
Accident — 2 per cent
Association — 23 per cent
Padlocking/Protest — 12 per cent
Others — Four per cent
(Source: Livable Nepal)
Hotel Vaishali closes, finally
Due to continuous disturbance of workers’ union in the Hotel Vaishali, the management finally has decided to close the hotel but it has not yet notified Department of Industry.
However, Hotel Association Nepal (HAN) releasing a press statement has supported the management's decision to close the hotel. The trade union at the hotel started its protest programme over salary adjustment since the first week of December. According to the workers’ union, the management overlooked the demand compelling them to start the protest programme.
However the association releasing a press statement supported the complete shutdown of the hotel from December 17. The association also condemned the activities of the workers.
It has also mentioned that the hotel management has followed the minimum wage policy fixed by the government but the union created an aggressive environment at the hotel that compelled the management to shift their guest to other hotels.
The workers’ also manhandled the managers and threatened other workers, the HAN said, adding that the hotel was bearing a loss of about Rs 1.3 million, which is only through the hotel room accommodation. "It was also bearing loss in its other services."
However, according to the union, the association is bias. The union has demanded increment in their salary according to the minimum wage of the government that is Rs 1,600 increment on the monthly allowance and basic salary dividing Rs 1,100 in monthly allowance and Rs 500 in basic salary. The hotel that employed 100 staffs offered Rs 3,500 in allowance and Rs 4,600 in its basic salary.
However, Hotel Association Nepal (HAN) releasing a press statement has supported the management's decision to close the hotel. The trade union at the hotel started its protest programme over salary adjustment since the first week of December. According to the workers’ union, the management overlooked the demand compelling them to start the protest programme.
However the association releasing a press statement supported the complete shutdown of the hotel from December 17. The association also condemned the activities of the workers.
It has also mentioned that the hotel management has followed the minimum wage policy fixed by the government but the union created an aggressive environment at the hotel that compelled the management to shift their guest to other hotels.
The workers’ also manhandled the managers and threatened other workers, the HAN said, adding that the hotel was bearing a loss of about Rs 1.3 million, which is only through the hotel room accommodation. "It was also bearing loss in its other services."
However, according to the union, the association is bias. The union has demanded increment in their salary according to the minimum wage of the government that is Rs 1,600 increment on the monthly allowance and basic salary dividing Rs 1,100 in monthly allowance and Rs 500 in basic salary. The hotel that employed 100 staffs offered Rs 3,500 in allowance and Rs 4,600 in its basic salary.
Saturday, December 17, 2011
IMM lures foreign, domestic tourists alike
International Mountain Museum (IMM) has become one of the most popular destinations for the tourists and locals in the lake city of Pokhara.
"Since its establishment eight years ago, the museum has seen about 667,019 visitors, including domestic and foreigners," the chief of International Mountain Museum Bal Prasad Rai said, adding that the museum has also been able to generate revenue of Rs 43.5 million since its operations.
Of the total visitors, the students frequent the museum the most as some 342,185 students have visited IMM generating revenue of Rs 8.1 million, Rai, who is also a museologist, said.
Domestic tourists come second in terms of number of museum goers with 178,389 Nepalis have entered the museum, according to the records.However, foreign tourists are the largest contributor — despite relatively smaller footfalls — in terms of revenue. The revenue generated from the foreigners amount to Rs 22.8 million.
The IMM is a tribute to mountains and mountaineers as an effort to preserve the history of the mountain climbing expeditions in Nepal by Nepal Mountaineering Association (NMA).
The construction of the museum that was opened for visitors since February 2004 construction began in 1996. It covers an area of 4,242-sq metres. The museum offers the geography, ecology, and culture of the Himalayas exhibiting the history of mountaineering.
The museum is divided into five halls showcasing the Himalaya, hall of international mountains, hall of expeditions, hall of fame and exhibition hall. It also houses library to facilitate research."A full time senior JICA volunteer helps with the day to day operation of the museum," he added.
Of its five main galleries, the Gallery of the Mountain People of the World showcases the articles of the mountain people that represent their culture, like their dresses, ornaments and implements used in their daily life. The gallery exhibits geological information of the world mountain system including their origin and mountain habitat.
The Hall of the Himalayas displays the notable peaks in the Himalayan range along with its rich flora and fauna. It also houses the multi-ethnic diversity and their occupations in the region. The Hall of Internal Mountains displays the Nepal's mountain ranges and peaks in addition to the cultural diversity of tribes residing in the mountain regions.
Likewise, Hall of Fame displays the feats of great mountaineers, memorable events associated with them and famous explorers, research and discoveries.
Likewise, the Hall of Expeditions displays the history of mountaineering, types of equipment used, development of mountaineering techniques, and famous expeditions in the Himalayas.
One of the key attractions of the museum is the model of Mt Manaslu that stands 31 feet from the ground. The museum now houses research and conference halls as well as a 21 metres tall artificial climbing wall in its premises. It is an attempt at recording and documenting natural history and culture of the Himalayas as well as all the mountains of the world.
"Since its establishment eight years ago, the museum has seen about 667,019 visitors, including domestic and foreigners," the chief of International Mountain Museum Bal Prasad Rai said, adding that the museum has also been able to generate revenue of Rs 43.5 million since its operations.
Of the total visitors, the students frequent the museum the most as some 342,185 students have visited IMM generating revenue of Rs 8.1 million, Rai, who is also a museologist, said.
Domestic tourists come second in terms of number of museum goers with 178,389 Nepalis have entered the museum, according to the records.However, foreign tourists are the largest contributor — despite relatively smaller footfalls — in terms of revenue. The revenue generated from the foreigners amount to Rs 22.8 million.
The IMM is a tribute to mountains and mountaineers as an effort to preserve the history of the mountain climbing expeditions in Nepal by Nepal Mountaineering Association (NMA).
The construction of the museum that was opened for visitors since February 2004 construction began in 1996. It covers an area of 4,242-sq metres. The museum offers the geography, ecology, and culture of the Himalayas exhibiting the history of mountaineering.
The museum is divided into five halls showcasing the Himalaya, hall of international mountains, hall of expeditions, hall of fame and exhibition hall. It also houses library to facilitate research."A full time senior JICA volunteer helps with the day to day operation of the museum," he added.
Of its five main galleries, the Gallery of the Mountain People of the World showcases the articles of the mountain people that represent their culture, like their dresses, ornaments and implements used in their daily life. The gallery exhibits geological information of the world mountain system including their origin and mountain habitat.
The Hall of the Himalayas displays the notable peaks in the Himalayan range along with its rich flora and fauna. It also houses the multi-ethnic diversity and their occupations in the region. The Hall of Internal Mountains displays the Nepal's mountain ranges and peaks in addition to the cultural diversity of tribes residing in the mountain regions.
Likewise, Hall of Fame displays the feats of great mountaineers, memorable events associated with them and famous explorers, research and discoveries.
Likewise, the Hall of Expeditions displays the history of mountaineering, types of equipment used, development of mountaineering techniques, and famous expeditions in the Himalayas.
One of the key attractions of the museum is the model of Mt Manaslu that stands 31 feet from the ground. The museum now houses research and conference halls as well as a 21 metres tall artificial climbing wall in its premises. It is an attempt at recording and documenting natural history and culture of the Himalayas as well as all the mountains of the world.
Friday, December 16, 2011
Accessibility to energy helps reduce poverty
Nawalparasi village gets first Wind-Solar hybrid renewal energy project in Asia
Improving energy accessibility helps reducing poverty, according to the experts."The pilot project that has been operational in Nepal from today will be replicated in five other countries," said director general of the Asian Development Bank (ADB) Sultan Hafeez Rahman, during the wind-solar hybrid power inauguration here today.
Minister for Environment today inaugurated the 5kw-wind-solar hybrid power system in Dhaubadi of Nawalparasi, the first wind-solar hybrid power in Asia. “Some other VDCs are also under study for the new technology," Rahman said, adding that modern energy has the power to transform lives and communities, often in unexpected ways.
The wind-solar hybrid system was installed under ADB’s regional technical assistance (RETA) for Effective Development of Distributed Small Wind Power Systems in Asian Rural Areas for which the Alternative Energy Promotion Centre (AEPC) of Ministry of Environment is the implementing agency. The $3.8 million RETA will contribute to ADB’s 'Energy For All' initiative by increasing access to energy in remote rural areas that is expected to help reduce poverty."Energy fuels economic growth and poverty reduction," he said, "reliable and efficient energy services underpin the expansion of economic and employment opportunities, the continuing progress in social development, and the sustained improvement in standards of living.
"The project is based on ‘energy systems’ planning approach and has installed two sets of 5 kW wind turbines complimented by 2 kWp of solar PV panels to satisfy the village’s electricity demand of 43.6 KWh per day. It has also provided solar cookers, solar dryers and biogas systems to the villagers for extra income generation. Erecting greenhouses to absorb solar energy and manage water uses for high-value cash crop and vegetable production is also being planned which will augment income generation activities of the village community.
"Nepal’s chronic energy shortage, its abundant wind and solar resources, and most importantly the strong government commitment toward a low-carbon economy led ADB to select Nepal as the first pilot country for ADB’s small wind power initiative," ADB’s senior investment specialist Kangbin Zheng said, adding that the lessons learned in Nepal on the deployment of small wind power systems in rural areas will be very useful in scaling up the systems in Nepal and replicating in other ADB member countries.
"Nepal has more potential in the clean energy and the government is committed to develop and promote it, secretary at the Ministry of Environment Krishna Gyawali said.
The government is planning to update Rural Energy Policy making it more effective including the renewal energy, he said, adding that the Bill has been approved by the cabinet and soon the parliament will give its nod to make it an Act.
Improving energy accessibility helps reducing poverty, according to the experts."The pilot project that has been operational in Nepal from today will be replicated in five other countries," said director general of the Asian Development Bank (ADB) Sultan Hafeez Rahman, during the wind-solar hybrid power inauguration here today.
Minister for Environment today inaugurated the 5kw-wind-solar hybrid power system in Dhaubadi of Nawalparasi, the first wind-solar hybrid power in Asia. “Some other VDCs are also under study for the new technology," Rahman said, adding that modern energy has the power to transform lives and communities, often in unexpected ways.
The wind-solar hybrid system was installed under ADB’s regional technical assistance (RETA) for Effective Development of Distributed Small Wind Power Systems in Asian Rural Areas for which the Alternative Energy Promotion Centre (AEPC) of Ministry of Environment is the implementing agency. The $3.8 million RETA will contribute to ADB’s 'Energy For All' initiative by increasing access to energy in remote rural areas that is expected to help reduce poverty."Energy fuels economic growth and poverty reduction," he said, "reliable and efficient energy services underpin the expansion of economic and employment opportunities, the continuing progress in social development, and the sustained improvement in standards of living.
"The project is based on ‘energy systems’ planning approach and has installed two sets of 5 kW wind turbines complimented by 2 kWp of solar PV panels to satisfy the village’s electricity demand of 43.6 KWh per day. It has also provided solar cookers, solar dryers and biogas systems to the villagers for extra income generation. Erecting greenhouses to absorb solar energy and manage water uses for high-value cash crop and vegetable production is also being planned which will augment income generation activities of the village community.
"Nepal’s chronic energy shortage, its abundant wind and solar resources, and most importantly the strong government commitment toward a low-carbon economy led ADB to select Nepal as the first pilot country for ADB’s small wind power initiative," ADB’s senior investment specialist Kangbin Zheng said, adding that the lessons learned in Nepal on the deployment of small wind power systems in rural areas will be very useful in scaling up the systems in Nepal and replicating in other ADB member countries.
"Nepal has more potential in the clean energy and the government is committed to develop and promote it, secretary at the Ministry of Environment Krishna Gyawali said.
The government is planning to update Rural Energy Policy making it more effective including the renewal energy, he said, adding that the Bill has been approved by the cabinet and soon the parliament will give its nod to make it an Act.
EU provides Rs 400.8m to promote agriculture, nutrition
The European Union (EU) funded 'Agriculture and Nutrition Extension (ANE) project launched on Friday aims at improving the food security and nutrition of 20,000 households identified as the poorest and vulnerable in Nawalparasi, Rupandehi, Rukum and Surkhet districts of Nepal including 40,000 additional households in the Barisal district of Bangladesh.
International Development Enterprises Nepal (IDE-Nepal) has joined hands with seven other partners — CIMMYT, WorldFish, IRRI, Save The Children, CEAPRED, BES and CODEC to run the project. IDE successfully submitted the ANE project proposal as part of a global competitive call. The EU has provided an assistance of Euro3,644,677 (approx Rs 400.8 million) for the three-year project.
