Tuesday, August 21, 2012

US aid to focus on health sector this fiscal year

The United States Agency for International Development (USAID) Nepal will invest almost half of its aid in the health sector in the current fiscal year, though the 'five year (2013-2017) aid strategy' focuses on developing Nepal as a democratic and prosperous country.
"The US will continue to help Nepal under US government policy," said USAID mission director to Nepal David C Atteberry during a consultative meeting on 'five-year (2013-2017) aid strategy of the US government to Nepal', at the Finance Ministry here today.
"The US will help Nepal also according to the country's priority, and national and sectoral strategy, but for the current fiscal year, the agency will invest half of its total aid in the health sector," he added.
Hailing the US government's efforts in helping Nepal on the occasion, finance secretary Krishna Hari Baskota urged the US to help Nepal especially in local development, agriculture and education.
Aimed at helping Nepal develop as a democratic and prosperous country, the five-year aid strategy has focused on effective good governance, inclusiveness and accountability, besides strengthening economic, environmental and social ability of the communities.
USAID — the US government agency that provides development aid — ranked among the top five bilateral donors in Nepal for fiscal year 2010-11 after the UK ($92.1 million), Japan ($58.7 million), India ($50.7 million) — with $48.5 million aid to the country, according to the Development Cooperation Report 2010-11.
"Of the total foreign aid disbursed that stood at $1.08 billion in 2010-11, USAID contributed 4.5 per cent," the report said, adding that the Herfindahl index — that the sum of the squares of the 'market shares' of the various projects in the portfolio — of USAID, however, stood at 0.14, which means the portfolio is very fragmented. "If the result is close to one, the portfolio is very concentrated, according to the Herfindahl index."
Nepal is heavily dependent on foreign aid for development expenses as the country's resource is not enough for recurrent expenditures.
Total foreign aid represented 5.8 per cent of the country's Gross Domestic Product (GDP) in fiscal year 2010-11, though the country is trying to shift its aid policy to aid for trade to strengthen the country's competitive and comparative advantages along with creating employment opportunities in the country.
Due to the lack of a clear foreign aid policy on creating employment through developing entrepreneurship in the sectors that have competitive and comparative advantages in the country, some 530,805 youths migrated in search of greener pastures mostly to the Gulf and Malaysia in the last fiscal year.


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