For a country like Nepal, with perhaps one third of its workforce or more abroad, migration is an underrated challenge and also an opportunity, said Ambassador of Germany to Nepal, H.E. Mr. Roland Schäfer.

In an exclusive interview with UNDP in Nepal, Mr. Schäfer said the Government of Nepal has the opportunity to work together with national and international development partners, including the labour recipient countries, in building capacity of its workforce so that they could secure better jobs within and outside Nepal.

“Professional training would give an opportunity to returnee migrants as well and establish a quality oriented industry,” said the ambassador adding that Nepal could learn from the German model of professional training in which the industry takes the lead.

German industry, he said, invests roughly Euro 27 billion every year in public training and only five billion come from the German Government. “German industries train the young people for their own business so that they are exactly right for the job when the training is finished. And they train them on the shopfloor; only part of the training is imparted in schools. To work on this issue with enlightened industrialists in Nepal and of course the government, he said, is one of the areas of interest for the Embassy in Nepal.

Government data shows that nearly 75 per cent of the Nepali migrant workers going abroad are unskilled. Many of them are therefore forced to take up menial and low-paying jobs in precarious conditions. Skilling the Nepali workforce would go a long way in not just improving their job prospects abroad but also within the country.

In the wake of COVID-19, tens of thousand of Nepalis have lost their jobs abroad and are returning to Nepal. On top of this is the existing unemployment within the country, which has worsened after the lockdown. However, irrespective of the rate of unemployment, the demand side continues to face a serious crunch of skilled workforce in Nepal.

The ambassador said that UNDP, as a global organization, could take work on bringing together the government, development partners and other UN agencies to collaborate for joint initiatives on migration. “Migration is a global issue, and UNDP, as a global institution should be able to work with ILO and other institutions and make this a global issue. I don’t think Nepal will be able to handle the issue of migration just by itself, nor any other partner. Many need to be involved, also recipient countries. As a global partner, UNDP can bring something to the country,” said Schäfer.

Highlighting the on-going Germany-UNDP cooperation in the context of COVID-19, the Ambassador said, “Together we are working in different sectors like governance, green recovery and social protection. We agree on the big thematic orientations. But we have to intensify our work to find out what really works on the ground. We can be partners, but it is for the Nepali Government to take the political decisions and explain them to the citizen.”

Germany has long been supporting Nepal in the hours of need. As a partner during the pandemic, the Ambassador said, Germany has announced to offer 10 million euro additional grants for the strengthening of the health system in the context of COVID-19.

Nepal should lower the threshold to attract FDI

The ambassador also urged the government to decrease the current threshold for foreign direct investment from 50 million to 5 million rupees. Adjusting the FDI threshold, he said, would be one of the key reforms Nepal can make to pave the way for its speedy development.

“It would send a huge signal outside,” he said. Only last year, the Government of Nepal increased the minimum threshold from 5 million to 50 million rupees. “I think that is a mistake,” he said. “All donors, including the United Nations have urged the Nepal to reconsider this. I would urge it again. This is not a big issue but it’s a huge signal because you have so many small investors who come with exactly between $5 to $50 million and to try out something new. And to look where the niches are for Nepali industry. All these are small investments and they can grow. But if you make the threshold so high, you are sending the wrong signal. All these laws, which Nepal has rightly introduced to encourage foreign investment, are not working if you give, at the same time, that signal.”

Interview