The decision to support the project comes in the wake of the successful completion of the European Union Food Facility Project (EUFF), which was implemented in eighteen districts of mid and far western Nepal through a total contribution of Euro23.5 million. Several partners of the newly launched initiative had been mobilised under the Food Facility to carry out similar activities in Humla, Mugu, Rukum, Rokpa and Banke districts from January 2010 to October 2011.
The project will work in two terai districts of Rupandehi and Nawalparsi selected because they are part of a technology development hub being implemented by the International Centres and NARC and two hill districts Rukum and Surkhet were selected for their suitability for a programme to develop exports and linkages for vegetable seeds between Nepal to Bangladesh.
One of the major goals of the project is to develop market linkages between rural and urban areas and promote exchange of expertise and technologies between agricultural and research institutions in Nepal and Bangladesh, both at the national and grassroots levels.
The project activities seek to disseminate training on new and emerging agricultural technologies to farmers helping them to step up productivity and increase their annual incomes. The project will expose them to new agriculture technologies based on market development approaches and the Participatory Market Chain Approach (PMCA). The training component has also encompassed public and private institutions.
The project also aims at conducting nutrition education, monitoring and counselling for the poor, rural and urban households for increasing the consumption of nutritious foods.
Women and children in both countries, who have been facing nutritional problems, will be made the target beneficiaries of the project. The project seeks to help 60,000 households to increase their annual income by at least 75 Euros from production and sales of high- value agricultural commodities. Similarly, 1000 households are expected to increase their annual income by Euro100 from seed sales.
Overall, the project seeks to help 60,000 poor and excluded household – 40,000 in Bangladesh and 20,000 in Nepal – to increase their income and nutritional status.
International Development Enterprises Nepal (IDE-Nepal) has joined hands with seven other partners — CIMMYT, WorldFish, IRRI, Save The Children, CEAPRED, BES and CODEC to run the project. IDE successfully submitted the ANE project proposal as part of a global competitive call. The EU has provided an assistance of Euro3,644,677 (approx Rs 400.8 million) for the three-year project.
The decision to support the project comes in the wake of the successful completion of the European Union Food Facility Project (EUFF), which was implemented in eighteen districts of mid and far western Nepal through a total contribution of Euro23.5 million. Several partners of the newly launched initiative had been mobilised under the Food Facility to carry out similar activities in Humla, Mugu, Rukum, Rokpa and Banke districts from January 2010 to October 2011.
The project will work in two terai districts of Rupandehi and Nawalparsi selected because they are part of a technology development hub being implemented by the International Centres and NARC and two hill districts Rukum and Surkhet were selected for their suitability for a programme to develop exports and linkages for vegetable seeds between Nepal to Bangladesh.
One of the major goals of the project is to develop market linkages between rural and urban areas and promote exchange of expertise and technologies between agricultural and research institutions in Nepal and Bangladesh, both at the national and grassroots levels.
The project activities seek to disseminate training on new and emerging agricultural technologies to farmers helping them to step up productivity and increase their annual incomes. The project will expose them to new agriculture technologies based on market development approaches and the Participatory Market Chain Approach (PMCA). The training component has also encompassed public and private institutions.
The project also aims at conducting nutrition education, monitoring and counselling for the poor, rural and urban households for increasing the consumption of nutritious foods.
Women and children in both countries, who have been facing nutritional problems, will be made the target beneficiaries of the project. The project seeks to help 60,000 households to increase their annual income by at least 75 Euros from production and sales of high- value agricultural commodities. Similarly, 1000 households are expected to increase their annual income by Euro100 from seed sales.
Overall, the project seeks to help 60,000 poor and excluded household – 40,000 in Bangladesh and 20,000 in Nepal – to increase their income and nutritional status.
Nepal selected for MCC programme
The Millennium Challenge Corporation (MCC) in Washington DC, yesterday announced that Nepal has been selected as eligible to develop a Threshold Programme due to recent landmark agreements on the Comprehensive Peace Accord.
“We welcome the MCC’s decision, which recognises the progress that Nepal has made to advance peace and increase prosperity for its people. We look forward to Nepal’s leadership in working with MCC and the Embassy in designing a threshold programme that will continue to advance the government’s efforts to create a democratic state focused on meeting the needs of the citizens of Nepal,” said the MCC that is an independent US foreign aid agency helping in leading the fight against global poverty.
Created by Congress in 2004, MCC looks at new ways to deliver smart US foreign assistance by forming partnerships with countries committed to good governance, economic freedom, and investments in their citizens. Qualifying for MCC assistance is a competitive process in which a country’s performance on 17 different policy indicators is carefully assessed. MCC grants complement other US and international development programmes.
“We are delighted that the MCC determined Nepal’s performance in these policy areas merited recognition with eligibility for a Threshold Programme,” according to the US embassy in Kathmandu.
“We welcome the MCC’s decision, which recognises the progress that Nepal has made to advance peace and increase prosperity for its people. We look forward to Nepal’s leadership in working with MCC and the Embassy in designing a threshold programme that will continue to advance the government’s efforts to create a democratic state focused on meeting the needs of the citizens of Nepal,” said the MCC that is an independent US foreign aid agency helping in leading the fight against global poverty.
Created by Congress in 2004, MCC looks at new ways to deliver smart US foreign assistance by forming partnerships with countries committed to good governance, economic freedom, and investments in their citizens. Qualifying for MCC assistance is a competitive process in which a country’s performance on 17 different policy indicators is carefully assessed. MCC grants complement other US and international development programmes.
“We are delighted that the MCC determined Nepal’s performance in these policy areas merited recognition with eligibility for a Threshold Programme,” according to the US embassy in Kathmandu.
Thursday, December 15, 2011
Nepal lost between $5.92 billion and $6.04 billion in last one decade
Nepal lost between $5.92 billion and $6.04 billion over the last one decade due to illicit financial outflows, according to a study by Global Financial Integrity (GFI) published today.
Rather than the discrepancy in Balance of Payments (BoP) like unrecorded leakages, trade mispricing is the primary contributor to illicit financial outflows from Nepal. Between 2000 and 2009, approximately 82 per cent of the total illicit financial outflows from Nepal was only due to trade mispricing. The same figure for developing countries over the period stands at 53.9 per cent.
"Bribery, proceeds of corruption, and trade mispricing cost Nepal dearly," the GFI said, adding that of the total, only trade mispricing — export over-invoicing, import under-invoicing, fake VAT bill and misappropriation of IC — cost $4.940 billion to the nation over 2000-2009, an average of $494 million each year.
The study tracks the amount of illegal capital flowing out of 157 different developing countries over the 10-year period from 2000 through 2009, and ranks the countries by the magnitude of illicit outflows.
The report should be a wake-up call to the government that more must have to be done to address the capital outflows and will help it tighten screw on tax evaders, traders, and corrupt leaders and businessmen.
Nepal is also ranked sixth among the 48 LDCs having the largest cumulative illicit financial flows. With a total of $35 billion, Bangladesh is at the top of the list. The total illicit flow for Nepal is estimated to be $9.128 billion. Moreover, it is on rise.
The report revealed that from 2000 to 2008, estimated total illicit financial flows for Nepal between $563 million and $566 million per year. But according to UNDP estimates, between 1990 and 2008, Nepal lost $419 million to $480 million per year in illicit ouflow.
Global Financial Integrity (GFI) — a Washington, DC-based research and advocacy organisation that promotes transparency in the international financial system — said that capital outflows stem from crime, corruption, tax evasion, and other illicit activity.
The report also suggested to curtail trade mispricing, require country-by-country reporting of sales, profits and taxes paid by multinational corporations, require confirmation of beneficial ownership in all banking and securities accounts, require automatic cross-border exchange of tax information on personal and business accounts, and harmonise predicate offenses under anti-money laundering laws across all Financial Action Task Force (FATF) cooperating countries.
Developing countries lost $903 billion in illicit financial outflows in 2009 despite the massive slowdown in economic activity which rocked world markets in late 2008.
The report 'Illicit Financial Flows from Developing Countries over the Decade Ending 2009,' which estimated the developing world lost $8.44 trillion over the decade ending in 2009, is GFI’s annual update on the amount of money flowing out of developing economies via crime, corruption and tax evasion.
According to the report, the five biggest victims of illicit financial flows over the decade are China ($2.74 trillion), Mexico ($504 billion), Russia ($501 billion), Saudi Arabia ($380 billion) and Malaysia ($350 billion).
The report also revealed the top victims of illegal capital flight in 2009. The top five countries suffering the highest illicit outflows in 2009 include China ($291 billion), Saudi Arabia ($82.3 billion), Poland ($66.3 billion), Malaysia ($46.8 billion and Mexico ($34.6 billion).
Rather than the discrepancy in Balance of Payments (BoP) like unrecorded leakages, trade mispricing is the primary contributor to illicit financial outflows from Nepal. Between 2000 and 2009, approximately 82 per cent of the total illicit financial outflows from Nepal was only due to trade mispricing. The same figure for developing countries over the period stands at 53.9 per cent.
"Bribery, proceeds of corruption, and trade mispricing cost Nepal dearly," the GFI said, adding that of the total, only trade mispricing — export over-invoicing, import under-invoicing, fake VAT bill and misappropriation of IC — cost $4.940 billion to the nation over 2000-2009, an average of $494 million each year.
The study tracks the amount of illegal capital flowing out of 157 different developing countries over the 10-year period from 2000 through 2009, and ranks the countries by the magnitude of illicit outflows.
The report should be a wake-up call to the government that more must have to be done to address the capital outflows and will help it tighten screw on tax evaders, traders, and corrupt leaders and businessmen.
Nepal is also ranked sixth among the 48 LDCs having the largest cumulative illicit financial flows. With a total of $35 billion, Bangladesh is at the top of the list. The total illicit flow for Nepal is estimated to be $9.128 billion. Moreover, it is on rise.
The report revealed that from 2000 to 2008, estimated total illicit financial flows for Nepal between $563 million and $566 million per year. But according to UNDP estimates, between 1990 and 2008, Nepal lost $419 million to $480 million per year in illicit ouflow.
Global Financial Integrity (GFI) — a Washington, DC-based research and advocacy organisation that promotes transparency in the international financial system — said that capital outflows stem from crime, corruption, tax evasion, and other illicit activity.
The report also suggested to curtail trade mispricing, require country-by-country reporting of sales, profits and taxes paid by multinational corporations, require confirmation of beneficial ownership in all banking and securities accounts, require automatic cross-border exchange of tax information on personal and business accounts, and harmonise predicate offenses under anti-money laundering laws across all Financial Action Task Force (FATF) cooperating countries.
Developing countries lost $903 billion in illicit financial outflows in 2009 despite the massive slowdown in economic activity which rocked world markets in late 2008.
The report 'Illicit Financial Flows from Developing Countries over the Decade Ending 2009,' which estimated the developing world lost $8.44 trillion over the decade ending in 2009, is GFI’s annual update on the amount of money flowing out of developing economies via crime, corruption and tax evasion.
According to the report, the five biggest victims of illicit financial flows over the decade are China ($2.74 trillion), Mexico ($504 billion), Russia ($501 billion), Saudi Arabia ($380 billion) and Malaysia ($350 billion).
The report also revealed the top victims of illegal capital flight in 2009. The top five countries suffering the highest illicit outflows in 2009 include China ($291 billion), Saudi Arabia ($82.3 billion), Poland ($66.3 billion), Malaysia ($46.8 billion and Mexico ($34.6 billion).
Corruption makes economy more expensive, less competitive
Corruption is making economy more expensive and less competitive, according to a former bureaucrat.
"Public procurement, public post 'auction', revenue cheating and policy level corruption hurt the economy making it expensive, whereas petty corruption and rent seeking mentality help create public perception about the corruption and government employee," said former finance secretary and economic advisor to the Prime Minister Ramehswor Prasad Khanal presenting his paper on 'Anti corruption and Good Governance: Challenges from Bureaucratical Dimension,' in an interaction on 'Good Governance — Zero Tolerance to Corruption' organised by Federation of Nepalese Chambers of Commerce and Industry (FNCCI) here in the Valley today.
"Petty corruption and rent seeking mentality create negative image of government employee but it doesnot hurt economy," he said, adding that public procurement, public post 'auction', and revenue cheating, however, hurt economy making the economy less competitive.
Similarly, corruption fuells black markets too. The world's shadow economy or the illegal economic activities, that go untaxed, accounts for 17 per cent of the global economy. Nepal's shadow economy is as big as formal economy that is not only bleeding the government coffer white, "but also channelising resources to the unproductive sectors widening the gap between the rich and poor," he added.
Khanal also tried to demystified the popular myths on corruption like all the government employees are corrupt and corruption is rising due to low pay scale. "The most corrupt are the ones, who are wealthy," former bureaucrat added. "Similarly, corruption is rampant in the private sector too but the people blame government employees only due to their popular perception."
