Nepal to tap promising trade potential, UNDP and Government launch million-dollar project

Jun 30, 2006

imageNepal to tap promising trade potential, UNDP and Government launch million-dollar project


29 June, 2006 Kathmandu-Conflict, poor infrastructure, a narrow range of exports, and slow customs procedures have severely limited Nepal's share of global exports (0.02%). Through a million-dollar project launched in Kathmandu earlier today, the Government and the United Nations Development Programme (UNDP) plan to boost the nation's share of international business.

'As Nepal embarks on its peace process, a trade strategy that fosters growth in jobs and key sectors like agriculture could significantly rejuvenate an economy battered by conflict,' said UNDP Resident Representative Matthew Kahane.

Under the newly launched project, the Government and UNDP will explore Nepal's trade potential in three promising new areas: education, health, and high-end retail services. According to a new regional report'also launched today by UNDP'developing countries need to carve out their own niche to succeed in the highly competitive world of global trade; but it is crucial that agriculture is not left behind.

The new Asia-Pacific Human Development Report: Trade on Human Terms, which charts trade's impact on progress in the region, concludes that in most developing countries a greater engagement with international markets has been accompanied by a rise in income inequality.

'Inequality is at root of Nepal's conflict. Therefore it is crucial that Nepal doesn't follow the trend we have seen in other countries. We should view trade as a means for achieving human development, rather than an end in itself. In a country where most people rely on farming, a trade strategy based on human development has to have agriculture at its core,' Mr. Kahane said.

A recent study on industrial development confirmed that Nepal's core advantages still lie in agricultural products like: dried vegetable, spices and leather'with most exports going to India. Under the new project, the Government and UNDP plan to help producers boost their ability to compete internationally with these products by improving transport links, customs services and quality testing facilities.

The private sector is critical to making this effort work, Mr. Kahane said, and the project seeks to expand government's engagement with the private sector on developing the country's trade potential. At the same time, the project will help to build institutional capacities to analyse the content and impact of trade policies, which will feed directly into national planning and the positions taken by Nepal during international trade negotiations.

The final of the new project's five components seeks to assist Nepal assess its investment climate, and recommend ways of fostering more foreign investment. ENDS'

Note to editors:

-Since 1997 UNDP has supported initiatives aimed at opening up trade opportunities for Nepal. Most recently UNDP assisted Nepal's World Trade Organisation (WTO) negotiation team to successfully lobby for Nepal to become the first LDC member.

-Today, just over 30 percent of Nepal's people live below the national poverty line. Lack of employment opportunities is considered a major constraint to reducing poverty. Trade has the potential to create opportunities if the labour intensive agriculture sector is not left behind.

Contact Information

For further information please contact: Lisa Hiller (+977-1 5523200 ext: 1060, mob: +977 98510 12133), or Sangita Khadka (+977-1 5523200 ext: 1077, mob: +977 98510 81114).