Corruption is multi-pronged and due to massive corruption, Nepal is still in the group of Least Developed Countries (LDCs), whereas the ones in the same group with Nepal some three decades ago have upgraded, Khanal said, adding "Apart from strong political will, some simplification in processes, usages of IT and transparency will help check the corruption."He also prescribed to give more teeth to the CIAA Act and include provision to punish both bribe taking and giving parties to curtail corruption.
Chief secretary Madhav Prasad Ghimire concluding the two-day workshop urged the private sector to join hands in checking corruption.
"Institutional corruption is much more dangerous than individual corruption and making political parties more transparent could help reduce institutional corruption," he said, adding that the election system also has to be changed to encourage honest leaders.
"Public procurement, public post 'auction', revenue cheating and policy level corruption hurt the economy making it expensive, whereas petty corruption and rent seeking mentality help create public perception about the corruption and government employee," said former finance secretary and economic advisor to the Prime Minister Ramehswor Prasad Khanal presenting his paper on 'Anti corruption and Good Governance: Challenges from Bureaucratical Dimension,' in an interaction on 'Good Governance — Zero Tolerance to Corruption' organised by Federation of Nepalese Chambers of Commerce and Industry (FNCCI) here in the Valley today.
"Petty corruption and rent seeking mentality create negative image of government employee but it doesnot hurt economy," he said, adding that public procurement, public post 'auction', and revenue cheating, however, hurt economy making the economy less competitive.
Similarly, corruption fuells black markets too. The world's shadow economy or the illegal economic activities, that go untaxed, accounts for 17 per cent of the global economy. Nepal's shadow economy is as big as formal economy that is not only bleeding the government coffer white, "but also channelising resources to the unproductive sectors widening the gap between the rich and poor," he added.
Khanal also tried to demystified the popular myths on corruption like all the government employees are corrupt and corruption is rising due to low pay scale. "The most corrupt are the ones, who are wealthy," former bureaucrat added. "Similarly, corruption is rampant in the private sector too but the people blame government employees only due to their popular perception."
Corruption is multi-pronged and due to massive corruption, Nepal is still in the group of Least Developed Countries (LDCs), whereas the ones in the same group with Nepal some three decades ago have upgraded, Khanal said, adding "Apart from strong political will, some simplification in processes, usages of IT and transparency will help check the corruption."He also prescribed to give more teeth to the CIAA Act and include provision to punish both bribe taking and giving parties to curtail corruption.
Chief secretary Madhav Prasad Ghimire concluding the two-day workshop urged the private sector to join hands in checking corruption.
"Institutional corruption is much more dangerous than individual corruption and making political parties more transparent could help reduce institutional corruption," he said, adding that the election system also has to be changed to encourage honest leaders.
Wednesday, December 14, 2011
Revenue mobilisation slows down
The government may fail to meet revenue mobilisation target for the current fiscal year, if the current rate of revenue mobilisation continues.
The government has been able to mobilise Rs 60 billion revenue in the first four months of the current fiscal year, which is 17 per cent increment compared to the same period last fiscal year," according to the Finance Ministry that held the evaluation meeting today.
In the meeting attended by finance secretary, department heads and office chives of the Valley tax offices, the Department of Inland Revenue however claimed that the target will be met as by the third week of the fifth month (Mangsir), it has been able to mobilise Rs 70.33 billion.
The registration tax, vehicle tax and non-tax mobilisation has been sluggish but the income tax mobilisation has recorded 99.18 per cent, whereas customs and excise has exceeded the monthly target, the department briefed the finance minister Barsha Man Pun.
"By the end of the fifth month, the revenue mobilisation will exceed the target," the officials said, adding that the mobilisation will improve in the coming months.However, the minister directed the officials to be serious to meet the revenue mobilisation target. "By the end of six months, the revenue mobilisation has to increase by 22 per cent compared to last fiscal year," he said, adding that the indicators of the economy are looking good except the revenue mobilisation.
The revenue mobilisation has to be around 20 per cent to meet the revenue target for the current fiscal year. The government has targetted to mobilise Rs 247 billion revenue in the current fiscal year despite its failure to meet the target by Rs 10 billion in the last fiscal year because of huge leakages and financial indiscipline.
The government has been able to mobilise Rs 60 billion revenue in the first four months of the current fiscal year, which is 17 per cent increment compared to the same period last fiscal year," according to the Finance Ministry that held the evaluation meeting today.
In the meeting attended by finance secretary, department heads and office chives of the Valley tax offices, the Department of Inland Revenue however claimed that the target will be met as by the third week of the fifth month (Mangsir), it has been able to mobilise Rs 70.33 billion.
The registration tax, vehicle tax and non-tax mobilisation has been sluggish but the income tax mobilisation has recorded 99.18 per cent, whereas customs and excise has exceeded the monthly target, the department briefed the finance minister Barsha Man Pun.
"By the end of the fifth month, the revenue mobilisation will exceed the target," the officials said, adding that the mobilisation will improve in the coming months.However, the minister directed the officials to be serious to meet the revenue mobilisation target. "By the end of six months, the revenue mobilisation has to increase by 22 per cent compared to last fiscal year," he said, adding that the indicators of the economy are looking good except the revenue mobilisation.
The revenue mobilisation has to be around 20 per cent to meet the revenue target for the current fiscal year. The government has targetted to mobilise Rs 247 billion revenue in the current fiscal year despite its failure to meet the target by Rs 10 billion in the last fiscal year because of huge leakages and financial indiscipline.
IMF concerned over low lending by banks
The visiting International Monetary Fund (IMF) team has suggested increasing lending as the banks have enough liquidity at present, control recurring expenses and increase capital expenditure, and improve revenue administration to meet the revenue target.
During the meeting with the team in his office on Wednesday, finance minister Barsha Man Pun informed them that the government is encouraging the banks to invest on productive sectors and trying to increase capital expenditure.
"The government has also been able to solve problems in the state oil monopoly and Nepal Electricity Authority," he informed, adding that the revenue administration has also been improved compared to last year.
"The inflation will remain in single digit, remittance inflow has improved and the country has currently Rs 330 billion foreign currency reserves," he informed, adding that the government will also achieve its growth target. "The programmes for Nepal Investment Year 2012-13 has been finalised and already identified key areas like hydropower, agriculture, tourism and infrastructure."
During the meeting with the team in his office on Wednesday, finance minister Barsha Man Pun informed them that the government is encouraging the banks to invest on productive sectors and trying to increase capital expenditure.
"The government has also been able to solve problems in the state oil monopoly and Nepal Electricity Authority," he informed, adding that the revenue administration has also been improved compared to last year.
"The inflation will remain in single digit, remittance inflow has improved and the country has currently Rs 330 billion foreign currency reserves," he informed, adding that the government will also achieve its growth target. "The programmes for Nepal Investment Year 2012-13 has been finalised and already identified key areas like hydropower, agriculture, tourism and infrastructure."
Nepali garments to benefit from Indian duty waiver
The garment industry is likely to benefit with India’s decision to end levying of additional customs duty on 162 Nepali export items, including those belonging to textile and garment industry.
In 2006, India had imposed an additional customs duty of four per cent on 331 Nepali items. Subsequently in 2008, the duty was waived off on 169 items. However, the duty continues to be levied on the remaining 162 items and would be stopped once the waiver is implemented from March 2012.
Briefing about the benefits of the waiver to Nepali textile and garment industry, commerce and supplies secretary Purushottam Ojha said that all textile and garment items are included in the waiver of additional customs duty. "The garment producers have started exporting to the Indian market since the last couple of years," he said, adding that some of them are manufacturing textiles for Indian exporters as well; they manufacture to some extent and rest of the value addition is done in India and then the final products are exported to a third country. "Both the garment sector and contract manufacturers will benefit from the waiver of additional customs duty on the textile products."
In the past, garment industry employed a large number of people. However, due to decline in garment exports, many industries closed down.
"Now, with India waiving off additional customs duty, it will certainly have a positive impact and increase Nepalese exports to India,” Ojha added. “It will, in turn, boost the industry and will consequently have positive impact on employment generation and people can have better incomes."
It will also expected to narrow down the wide trade gap that currently exists between India and Nepal.
Shankar Prasad Pandey, chairperson of Trade Committee, Federation of Nepalese Chambers of Commerce and Industry (FNCCI) said that the imposition of additional customs duty on most of the Nepali products made them uncompetitive with Indian products. "Due to this, Indian imports from Nepal dwindled," he said, "But, with the removal of the additional customs duty, we are now hopeful that all our products will be easily exported to India."
Actually, the entire process will become smoother.
”In the context of garment industry, he opines, “After this waiver, a lot of Indian companies are likely to come here in Nepal and expand their business in the Nepalese garment industry. They would even buy products from here. Thus, it will benefit Nepali as well as Indian traders and entrepreneurs.”
In 2006, India had imposed an additional customs duty of four per cent on 331 Nepali items. Subsequently in 2008, the duty was waived off on 169 items. However, the duty continues to be levied on the remaining 162 items and would be stopped once the waiver is implemented from March 2012.
Briefing about the benefits of the waiver to Nepali textile and garment industry, commerce and supplies secretary Purushottam Ojha said that all textile and garment items are included in the waiver of additional customs duty. "The garment producers have started exporting to the Indian market since the last couple of years," he said, adding that some of them are manufacturing textiles for Indian exporters as well; they manufacture to some extent and rest of the value addition is done in India and then the final products are exported to a third country. "Both the garment sector and contract manufacturers will benefit from the waiver of additional customs duty on the textile products."
In the past, garment industry employed a large number of people. However, due to decline in garment exports, many industries closed down.
"Now, with India waiving off additional customs duty, it will certainly have a positive impact and increase Nepalese exports to India,” Ojha added. “It will, in turn, boost the industry and will consequently have positive impact on employment generation and people can have better incomes."
It will also expected to narrow down the wide trade gap that currently exists between India and Nepal.
Shankar Prasad Pandey, chairperson of Trade Committee, Federation of Nepalese Chambers of Commerce and Industry (FNCCI) said that the imposition of additional customs duty on most of the Nepali products made them uncompetitive with Indian products. "Due to this, Indian imports from Nepal dwindled," he said, "But, with the removal of the additional customs duty, we are now hopeful that all our products will be easily exported to India."
Actually, the entire process will become smoother.
”In the context of garment industry, he opines, “After this waiver, a lot of Indian companies are likely to come here in Nepal and expand their business in the Nepalese garment industry. They would even buy products from here. Thus, it will benefit Nepali as well as Indian traders and entrepreneurs.”
Tuesday, December 13, 2011
Growth with employment is my dream: PM Dr Bhattarai
The country needs growth with employment, said Prime Minister Dr Baburam Bhattarai in an interaction with entrepreneurs at his official residence Baluwatar in Kathmandu today evening.
"My dream is to make Nepal a prosperous country," he said, asking the private sector to cooperate in making the country prosperous by achieving double digit growth, "which is not possible overnight."
This country has huge potential as it is rich in natural resources and we have no reason to remain poor, according to the premier, who promised to solve the problems faced by the private sector.
The representatives of Federation of Nepalese Chambers of Commerce and Industry (FNCCI) led by acting president Bhaskar Raj Rajkarnikar complained the Prime Minister of energy crisis, dual pricing in diesel, high interest rates and labour troubles that have pulled industrial growth down by discouraging the domestic investment.
"Until the domestic investors are encouraged, the foreign investors will not come to the country," the umbrella organisation of Nepali private sector said, urging Bhattarai to help create investment-friendly environment to make the Nepal Investment Year 2012-13 a success.
Energy is the engine of economic growth and the government is serious in solving its crisis, he informed. "In next two months, we will be able to import more power from India, that will help reduce the hours of load-shedding but the key problem in power import is cross border transmission line that the government is committed to construct with Indian help," the Maoist Prime Minister added.
He also promised to look after other issues the entrepreneurs raised. "The government has today finalised work plan for the Nepal Investment Year 2012-13," he said, adding that the cabinet meeting next week will approve the government plan to attract foreign investment that will help make the investment year a grand success.
The government has passed Investment Board Act and also appointed chief executive for the board through free competition, he listed his achievements.
He also showed his concern for the declining share market and requested the entrepreneurs to list their family business in the share market and help distribute wealth.
"My dream is to make Nepal a prosperous country," he said, asking the private sector to cooperate in making the country prosperous by achieving double digit growth, "which is not possible overnight."
This country has huge potential as it is rich in natural resources and we have no reason to remain poor, according to the premier, who promised to solve the problems faced by the private sector.
The representatives of Federation of Nepalese Chambers of Commerce and Industry (FNCCI) led by acting president Bhaskar Raj Rajkarnikar complained the Prime Minister of energy crisis, dual pricing in diesel, high interest rates and labour troubles that have pulled industrial growth down by discouraging the domestic investment.
"Until the domestic investors are encouraged, the foreign investors will not come to the country," the umbrella organisation of Nepali private sector said, urging Bhattarai to help create investment-friendly environment to make the Nepal Investment Year 2012-13 a success.
Energy is the engine of economic growth and the government is serious in solving its crisis, he informed. "In next two months, we will be able to import more power from India, that will help reduce the hours of load-shedding but the key problem in power import is cross border transmission line that the government is committed to construct with Indian help," the Maoist Prime Minister added.
He also promised to look after other issues the entrepreneurs raised. "The government has today finalised work plan for the Nepal Investment Year 2012-13," he said, adding that the cabinet meeting next week will approve the government plan to attract foreign investment that will help make the investment year a grand success.
The government has passed Investment Board Act and also appointed chief executive for the board through free competition, he listed his achievements.
He also showed his concern for the declining share market and requested the entrepreneurs to list their family business in the share market and help distribute wealth.
Nepali rupee drops to another historic low versus dollar
The weakening Indian rupee has once again brought the Nepali rupees to historic low against strengthening US dollars.
Today, exchange rate of Nepali rupee crossed Rs 85 for a dollar on an average as per exchange rate fixed by different commercial banks. Indian rupee with which Nepali currency is pegged had reached historic low today at Indian Currency 53.40 per dollar.
However, the Indian foreign exchange rate redeemed itself a little reaching IRs 53.18 by the mid-afternoon. The peg with Indian Currency has got Nepali Currency sliding along in spite of having not much direct relation with the appreciating dollar. The worsening Eurozone situation has strengthened dollar against its major rival currency -Euro that in turn even appreciated dollar against Indian Currency. But the remittance dependent Nepal will see the remittance inflow to grow heftily in the near future thanks to strengthening dollar as most of the workers are paid in dollars, the dollar inflow grows even if the number of migrant workers and their income remain static
The first flush of appreciating dollars has already been reflected in the first quarter remittance income of Nepal that has shot up by 28.3 per cent amounting to Rs 253 billion.
Likewise, tourist industry can be expected to see a boost thanks to strong dollars as traveling to Nepal will be less expensive affair to the tourists
Especially tourism in India can be expected to boom due to weakened IC and a portion of the foreign tourists that visit India is estimated to visit Nepal as well. On the other hand, traveling abroad for Nepali people has become an expensive affair. Especially the students outbound to USA for higher studies have been victimised by the strong dollar.
On the trade front, the strong dollar means the amount of Nepali rupees required to pay for goods and services bought in dollars that was sufficient a month ago will fall short at the current rate. The merchandise and service import paid in dollars will be expensive for Nepali people if the dollar keeps appreciating. It might even lead to inflation which has already become a Herculean task for the monetary authority due to internal supply situation.
Nepal imported goods worth Rs 133.27 billion paying in dollars in last fiscal year from third countries along with the imports worth Rs 47.8 billion from India that has been paid in dollars. The export from Nepal to third countries only amounted to Rs 21.2 billion in the review period.
The appreciating dollar will make debt servicing a difficult task for the government with the current designated amount of Rs 20.3 billion.
Dollar Exchange Rate
2007-11-18 — Rs 62.90
2009-03-11 — Rs 82.70
2010-05-03 — Rs 70.65
2011-11-23 — Rs 83.60
2011-12-13 — Rs 85
(Source: Nepal Rastra Bank)
Today, exchange rate of Nepali rupee crossed Rs 85 for a dollar on an average as per exchange rate fixed by different commercial banks. Indian rupee with which Nepali currency is pegged had reached historic low today at Indian Currency 53.40 per dollar.
However, the Indian foreign exchange rate redeemed itself a little reaching IRs 53.18 by the mid-afternoon. The peg with Indian Currency has got Nepali Currency sliding along in spite of having not much direct relation with the appreciating dollar. The worsening Eurozone situation has strengthened dollar against its major rival currency -Euro that in turn even appreciated dollar against Indian Currency. But the remittance dependent Nepal will see the remittance inflow to grow heftily in the near future thanks to strengthening dollar as most of the workers are paid in dollars, the dollar inflow grows even if the number of migrant workers and their income remain static
The first flush of appreciating dollars has already been reflected in the first quarter remittance income of Nepal that has shot up by 28.3 per cent amounting to Rs 253 billion.
Likewise, tourist industry can be expected to see a boost thanks to strong dollars as traveling to Nepal will be less expensive affair to the tourists
Especially tourism in India can be expected to boom due to weakened IC and a portion of the foreign tourists that visit India is estimated to visit Nepal as well. On the other hand, traveling abroad for Nepali people has become an expensive affair. Especially the students outbound to USA for higher studies have been victimised by the strong dollar.
On the trade front, the strong dollar means the amount of Nepali rupees required to pay for goods and services bought in dollars that was sufficient a month ago will fall short at the current rate. The merchandise and service import paid in dollars will be expensive for Nepali people if the dollar keeps appreciating. It might even lead to inflation which has already become a Herculean task for the monetary authority due to internal supply situation.
Nepal imported goods worth Rs 133.27 billion paying in dollars in last fiscal year from third countries along with the imports worth Rs 47.8 billion from India that has been paid in dollars. The export from Nepal to third countries only amounted to Rs 21.2 billion in the review period.
The appreciating dollar will make debt servicing a difficult task for the government with the current designated amount of Rs 20.3 billion.
Dollar Exchange Rate
2007-11-18 — Rs 62.90
2009-03-11 — Rs 82.70
2010-05-03 — Rs 70.65
2011-11-23 — Rs 83.60
2011-12-13 — Rs 85
(Source: Nepal Rastra Bank)
Bhatta to take part in WTO meeting
Minister for Commerce and Supplies Lekh Raj Raj Bhatta has reached Geneva leading the Nepali delegation to take part in the eighth Ministerial Conference of the World Trade Organisation (WTO).
The three-day Conference will kick off on Thursday.
Ambassador and Permanent Representative of Nepal to the United Nations and Other International Organisations Dr Dinesh Bhattarai and other officials of the Permanent Mission of Nepal in Geneva received the Nepali delegation at the Geneva International Airport.
Accompanied by Secretary Purushowttam Ojha and the representatives of private sector, Minister Bhatta had left Kathmandu yesterday night.
Minister Bhatta is set to address the Conference on Saturday, December 17. He will also participate in the SAARC Trade Ministers’ Meeting as well as the Least Developed Countries (LDCs) Ministers’ Meeting during his sojourn. Also, he will also hold bilateral meetings with his counterparts from different countries on the sidelines of the Conference.
The three-day Conference will kick off on Thursday.
Ambassador and Permanent Representative of Nepal to the United Nations and Other International Organisations Dr Dinesh Bhattarai and other officials of the Permanent Mission of Nepal in Geneva received the Nepali delegation at the Geneva International Airport.
Accompanied by Secretary Purushowttam Ojha and the representatives of private sector, Minister Bhatta had left Kathmandu yesterday night.
Minister Bhatta is set to address the Conference on Saturday, December 17. He will also participate in the SAARC Trade Ministers’ Meeting as well as the Least Developed Countries (LDCs) Ministers’ Meeting during his sojourn. Also, he will also hold bilateral meetings with his counterparts from different countries on the sidelines of the Conference.
Amnesty International asks government to protect migrant workers from ‘false promises’
Amnesty International (AI) has blamed some rogue recruitment agencies for trafficking Nepalis for exploitation and forced labour in the Gulf States and Malaysia.
The report, 'False Promises: Exploitation and forced labour of Nepalese migrant workers' published here today by the Amnesty International, also called on the government to improve protection of its migrant workers.
The migrant workers are forced to accept lower salary and even change of job from what they were promised due to exploitations of the agents, said researcher of Asia-Pacific Migrants' Rights and the author of the report Norma Kang Muico. However, some 300,000 migrant workers have paid $710,000 the recruitment agencies in the fiscal year 2008-09, she said, adding that Nepalis seek a better life abroad but fail before they even leave home, as recruitment agents – who earn huge profits – deceive them regarding their terms of contract, which is a key element in trafficking. “By the time they find out the true nature of their work, many are already trapped, saddled with large loans from private lenders with annual interest rates of up to 60 per cent."
Recruitment agencies charge an average Rs 100,000 ($1,400) for their services, three times the average annual income in Nepal, according to the report. "Being burdened with large loans and no alternative way of repaying them leaves migrant workers highly vulnerable to exploitation. The take loan at the rate of 35 per cent interest, which is more than double the bank and financial institutions rate."
The prospective migrants, who take out large loans to pay recruitment fees to secure a job overseas, unaware that recruitment agencies are deceiving them about the work, pay and conditions they are signing up to, said the report of Amnesty International that interviewed nearly 150 migrant workers and found that 90 per cent had been deceived by recruitment agencies regarding their employment contract.
However, president of Foreign Employment Association Nepal Prem Bahadur Katuwal rejected the blame and said that they have been regulated and monitored by the law.
Similarly, director general of Department of Foreign Employment Purna Chandra Bhattarai also expressed government reservation on some of the data of the report.Amnesty International documented cases where migrants were also beaten, threatened and had their freedom of movement restricted by employers in destination countries. Migrants facing exploitation or forced labour who sought assistance from Nepalis recruitment agencies or the government authorities received little support.
The report said that recruitment agencies even endorsed employers’ common practice of confiscating passports, which facilitates abuse. "Migrant women face restrictions to working abroad which increase their vulnerability," Muico said, adding that intermittent bans on domestic work and a requirement to seek family permission prior to migrating, force women to migrate through irregular channels or become ‘undocumented’.
But Bhattarai said that the legal restriction in the destination countries are more stringent than in Nepal and unless the international organisations force the destination countries to abide by the international human rights principle, the problem could not be solve.
Amnesty International interviewed migrant domestics, who had worked 21 hours per day, were not allowed to leave the house and were sexually abused by their employers. “The government must end discriminatory practices that force women migrants underground and leave them at greater risk of exploitation, without the protections available to regular migrants,” Muico added.
Nepal’s Foreign Employment Act 2007 is supposed to provide protection for migrant workers. It has directed recruitment agencies to provide migrant workers with a copy of their contract in advance and guards against excessive fees for recruitment services. It also allows for punishment of recruitment agents that fail to abide by terms of contract.
But Amnesty International’s research found evidence of violations of the law by recruitment agencies, including failure to provide contracts, changing terms and conditions and overcharging for services. But the government is failing to enforce the legislation, and no recruitment agency has been punished.
Migrant workers also have rights under the Act to compensation when their terms and conditions have not been met, yet few are aware of existing mechanisms for complaint and redress.Almost 20 per cent equal of GDP in 2010-11 came from remittances from migrants, who also provide for the needs of their own families. Official figures show that the number of Nepalis migrating abroad has increased five-fold since 2000 and that Qatar is the largest employer of Nepali migrant workers, largely due to construction ahead of the World Cup in 2022.
"If the government prioritises safe migration, it will benefit hundreds of thousands and their families each year,” Muico said, adding that it is imperative that the government acts to protect its citizens abroad which can also benefit Nepal’s economy.
The government must end impunity for rogue recruitment agencies and fully enforce the Foreign Employment Act, the report said.Amnesty International also called on the government to do more to ensure that compensation mechanisms are accessible and effective. "Many migrant workers are in the dark about their rights and don’t know who they can turn to for help. "The authorities must ensure those working abroad and their families are properly informed about the migration process,” she said.
Between September 2010 and May 2011, Amnesty International interviewed 149 returned or prospective migrant workers and met seven recruitment agencies and numerous government officials. Official figures show 294,094 Nepalis migrated abroad for work in 2010, compared with 55,025 in 2000. The majority go to Malaysia, Saudi Arabia, Qatar, and the UAE to work in construction, manufacturing and domestic work.
The report, 'False Promises: Exploitation and forced labour of Nepalese migrant workers' published here today by the Amnesty International, also called on the government to improve protection of its migrant workers.
The migrant workers are forced to accept lower salary and even change of job from what they were promised due to exploitations of the agents, said researcher of Asia-Pacific Migrants' Rights and the author of the report Norma Kang Muico. However, some 300,000 migrant workers have paid $710,000 the recruitment agencies in the fiscal year 2008-09, she said, adding that Nepalis seek a better life abroad but fail before they even leave home, as recruitment agents – who earn huge profits – deceive them regarding their terms of contract, which is a key element in trafficking. “By the time they find out the true nature of their work, many are already trapped, saddled with large loans from private lenders with annual interest rates of up to 60 per cent."
Recruitment agencies charge an average Rs 100,000 ($1,400) for their services, three times the average annual income in Nepal, according to the report. "Being burdened with large loans and no alternative way of repaying them leaves migrant workers highly vulnerable to exploitation. The take loan at the rate of 35 per cent interest, which is more than double the bank and financial institutions rate."
The prospective migrants, who take out large loans to pay recruitment fees to secure a job overseas, unaware that recruitment agencies are deceiving them about the work, pay and conditions they are signing up to, said the report of Amnesty International that interviewed nearly 150 migrant workers and found that 90 per cent had been deceived by recruitment agencies regarding their employment contract.
However, president of Foreign Employment Association Nepal Prem Bahadur Katuwal rejected the blame and said that they have been regulated and monitored by the law.
Similarly, director general of Department of Foreign Employment Purna Chandra Bhattarai also expressed government reservation on some of the data of the report.Amnesty International documented cases where migrants were also beaten, threatened and had their freedom of movement restricted by employers in destination countries. Migrants facing exploitation or forced labour who sought assistance from Nepalis recruitment agencies or the government authorities received little support.
The report said that recruitment agencies even endorsed employers’ common practice of confiscating passports, which facilitates abuse. "Migrant women face restrictions to working abroad which increase their vulnerability," Muico said, adding that intermittent bans on domestic work and a requirement to seek family permission prior to migrating, force women to migrate through irregular channels or become ‘undocumented’.
But Bhattarai said that the legal restriction in the destination countries are more stringent than in Nepal and unless the international organisations force the destination countries to abide by the international human rights principle, the problem could not be solve.
Amnesty International interviewed migrant domestics, who had worked 21 hours per day, were not allowed to leave the house and were sexually abused by their employers. “The government must end discriminatory practices that force women migrants underground and leave them at greater risk of exploitation, without the protections available to regular migrants,” Muico added.
Nepal’s Foreign Employment Act 2007 is supposed to provide protection for migrant workers. It has directed recruitment agencies to provide migrant workers with a copy of their contract in advance and guards against excessive fees for recruitment services. It also allows for punishment of recruitment agents that fail to abide by terms of contract.
But Amnesty International’s research found evidence of violations of the law by recruitment agencies, including failure to provide contracts, changing terms and conditions and overcharging for services. But the government is failing to enforce the legislation, and no recruitment agency has been punished.
Migrant workers also have rights under the Act to compensation when their terms and conditions have not been met, yet few are aware of existing mechanisms for complaint and redress.Almost 20 per cent equal of GDP in 2010-11 came from remittances from migrants, who also provide for the needs of their own families. Official figures show that the number of Nepalis migrating abroad has increased five-fold since 2000 and that Qatar is the largest employer of Nepali migrant workers, largely due to construction ahead of the World Cup in 2022.
"If the government prioritises safe migration, it will benefit hundreds of thousands and their families each year,” Muico said, adding that it is imperative that the government acts to protect its citizens abroad which can also benefit Nepal’s economy.
The government must end impunity for rogue recruitment agencies and fully enforce the Foreign Employment Act, the report said.Amnesty International also called on the government to do more to ensure that compensation mechanisms are accessible and effective. "Many migrant workers are in the dark about their rights and don’t know who they can turn to for help. "The authorities must ensure those working abroad and their families are properly informed about the migration process,” she said.
Between September 2010 and May 2011, Amnesty International interviewed 149 returned or prospective migrant workers and met seven recruitment agencies and numerous government officials. Official figures show 294,094 Nepalis migrated abroad for work in 2010, compared with 55,025 in 2000. The majority go to Malaysia, Saudi Arabia, Qatar, and the UAE to work in construction, manufacturing and domestic work.
Monday, December 12, 2011
Electronic cheque clearing most likely from next week
The much-hyped Electric Cheque Clearance (ECC) is going to start most likely from next Monday.
"We are planning to start operation of Electric Cheque Clearance (ECC) from coming Monday," said the chief executive of the Nepal Clearing House Ltd (NCHL) Nilesh Pradhan.
"We are ready with the required infrastructure and have also applied for the operation approval at the central bank," he said, adding that the company will start its operation once it gets green signal from central bank.
"But it will be in operation in the Kathmandu Valley only in the beginning," he said, adding that it will take couple of months to expand the service across the country.
The NCHL has postponed its operation twice due to dispute among the banks and financial institutions regarding the high cost. However, Pradhan claimed that most of the commercial banks that were earlier opposing it have signed agreement with the company to upgrade to the electronic cheque clearing system.
The banks and financial institutions are, however, still not comfortable with transaction cost. "The recurring cost could become burden for the financial system in the long run," a banker said, adding that the transaction cost has to be brought down as the banks cannot pass on the cost to the customers, neither they can bear it themselves.
According to the current structure, it will cost Rs 10 per cheque above Rs 5,000 and Rs 5 for a cheque upto Rs 5,000 transaction cost, except the costs that banks and financial institutions have to bear to get membership of the clearing house, buy software, network connectivity, login fee and annual renewal fee, which they are claiming to be high.
"System upgradation is a must but the central bank has to find out a way to subsidise the cost," president of Nepal Finance Companies Association Rajendra Man Shakya opined, adding that the development banks and finance companies are ready to upgrade but the cost has to be acceptable to all.
"The Class B and Class C financial institutions have to bear 64 per cent of the cost and the Class A financial institutions will bear only 36 per cent of the total cost, whereas 70 per cent of around 25,000 cheques that come for clearance everyday belongs to the commercial banks and only 30 per cent belongs to development banks and finance companies," he added.
The central bank has also been blamed for discouraging the government policy of transacting through cheque of over Rs 50,000 by making it expensive for the customers, though the central bank has cautiously said that it will not let the banks and financial institutions pass on the cost to customers.
Currently, the NCHL has central bank, Nepal Bankers Association (NBA) and SCT that provides integrated shared services network for ATMs and Point-of-sale (PoS) terminals — as its share holders as the development banks and finance companies are yet to decide their participation model.
But central bank has assured that it will keep the current manual system also in operation, if the development banks and finance companies could not participate.
But the bankers opined that the clearing house could not be able to even get its capital cost back, if the development banks and financial institutions do not participate in the system.
"We are planning to start operation of Electric Cheque Clearance (ECC) from coming Monday," said the chief executive of the Nepal Clearing House Ltd (NCHL) Nilesh Pradhan.
"We are ready with the required infrastructure and have also applied for the operation approval at the central bank," he said, adding that the company will start its operation once it gets green signal from central bank.
"But it will be in operation in the Kathmandu Valley only in the beginning," he said, adding that it will take couple of months to expand the service across the country.
The NCHL has postponed its operation twice due to dispute among the banks and financial institutions regarding the high cost. However, Pradhan claimed that most of the commercial banks that were earlier opposing it have signed agreement with the company to upgrade to the electronic cheque clearing system.
The banks and financial institutions are, however, still not comfortable with transaction cost. "The recurring cost could become burden for the financial system in the long run," a banker said, adding that the transaction cost has to be brought down as the banks cannot pass on the cost to the customers, neither they can bear it themselves.
According to the current structure, it will cost Rs 10 per cheque above Rs 5,000 and Rs 5 for a cheque upto Rs 5,000 transaction cost, except the costs that banks and financial institutions have to bear to get membership of the clearing house, buy software, network connectivity, login fee and annual renewal fee, which they are claiming to be high.
"System upgradation is a must but the central bank has to find out a way to subsidise the cost," president of Nepal Finance Companies Association Rajendra Man Shakya opined, adding that the development banks and finance companies are ready to upgrade but the cost has to be acceptable to all.
"The Class B and Class C financial institutions have to bear 64 per cent of the cost and the Class A financial institutions will bear only 36 per cent of the total cost, whereas 70 per cent of around 25,000 cheques that come for clearance everyday belongs to the commercial banks and only 30 per cent belongs to development banks and finance companies," he added.
The central bank has also been blamed for discouraging the government policy of transacting through cheque of over Rs 50,000 by making it expensive for the customers, though the central bank has cautiously said that it will not let the banks and financial institutions pass on the cost to customers.
Currently, the NCHL has central bank, Nepal Bankers Association (NBA) and SCT that provides integrated shared services network for ATMs and Point-of-sale (PoS) terminals — as its share holders as the development banks and finance companies are yet to decide their participation model.
But central bank has assured that it will keep the current manual system also in operation, if the development banks and finance companies could not participate.
But the bankers opined that the clearing house could not be able to even get its capital cost back, if the development banks and financial institutions do not participate in the system.
Saturday, December 10, 2011
NOC hikes price of diesel for industries
Nepal Oil Corporation (NOC) has decided to provide petroleum products directly from its depots to industries and big consumers but at Rs 95 per litre.But the market price is Rs 76 per litre in Kathmandu valley.
The NOC board meeting today decided to sell diesel in dual price also to provide relief to industries from prolong energy crisis– load shedding up to 16 hours. NOC estimates its loss from petroleum products will be almost Rs 1.26 billion in December following rising oil price in international market. It has been bearing a cumulative loss of over Rs 11 billion. Industrialists and big business houses have been demanding direct supply of petroleum products from NOC depot from years.
Similarly, they will have to pay around Rs 84 per liter for kerosene. The NOC had equalised the price of diesel and kerosene after a huge pressure from the dealers and consumers that it has increased adulteration. But for the consumers the kerosene and diesel prices are still equal.
The state oil monopoly’s decision is going to increase the cost of production and operation cost of the industries and development projects as one of the key component fuel price has been hiked by 25 per cent.
The NOC board meeting today decided to sell diesel in dual price also to provide relief to industries from prolong energy crisis– load shedding up to 16 hours. NOC estimates its loss from petroleum products will be almost Rs 1.26 billion in December following rising oil price in international market. It has been bearing a cumulative loss of over Rs 11 billion. Industrialists and big business houses have been demanding direct supply of petroleum products from NOC depot from years.
Similarly, they will have to pay around Rs 84 per liter for kerosene. The NOC had equalised the price of diesel and kerosene after a huge pressure from the dealers and consumers that it has increased adulteration. But for the consumers the kerosene and diesel prices are still equal.
The state oil monopoly’s decision is going to increase the cost of production and operation cost of the industries and development projects as one of the key component fuel price has been hiked by 25 per cent.
Friday, December 9, 2011
Nepal, India to review railway agreement
Nepal and India is going to review the Railway Service Agreement in January next year. The Railway Service Agreement was done in May, 2004.
“The agreement was to be reviewed in every five years but due to some reasons the agreement failed to get revised during 2009,” joint secretary at the Ministry of Commerce and Supplies Toya Narayan Gyawali said, adding that this time both the countries was going to review the Railway Service Agreement during January third week.
Revision of the agreement will be beneficial to build railway link of Birgunj dry port with Bangladesh through Rohanpur-Singhdabad route.
The two-day long Inter Government Committee (IGC) meeting between Nepal and India discussed over waiver of four per cent additional duty on all export items, implementation of provision of treaty of trade signed in October 2009, trade related technical assistance and exports of waste and scrap under the new rules of origin.
Import of petroleum by the private sector, non tariff barriers and removal of equipment for the project work in Nepal were also the important issues discussed during the meeting.
Nepal and India had a bilateral trade was $ 3.46 billion during 2009-10. Nepal's import from India amounted to $ 2924.0 million and exports to India aggregated $ 538.1million. In the first eight months of fiscal year 2010-11, Nepal's total trade with India was about $ 2.76 billion; Nepal's exports to India were about $396.0 million; and imports from India were about $2366.5 million. Since 1996, Nepal's exports to India have grown more than eleven times and bilateral trade more than seven times; the bilateral trade that was 29.8 per cent of total external trade of Nepal in year 1995-96 has increased to 67.5 per cent.
“The agreement was to be reviewed in every five years but due to some reasons the agreement failed to get revised during 2009,” joint secretary at the Ministry of Commerce and Supplies Toya Narayan Gyawali said, adding that this time both the countries was going to review the Railway Service Agreement during January third week.
Revision of the agreement will be beneficial to build railway link of Birgunj dry port with Bangladesh through Rohanpur-Singhdabad route.
The two-day long Inter Government Committee (IGC) meeting between Nepal and India discussed over waiver of four per cent additional duty on all export items, implementation of provision of treaty of trade signed in October 2009, trade related technical assistance and exports of waste and scrap under the new rules of origin.
Import of petroleum by the private sector, non tariff barriers and removal of equipment for the project work in Nepal were also the important issues discussed during the meeting.
Nepal and India had a bilateral trade was $ 3.46 billion during 2009-10. Nepal's import from India amounted to $ 2924.0 million and exports to India aggregated $ 538.1million. In the first eight months of fiscal year 2010-11, Nepal's total trade with India was about $ 2.76 billion; Nepal's exports to India were about $396.0 million; and imports from India were about $2366.5 million. Since 1996, Nepal's exports to India have grown more than eleven times and bilateral trade more than seven times; the bilateral trade that was 29.8 per cent of total external trade of Nepal in year 1995-96 has increased to 67.5 per cent.
Namje features in CNN's never heard list
The Cable News Network (CNN) listed Namje, a village in eastern Nepal in its ‘12 best places you have never heard of'.
Namje’s isolation has been its saving grace, commented the network. "It is along a series of footpaths with views of Mt Makalu, world’s fifth-tallest peak."
The destination was recommended by founder and president of Odegard Inc Stephanie Odegard. Namje does not have a single road. "The only way to get to the Nepali village is along a series of footpaths with views of Mt Makalu,” Odegard, an independent traveler, mentioned in her comment.
According to her, the place only sees a handful of outsiders a year. Odegard came upon it while she was searching for local women to harvest fiber for her rug company. "The native magar people live very close to nature, and there’s an incredible amount of spiritual activity,” she mentioned.
The other places identified by CNN are Lord HoweIsland (Australia), Saint – Sauvant (France), Keahiakawelo, Lanai (Hawaii), Sucre (Bolivia), Tusheti (Georgia), Eastern Antioquia (Colombia), Verduno (Italy), Doe Bay (Washington), Wuppertal (South Africa), Buffalo (Wyoming), and Iles De La Madeleine (Senegal).
Namje’s isolation has been its saving grace, commented the network. "It is along a series of footpaths with views of Mt Makalu, world’s fifth-tallest peak."
The destination was recommended by founder and president of Odegard Inc Stephanie Odegard. Namje does not have a single road. "The only way to get to the Nepali village is along a series of footpaths with views of Mt Makalu,” Odegard, an independent traveler, mentioned in her comment.
According to her, the place only sees a handful of outsiders a year. Odegard came upon it while she was searching for local women to harvest fiber for her rug company. "The native magar people live very close to nature, and there’s an incredible amount of spiritual activity,” she mentioned.
The other places identified by CNN are Lord HoweIsland (Australia), Saint – Sauvant (France), Keahiakawelo, Lanai (Hawaii), Sucre (Bolivia), Tusheti (Georgia), Eastern Antioquia (Colombia), Verduno (Italy), Doe Bay (Washington), Wuppertal (South Africa), Buffalo (Wyoming), and Iles De La Madeleine (Senegal).
Realtors ask to revise ceiling to home loan
The realtors want the central bank to revise the ceiling of Personal Home Loans to Rs 10 million from current Rs 8 million.
“If the Personal Home Loans ceiling is jacked up by additional Rs 2 million then the demand for apartments and houses can be expected to grow reviving the market," according to general secretary of Nepal Land and Housing Development Association (NLHDA) Min Man Shrestha.
The commercial banks have lent Rs 25.2 billion under the heading of Personal Home Loans till the first quarter of the current fiscal year. In the last quarter of the last fiscal year also the banks have floated Rs 29.5 billion under the category. Personal Home Loans floated by the banks are equivalent to 23 per cent of total loans in forwarded to real estate sector which stand at Rs 123.8 billion in the first quarter.
To give respite to realtors and prospective home buyers, central bank, in March, created a separate category for the home loans as personal Home Loans. Nepal Rastra Bank (NRB) revised the loanable amount under this heading from Rs 6 million to 8 million this fiscal year. This Personal Home Loans up to Rs 8 million is not dealt as the part of real estate and housing loans.
However, central bank is skeptic that increasing home loan ceiling will be a prudent decision. "NRB will decide whether or not to revise ceiling based on the financial market condition, but the point to be pondered is can average Nepali afford to buy a home that will require to take loan of Rs 10 million," expressed Bhaskar Mani Gyanwali, spokesperson for NRB. "The need of the movement is to build inexpensive housing unit that will be available at less than Rs 5 million so that lower middle class and middle class family can afford to buy.”
The banking sector has taken the brunt of cooling off of realty market since last one year as the loan default rate and Non Performing Assets (NPA) have since then growing. Moreover, scaled up interest rate following the liquidity crunch have further pushed the real estate market into recession like situation coupled up with lowered demand.
"The major factor than can stoke the realty market is reduction of interest rate, at 15-16 per cent interest not many people can afford to borrow and buy homes," said Shrestha, adding, that 10 per cent is the ideal rate in which everyone is a winner.
NHLDA has submitted a request to NRB including these issues along with refinancing affordable housing projects as a means to revive real estate and housing market.
From the fear of eventual systemic failure invited by banks and financial institutions' overexposure to realty, NRB directed the financial institutions to restrict the credit flow to a single sector to 25 per cent of their total lending, in December 2009. During that time, the boom in housing and realty contributed to high lending exposure in the sector so that few of the commercial banks’ portfolios showed dangerously large amount of credit floated to the realty.
New rule
KATHMANDU: Nepal Rastra Bank (NRB) has allowed the class 'B' and 'C' financial institutions with headquarters situated outside Kathmandu valley to maintain interest yielding all accounts in other commercial banks till the end of this fiscal year, issuing a circular on Friday. "The financial institutions outside Kathmandu do not have options much for investments so central bank has allowed then to maintain interest yielding accounts," informed Bhaskar Mani Gyanwali, spokesperson for NRB. Likewise, the same circular has also asked all the class 'D' microfinance institutions, co-operatives and NGOs licensed by NRB to undertake limited banking services to submit the credit information regarding borrowers that have borrowed funds exceeding Rs 30,000 to Credit Information Bureau (CIB).
“If the Personal Home Loans ceiling is jacked up by additional Rs 2 million then the demand for apartments and houses can be expected to grow reviving the market," according to general secretary of Nepal Land and Housing Development Association (NLHDA) Min Man Shrestha.
The commercial banks have lent Rs 25.2 billion under the heading of Personal Home Loans till the first quarter of the current fiscal year. In the last quarter of the last fiscal year also the banks have floated Rs 29.5 billion under the category. Personal Home Loans floated by the banks are equivalent to 23 per cent of total loans in forwarded to real estate sector which stand at Rs 123.8 billion in the first quarter.
To give respite to realtors and prospective home buyers, central bank, in March, created a separate category for the home loans as personal Home Loans. Nepal Rastra Bank (NRB) revised the loanable amount under this heading from Rs 6 million to 8 million this fiscal year. This Personal Home Loans up to Rs 8 million is not dealt as the part of real estate and housing loans.
However, central bank is skeptic that increasing home loan ceiling will be a prudent decision. "NRB will decide whether or not to revise ceiling based on the financial market condition, but the point to be pondered is can average Nepali afford to buy a home that will require to take loan of Rs 10 million," expressed Bhaskar Mani Gyanwali, spokesperson for NRB. "The need of the movement is to build inexpensive housing unit that will be available at less than Rs 5 million so that lower middle class and middle class family can afford to buy.”
The banking sector has taken the brunt of cooling off of realty market since last one year as the loan default rate and Non Performing Assets (NPA) have since then growing. Moreover, scaled up interest rate following the liquidity crunch have further pushed the real estate market into recession like situation coupled up with lowered demand.
"The major factor than can stoke the realty market is reduction of interest rate, at 15-16 per cent interest not many people can afford to borrow and buy homes," said Shrestha, adding, that 10 per cent is the ideal rate in which everyone is a winner.
NHLDA has submitted a request to NRB including these issues along with refinancing affordable housing projects as a means to revive real estate and housing market.
From the fear of eventual systemic failure invited by banks and financial institutions' overexposure to realty, NRB directed the financial institutions to restrict the credit flow to a single sector to 25 per cent of their total lending, in December 2009. During that time, the boom in housing and realty contributed to high lending exposure in the sector so that few of the commercial banks’ portfolios showed dangerously large amount of credit floated to the realty.
New rule
KATHMANDU: Nepal Rastra Bank (NRB) has allowed the class 'B' and 'C' financial institutions with headquarters situated outside Kathmandu valley to maintain interest yielding all accounts in other commercial banks till the end of this fiscal year, issuing a circular on Friday. "The financial institutions outside Kathmandu do not have options much for investments so central bank has allowed then to maintain interest yielding accounts," informed Bhaskar Mani Gyanwali, spokesperson for NRB. Likewise, the same circular has also asked all the class 'D' microfinance institutions, co-operatives and NGOs licensed by NRB to undertake limited banking services to submit the credit information regarding borrowers that have borrowed funds exceeding Rs 30,000 to Credit Information Bureau (CIB).
Nepal to get more support from Asian Development Fund
Based on the previous history of proper usages of resources, Nepal is eligible to receive more financial support from Asian Development Fund (ADF).
“Nepal is working towards minimising corruption and misuse of funds through different mechanisms like e-tendering and similar tools that will ensure the grants reach the targeted groups,” assured finance secretary Krishna Hari Baskota, addressing the donors, during the recent meeting of Asian Development Fund in Dhaka.
The country will be achieving tentative growth rate of five per cent, single digit inflation and is working towards increasing foreign currency reserve sufficient to bear the cost of import of service and goods for seven months, he said, adding that the sustained use of foreign aid has pushed Nepal closer to attaining majority of Millennium Development Goals (MDGs).
Along with an improved image on different frontiers and indicators like competitiveness will guarantee that the funds will not be misutilised, the finance secretary assured, pledging that Nepal is suitable to receive more financial assistance in future for its development works.
The country has, so far, received funds worth $1.3 billion from the Asian Development Fund that has been investing in infrastructure development, economic stability, governance, environmental issues, agriculture development, education, energy and other similar social and economic sectors contributing in improving living standard of Nepalis.
Nepal is fifth largest aid receiver from Asian Development Fund (ADF) which Bangladesh is the largest aid receiver with $3.2 billion.
However, donor countries asked the aid recipient countries to be more dependent on their internal sources for development works citing the contraction in their respective economies following the eminent recession. The meeting at Dhaka is the second round of tri-partite meeting between, Asian Development Bank (ADB), donor countries and the aid recipient countries.
The first round was conducted in Manila in September and the third one will once again be held in Manila in March 2011 that will decide the amount the donor countries will be providing to support the Asian developing countries.
Representatives from 28 donor countries including US, Japan, United Kingdom, Sweden, Norway, Germany, Australia, and France were present in the meeting along with the donor recipient countries including Nepal, Afganistan, Bang-ladesh, Mongolia, Solomon Islands and Vietnam.
“Nepal is working towards minimising corruption and misuse of funds through different mechanisms like e-tendering and similar tools that will ensure the grants reach the targeted groups,” assured finance secretary Krishna Hari Baskota, addressing the donors, during the recent meeting of Asian Development Fund in Dhaka.
The country will be achieving tentative growth rate of five per cent, single digit inflation and is working towards increasing foreign currency reserve sufficient to bear the cost of import of service and goods for seven months, he said, adding that the sustained use of foreign aid has pushed Nepal closer to attaining majority of Millennium Development Goals (MDGs).
Along with an improved image on different frontiers and indicators like competitiveness will guarantee that the funds will not be misutilised, the finance secretary assured, pledging that Nepal is suitable to receive more financial assistance in future for its development works.
The country has, so far, received funds worth $1.3 billion from the Asian Development Fund that has been investing in infrastructure development, economic stability, governance, environmental issues, agriculture development, education, energy and other similar social and economic sectors contributing in improving living standard of Nepalis.
Nepal is fifth largest aid receiver from Asian Development Fund (ADF) which Bangladesh is the largest aid receiver with $3.2 billion.
However, donor countries asked the aid recipient countries to be more dependent on their internal sources for development works citing the contraction in their respective economies following the eminent recession. The meeting at Dhaka is the second round of tri-partite meeting between, Asian Development Bank (ADB), donor countries and the aid recipient countries.
The first round was conducted in Manila in September and the third one will once again be held in Manila in March 2011 that will decide the amount the donor countries will be providing to support the Asian developing countries.
Representatives from 28 donor countries including US, Japan, United Kingdom, Sweden, Norway, Germany, Australia, and France were present in the meeting along with the donor recipient countries including Nepal, Afganistan, Bang-ladesh, Mongolia, Solomon Islands and Vietnam.
Thursday, December 8, 2011
SAFA Award for Nepali corporate houses
Credit Information Bureau (CIB) bagged the second runner-up award in Best Presented Accounts (BPA) amongst the public sector in the South Asia Federation of Accountants (SAFA) Awards in Dhaka on November 29.
Similarly, Nabil Bank, Standard Chartered Bank Nepal, NIC Bank were awarded with Certificate of Merit under the Banking Sector, while Ace Development Bank and Butwal Power Company were also awarded Certificate of Merit under Financial Service Sector and Manufacturing Sector respectively.
Among the various corporate houses that were awarded with Best Presented Accounts (BPA) in the event held at Dhaka, Bangladesh on November 29 organised by South Asia Federation of Accountants (SAFA), an apex body of SAARC, Nabil Bank was the winner of BPA Award in Nepal with Standard Chartered Bank Nepal as first runner up and NIC Bank as second runner up under Banking Sector Category.
It is not only a satisfying achievement but also substantiates accounting and disclosure practices followed in Nepal and they are in line with international standards, according to the winners.
Similarly, Ace Development Bank, Butwal Power Company and Credit Information Centre were the winner of BPA Award in Nepal in financial service sector, manufacturing sector and public sector entities, respectively.
The president of the Institute of Chartered Accountants of Nepal (ICAN) Sudarshan Raj Pandey expressed happiness with the result of Nepal where more numbers of corporate were awarded with coveted awards.
"Domestic corporate sector has made Nepal proud,” Pandey added.
Similarly, Nabil Bank, Standard Chartered Bank Nepal, NIC Bank were awarded with Certificate of Merit under the Banking Sector, while Ace Development Bank and Butwal Power Company were also awarded Certificate of Merit under Financial Service Sector and Manufacturing Sector respectively.
Among the various corporate houses that were awarded with Best Presented Accounts (BPA) in the event held at Dhaka, Bangladesh on November 29 organised by South Asia Federation of Accountants (SAFA), an apex body of SAARC, Nabil Bank was the winner of BPA Award in Nepal with Standard Chartered Bank Nepal as first runner up and NIC Bank as second runner up under Banking Sector Category.
It is not only a satisfying achievement but also substantiates accounting and disclosure practices followed in Nepal and they are in line with international standards, according to the winners.
Similarly, Ace Development Bank, Butwal Power Company and Credit Information Centre were the winner of BPA Award in Nepal in financial service sector, manufacturing sector and public sector entities, respectively.
The president of the Institute of Chartered Accountants of Nepal (ICAN) Sudarshan Raj Pandey expressed happiness with the result of Nepal where more numbers of corporate were awarded with coveted awards.
"Domestic corporate sector has made Nepal proud,” Pandey added.
Asia-Pacific visitor arrivals up by six per cent in September
With highest South Asian arrival, international visitor arrivals into Asia-Pacific destinations for September showed a collective year-on-year increase of 5.7 per cent, a decline of half a percentage point from the previous month’s growth rate, according to the Pacific Asia Travel Association (PATA) today released its preliminary results.
For the first nine months of 2011, all Asia Pacific sub-regions maintained a positive performance, although at different levels of growth led by South Asian growth of 14 per cent, Southeast Asia up by 12 per cent, Northeast Asia up by four per cent, and the Pacific up by one per cent.
South Asia led the pack for the month of September with an 11 per cent increase. It added nearly 60,000 more international visitors to the sub-region over the corresponding period last year. For the four smaller volume destinations reporting source market information — Bhutan, Maldives, Nepal and Sri Lanka — arrivals from Asia increased significantly in terms of both volume and growth rate.
The number of arrivals from Asian origin markets – supported by strong demand from China and India – was well above that of the European generating markets for the fifth consecutive month. It was also influenced by a downturn in arrivals from the UK and Italy to various South Asia destinations.
Southeast Asia registered a relatively slower growth rate of nine per cent in September driven in part by a strong negative performance by Vietnam (down by 13 per cent). Even so, the growth rates into all other destinations remained relatively strong as can be seen by the individual country performances; Myanmar (+25per cent), Thailand (+23per cent), Cambodia (+21per cent), Indonesia (+16per cent), the Philippines (+15per cent) and Singapore (+nine per cent). Malaysia is still unable to release arrivals figures because of difficulties with a new immigration system.
International arrivals to Northeast Asia showed moderate growth for September with a collective gain of five per cent year-on-year. Despite the slower sub-regional average growth rate, foreign arrivals into specific destinations, within the sub-region were very strong. Korea (RoK) for example saw a gain of 19 per cent for the month. Macau SAR saw an 18 per cent increase. Hong Kong SAR expanded by 17 per cent, while Chinese Taipei reported a 10 per cent gain.At the other end of the spectrum, however, China saw another relatively passive month of weak demand (+0.5 per cent). Foreign inbound traffic into Japan (-25 per cent) continued to improve progressively but still very slowly. Year-to-date growth in arrivals to the sub-region remains somewhat slower at four per cent following a very strong increase of 12 per cent in the January to September of 2010. The downward shift reflects some softening in travel demand to the sub-region that can be attributed – at least in part – to the continuing uncertainty associated with radiation in Japan.Travel demand to the Pacific remained sluggish during September with arrivals to the sub-region growing by only one per cent. Growth for the sub-region was supported by the Rugby World Cup in New Zealand which saw an increase of 26 per cent in foreign arrivals.
On the back side of that however, the Rugby World Cup also had some role in dampening outbound from New Zealand to Australia, resulting in an overall decline of nine per cent for Australia during September. Most Pacific island nations recorded year-on-year increases in international arrivals for the month of September. The only exceptions were the Northern Marianas (-15 per cent), Samoa (-14 per cent), Guam (-6 per cent) and the Cook Islands (-1 per cent).
According toPATA CEO Martin Craigs, “International arrivals momentum into the Asia-Pacific region continues to hold at a relatively strong average rate of around six per cent. “The rising tide is not, however, lifting all boats equally,” he said, adding that a few Asia Pacific destinations are facing difficulties and experiencing contracting numbers of visitors.
For the first nine months of 2011, all Asia Pacific sub-regions maintained a positive performance, although at different levels of growth led by South Asian growth of 14 per cent, Southeast Asia up by 12 per cent, Northeast Asia up by four per cent, and the Pacific up by one per cent.
South Asia led the pack for the month of September with an 11 per cent increase. It added nearly 60,000 more international visitors to the sub-region over the corresponding period last year. For the four smaller volume destinations reporting source market information — Bhutan, Maldives, Nepal and Sri Lanka — arrivals from Asia increased significantly in terms of both volume and growth rate.
The number of arrivals from Asian origin markets – supported by strong demand from China and India – was well above that of the European generating markets for the fifth consecutive month. It was also influenced by a downturn in arrivals from the UK and Italy to various South Asia destinations.
Southeast Asia registered a relatively slower growth rate of nine per cent in September driven in part by a strong negative performance by Vietnam (down by 13 per cent). Even so, the growth rates into all other destinations remained relatively strong as can be seen by the individual country performances; Myanmar (+25per cent), Thailand (+23per cent), Cambodia (+21per cent), Indonesia (+16per cent), the Philippines (+15per cent) and Singapore (+nine per cent). Malaysia is still unable to release arrivals figures because of difficulties with a new immigration system.
International arrivals to Northeast Asia showed moderate growth for September with a collective gain of five per cent year-on-year. Despite the slower sub-regional average growth rate, foreign arrivals into specific destinations, within the sub-region were very strong. Korea (RoK) for example saw a gain of 19 per cent for the month. Macau SAR saw an 18 per cent increase. Hong Kong SAR expanded by 17 per cent, while Chinese Taipei reported a 10 per cent gain.At the other end of the spectrum, however, China saw another relatively passive month of weak demand (+0.5 per cent). Foreign inbound traffic into Japan (-25 per cent) continued to improve progressively but still very slowly. Year-to-date growth in arrivals to the sub-region remains somewhat slower at four per cent following a very strong increase of 12 per cent in the January to September of 2010. The downward shift reflects some softening in travel demand to the sub-region that can be attributed – at least in part – to the continuing uncertainty associated with radiation in Japan.Travel demand to the Pacific remained sluggish during September with arrivals to the sub-region growing by only one per cent. Growth for the sub-region was supported by the Rugby World Cup in New Zealand which saw an increase of 26 per cent in foreign arrivals.
On the back side of that however, the Rugby World Cup also had some role in dampening outbound from New Zealand to Australia, resulting in an overall decline of nine per cent for Australia during September. Most Pacific island nations recorded year-on-year increases in international arrivals for the month of September. The only exceptions were the Northern Marianas (-15 per cent), Samoa (-14 per cent), Guam (-6 per cent) and the Cook Islands (-1 per cent).
According toPATA CEO Martin Craigs, “International arrivals momentum into the Asia-Pacific region continues to hold at a relatively strong average rate of around six per cent. “The rising tide is not, however, lifting all boats equally,” he said, adding that a few Asia Pacific destinations are facing difficulties and experiencing contracting numbers of visitors.
Global investors still optimistic on emerging market prospects
Heightened global risk perceptions in the aftermath of the financial crisis, fueled by sovereign credit risk in the developed world and political crises in the Middle East and North Africa, have increased investors’ concerns, according to a new report by the World Bank’s Multilateral Investment Guarantee Agency (MIGA).
However, the report, World Investment and Political Risk, notes that investors are more optimistic over the medium term.
A survey of global investors conducted for the report finds they are 'cautiously optimistic' about their investment plans in the next 12 months. They are more confident over the next three years: nearly 75 per cent of corporate respondents have plans to expand in developing countries over this period.
MIGA’s survey shows that events in the Middle East and North Africa have had a negative effect on foreign direct investment (FDI), but a significant majority of global investors said they have not changed their investment plans. However, while investors appear willing to ride out this period of turmoil and uncertainty, they are also ready to downsize plans should political instability intensify and become prolonged.
Overall, the report notes that the recorded growth of private capital flows to developing countries, including FDI, is moderating, but is expected to regain speed in the medium term— corroborating the sentiment found in the investor survey. “This uncertain economic landscape aside, developing countries are expected to grow more than twice as fast as high-income economies over the next few years,” notes MIGA’s executive vice president Izumi Kobayashi. “This continued growth, together with stronger and more business-friendly environments, should enhance their appeal to savvy investors worldwide.”
The report notes developing countries now attract two-fifths of global FDI and originate close to one-fifth of overseas investment. Nonetheless, political risk remains a significant constraint to investment in these countries, becoming more prominent over the next three years as current concerns about the global economy subside.
The survey found that heightened global risk perceptions have prompted investors to employ a wide variety of risk-mitigation tools, including political risk insurance (PRI). PRI issuance has grown, not only in absolute terms, but also relative to FDI. Over the past five years, the rate of growth of PRI has exceeded that of FDI, meaning that a higher percentage of FDI is now insured for political risk. In 2011, this trend appears to be continuing.
Concerns about expropriation remain elevated and the report provides an in-depth analysis of this risk. It found that the probability of disputes between governments and foreign investors is materially increased by an economic shock and/or significant political shift. Evidence also shows that investor disputes are more likely to be resolved—avoiding outright expropriation— by democratically elected governments rather than non-democratic regimes.
“In today’s turbulent world, we hope that this report sheds light on different dimensions of political risk and the role of investment insurance in fostering an environment conducive to attracting FDI and promoting development,” says Kobayashi.
However, the report, World Investment and Political Risk, notes that investors are more optimistic over the medium term.
A survey of global investors conducted for the report finds they are 'cautiously optimistic' about their investment plans in the next 12 months. They are more confident over the next three years: nearly 75 per cent of corporate respondents have plans to expand in developing countries over this period.
MIGA’s survey shows that events in the Middle East and North Africa have had a negative effect on foreign direct investment (FDI), but a significant majority of global investors said they have not changed their investment plans. However, while investors appear willing to ride out this period of turmoil and uncertainty, they are also ready to downsize plans should political instability intensify and become prolonged.
Overall, the report notes that the recorded growth of private capital flows to developing countries, including FDI, is moderating, but is expected to regain speed in the medium term— corroborating the sentiment found in the investor survey. “This uncertain economic landscape aside, developing countries are expected to grow more than twice as fast as high-income economies over the next few years,” notes MIGA’s executive vice president Izumi Kobayashi. “This continued growth, together with stronger and more business-friendly environments, should enhance their appeal to savvy investors worldwide.”
The report notes developing countries now attract two-fifths of global FDI and originate close to one-fifth of overseas investment. Nonetheless, political risk remains a significant constraint to investment in these countries, becoming more prominent over the next three years as current concerns about the global economy subside.
The survey found that heightened global risk perceptions have prompted investors to employ a wide variety of risk-mitigation tools, including political risk insurance (PRI). PRI issuance has grown, not only in absolute terms, but also relative to FDI. Over the past five years, the rate of growth of PRI has exceeded that of FDI, meaning that a higher percentage of FDI is now insured for political risk. In 2011, this trend appears to be continuing.
Concerns about expropriation remain elevated and the report provides an in-depth analysis of this risk. It found that the probability of disputes between governments and foreign investors is materially increased by an economic shock and/or significant political shift. Evidence also shows that investor disputes are more likely to be resolved—avoiding outright expropriation— by democratically elected governments rather than non-democratic regimes.
“In today’s turbulent world, we hope that this report sheds light on different dimensions of political risk and the role of investment insurance in fostering an environment conducive to attracting FDI and promoting development,” says Kobayashi.
Wednesday, December 7, 2011
Counter employment consequences of global economic turmoil
Representatives of governments, workers and employers from the Asian, Pacific and Arab states have concluded a four-day meeting at which they discussed ways the region could prepare to counter the consequences of the current economic uncertainty.
In conclusions adopted at the close of the ILO’s 15th Asia and the Pacific Regional Meeting (APRM), delegates agreed that employment and support for decent work must be at the heart of policies for strong, sustainable, balanced growth and development.
They called for policy packages (based on the ILO’s Global Jobs Pact) to promote equitable, jobs-rich growth. Essential to this would be the involvement of the ILO’s tripartite constituents — governments, workers’ and employers’ organisations —effective social dialogue and the promotion of collective bargaining. Increased productivity should be the foundation for improved living and working conditions, rising incomes and more decent work opportunities.
Measures to improve preparedness to deal with a deteriorating global economic situation include support for sustainable enterprises and employment-intensive investment, development of minimum wage systems, the building of effective social protection floors, promoting greener growth and green jobs, and policies to address issues relating to youth employment and labour migration.
The APRM also looked at ways that employment and social policies can be applied to relieve the effects off natural disasters, to which the Asia Pacific region is particularly prone.
Delegates thanked the Japanese Government for organizing a special session on this topic, which allowed them to share knowledge and draw important lessons on disaster response and employment policy.
The meeting also hosted the Asian launch of the Bachelet Report, “Social Protection Floor for a Fair and Inclusive Globalisation”, presented by one of the members of the Advisory Group Member Secretary of the Planning Commission of India Sudha Pillai. “Building effective social protection floors, in line with national circumstances” was among the priorities identifed in the APRM conclusions.
“This region has been the world’s most dynamic region, economically, but we have not been getting enough jobs, decent work, from this growth,” said Sachiko Yamamoto, ILO Regional Director for Asia and the Pacific. “Most developing economies in the region have working age populations that are growing fast, but often we only see one to two per cent employment growth for six to seven per cent of output growth. So if output growth drops below six per cent the region will not be producing enough jobs to meet the needs of those looking for work, particularly young people.”
“Even before the current turmoil this growth was unevenly shared and inequalities were increasing. This inequality threatens economic and social progress if it is not addressed,” she added.
The tripartite partners noted the links between recent developments in some Arab countries and the consequences of social exclusion, lack of decent jobs and the denial of fundamental rights. They recognised the importance of the Decent Work Agenda in addressing widespread demands for social justice, dignity, decent jobs, respect for fundamental rights and an end to economic exclusion. They agreed to intensify efforts to ratify and implement core labour standards.
"This is a dynamic region facing huge challenges. To ensure that decent work and full employment are at the heart of sustainable development will be a key." Said ILO regional director for the Arab States Nada Al-Nashif.
“Our region needs growth that can deliver more and better jobs and to ensure that the most vulnerable are protected as they work their way out of poverty and informality. Social dialogue and effective cooperation, bringing together workers', employers' and governments, must be our watchwords for fulfilling these goals and meeting the aspirations of the youth of today and our future generations”.
More than 410 delegates, representing governments, workers and employers, from 38 countries attended the 15th APRM, which was opened by Prime Minister of Japan Yoshihiko Noda and ILO director general Juan Somavia.
Other keynote speakers included vice prime minister of Timor Leste Dr Jose Luis Guterres, director general of the Arab Labour Organisation Dr Ahmed Luqman and, secretary general of ASEAN Dr Surin Pitsuwan.
The ILO is the UN specialised agency dealing with work and work-related issues. It has a unique tripartite membership structure, under which governments, employers' and workers' organisations act as equal partners, making decisions representative of the real economy.
In conclusions adopted at the close of the ILO’s 15th Asia and the Pacific Regional Meeting (APRM), delegates agreed that employment and support for decent work must be at the heart of policies for strong, sustainable, balanced growth and development.
They called for policy packages (based on the ILO’s Global Jobs Pact) to promote equitable, jobs-rich growth. Essential to this would be the involvement of the ILO’s tripartite constituents — governments, workers’ and employers’ organisations —effective social dialogue and the promotion of collective bargaining. Increased productivity should be the foundation for improved living and working conditions, rising incomes and more decent work opportunities.
Measures to improve preparedness to deal with a deteriorating global economic situation include support for sustainable enterprises and employment-intensive investment, development of minimum wage systems, the building of effective social protection floors, promoting greener growth and green jobs, and policies to address issues relating to youth employment and labour migration.
The APRM also looked at ways that employment and social policies can be applied to relieve the effects off natural disasters, to which the Asia Pacific region is particularly prone.
Delegates thanked the Japanese Government for organizing a special session on this topic, which allowed them to share knowledge and draw important lessons on disaster response and employment policy.
The meeting also hosted the Asian launch of the Bachelet Report, “Social Protection Floor for a Fair and Inclusive Globalisation”, presented by one of the members of the Advisory Group Member Secretary of the Planning Commission of India Sudha Pillai. “Building effective social protection floors, in line with national circumstances” was among the priorities identifed in the APRM conclusions.
“This region has been the world’s most dynamic region, economically, but we have not been getting enough jobs, decent work, from this growth,” said Sachiko Yamamoto, ILO Regional Director for Asia and the Pacific. “Most developing economies in the region have working age populations that are growing fast, but often we only see one to two per cent employment growth for six to seven per cent of output growth. So if output growth drops below six per cent the region will not be producing enough jobs to meet the needs of those looking for work, particularly young people.”
“Even before the current turmoil this growth was unevenly shared and inequalities were increasing. This inequality threatens economic and social progress if it is not addressed,” she added.
The tripartite partners noted the links between recent developments in some Arab countries and the consequences of social exclusion, lack of decent jobs and the denial of fundamental rights. They recognised the importance of the Decent Work Agenda in addressing widespread demands for social justice, dignity, decent jobs, respect for fundamental rights and an end to economic exclusion. They agreed to intensify efforts to ratify and implement core labour standards.
"This is a dynamic region facing huge challenges. To ensure that decent work and full employment are at the heart of sustainable development will be a key." Said ILO regional director for the Arab States Nada Al-Nashif.
“Our region needs growth that can deliver more and better jobs and to ensure that the most vulnerable are protected as they work their way out of poverty and informality. Social dialogue and effective cooperation, bringing together workers', employers' and governments, must be our watchwords for fulfilling these goals and meeting the aspirations of the youth of today and our future generations”.
More than 410 delegates, representing governments, workers and employers, from 38 countries attended the 15th APRM, which was opened by Prime Minister of Japan Yoshihiko Noda and ILO director general Juan Somavia.
Other keynote speakers included vice prime minister of Timor Leste Dr Jose Luis Guterres, director general of the Arab Labour Organisation Dr Ahmed Luqman and, secretary general of ASEAN Dr Surin Pitsuwan.
The ILO is the UN specialised agency dealing with work and work-related issues. It has a unique tripartite membership structure, under which governments, employers' and workers' organisations act as equal partners, making decisions representative of the real economy.
Nepal to lift ban on Indian IRs 500, IRs 1,000 notes
Nepal is looking at the possibility of lifting the ban on use of Indian Currency (IC) notes of denomination of IRs 500 and IRs 1,000.
The issue came up for discussion between India's commerce secretary Rahul Khullar and his counterpart Purushottam Ojha in New Delhi yesterday.
"The Nepali side noted the possibility that notes of IRs 500 and IRs 1000 denomination may be rendered legitimate for use in Nepal," the minutes of the meeting said.Nepal had banned use of IRs 500 over a decade ago in June 2000 due to rising fake Indian currency circulation.
The Nepali workers in India have been facing difficulties in repatriating their hard-earned income to Nepal owing to de-legitimisation of IRs 500 and IRs 1,000 and requested that the notes may be allowed for legitimate use in Nepal.
Indian side reiterated its concern regarding circulation of fake Indian currency notes through Nepal and its security implications thereof.
"Nepali side informed that vigilance has been increased to see that such illegal activities are curtailed but Indian side agreed that a strategy should be devised for detecting and punishing those involved in circulation of counterfeit currency," the minutes said.
The meeting of India-Nepal inter-governmental committee (IGC) on trade, transit and cooperation to control unauthorised trade also discussed about export and registration of pharmaceuticals in Nepal.
Indian side stated that Nepal has stopped registration of pharma manufacturing companies until further notice, as a result no new products can be registered and exported to Nepal.
The issue came up for discussion between India's commerce secretary Rahul Khullar and his counterpart Purushottam Ojha in New Delhi yesterday.
"The Nepali side noted the possibility that notes of IRs 500 and IRs 1000 denomination may be rendered legitimate for use in Nepal," the minutes of the meeting said.Nepal had banned use of IRs 500 over a decade ago in June 2000 due to rising fake Indian currency circulation.
The Nepali workers in India have been facing difficulties in repatriating their hard-earned income to Nepal owing to de-legitimisation of IRs 500 and IRs 1,000 and requested that the notes may be allowed for legitimate use in Nepal.
Indian side reiterated its concern regarding circulation of fake Indian currency notes through Nepal and its security implications thereof.
"Nepali side informed that vigilance has been increased to see that such illegal activities are curtailed but Indian side agreed that a strategy should be devised for detecting and punishing those involved in circulation of counterfeit currency," the minutes said.
The meeting of India-Nepal inter-governmental committee (IGC) on trade, transit and cooperation to control unauthorised trade also discussed about export and registration of pharmaceuticals in Nepal.
Indian side stated that Nepal has stopped registration of pharma manufacturing companies until further notice, as a result no new products can be registered and exported to Nepal.
Tuesday, December 6, 2011
Nepal-India to share information on flow of dirty money
Nepal Rastra Bank (NRB) Financial Information Unit (FIU) and Financial Intelligence Unit-India entered into an agreement to check the flow of dirty money between the two countries.
Central bank's FIU chief Dharma Raj Sapkota and Financial Intelligence Unit-India's Pravin Kumer Tiwari signed a Memorandum of Understanding (MoU) on behalf of their respective institutions on November 17.
The move is supposed to help at curbing the money laundering — turning the illegal money into legal — that can used in funding terrorist or in other illegal drugs and arms related trafficking.
The information on any sort of illegal money laundering and funding of terrorist activities has to be shared among the nations that have entered into an agreement through such MoUs that is supposed to help minimising the instances of such unlawful activities.
Since such money laundering activities are not confined in a single country or jurisdiction, sharing information can be of crucial importance in curbing such activities.
Nepal had entered into similar agreement with other countries like Taiwan of China, Bangladesh, Sri Lanka, Mongolia, Thailand among others, so that, Nepal can exchange information of suspected dirty money flow information with eight other countries.
Signing of the agreement regarding information sharing with other countries will also enable Nepal to strengthen its position in the fight against money laundering. The Anti Money Laundering (AML) Act has already included banks and financial institutions, money changers, remittance agencies, casino, share traders, insurance agencies, land revenue office, Company Registrars’ Office, tax administration, gems and precious metals dealers, lawyers and accountants to provide information to FIU regarding any suspicious transactions or the ones exceeding Rs 1 million of their respective clients.
Central bank's FIU chief Dharma Raj Sapkota and Financial Intelligence Unit-India's Pravin Kumer Tiwari signed a Memorandum of Understanding (MoU) on behalf of their respective institutions on November 17.
The move is supposed to help at curbing the money laundering — turning the illegal money into legal — that can used in funding terrorist or in other illegal drugs and arms related trafficking.
The information on any sort of illegal money laundering and funding of terrorist activities has to be shared among the nations that have entered into an agreement through such MoUs that is supposed to help minimising the instances of such unlawful activities.
Since such money laundering activities are not confined in a single country or jurisdiction, sharing information can be of crucial importance in curbing such activities.
Nepal had entered into similar agreement with other countries like Taiwan of China, Bangladesh, Sri Lanka, Mongolia, Thailand among others, so that, Nepal can exchange information of suspected dirty money flow information with eight other countries.
Signing of the agreement regarding information sharing with other countries will also enable Nepal to strengthen its position in the fight against money laundering. The Anti Money Laundering (AML) Act has already included banks and financial institutions, money changers, remittance agencies, casino, share traders, insurance agencies, land revenue office, Company Registrars’ Office, tax administration, gems and precious metals dealers, lawyers and accountants to provide information to FIU regarding any suspicious transactions or the ones exceeding Rs 1 million of their respective clients.
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