Govt liberal to foreign investors: PM

Post Report

KATHMANDU, Feb 4 - Prime Minister Girija Prasad Koirala has said that more open and liberal situation to investors has been created by the trade and foreign investment policy. Procedures under export/import regime have been simplified and tariffs rates rationalized. So, the attempts to offer concession and incentives, as much possible, to the foreign investors will continue, he said.

Inaugurating the Fifth South Asian Economic Cooperation Conference on ‘Government-Private Sector Partnership: A Strategic Alliance for 2010’ here today, Premier Koirala said SAARC Chamber of Commerce and Industry (SCCI) has become a good platform to enhance intra-regional trade; leading to increased production, investment and joint ventures.

"Government-private partnership has become a thrust for development after the restoration of democracy in Nepal, and better economic policies have seen the private sector as an engine to accelerate the economic, social and the cultural development in the country", PM Koirala said.

Secretary General of South Asian Association for Regional Cooperation (SAARC) Nihal Rodrigo said the strategic alliance between government and private sector is related in many respects to the larger global impact. But, the two sector are often seen as two exclusive, even adversarial groups with different agenda, ethics and methods.

However, all South Asian governments have indeed declared their commitment to accountability and transparency. They are committed to carrying out their manifestoes and declared policies. The state has been moving away from its all pervasive role of 50 years’ ago, he said.

The private sector’s stake in the economy is getting more extensive. Poverty alleviation and rapid social upliftment requires a multi-dimensional, sustained effort which is not possible from either the government or the private sector alone, he said.

Although, the SCCI has contributed to the SAARC position, a sustained interaction on a regular basis with trade and industry representatives is not yet part of the national negotiating culture of South Asia, the secretary general observed.

Pradeep Kumar Shrestha, President of Federation of Nepalese Chambers of Commerce and Industry (FNCCI) said partnership should not be confined to one government and the private sector. As international agreements and negotiations made by the governments have direct impacts on business, the governments should inform the private sector what they are planning to do at the international level, he stressed.

The SCCI has been quite forceful in promoting the idea of South Asian Preferential Trade Arrangement (SAPTA) and South Asian Free Trade Area (SAFTA) and has been quite supportive of the idea of increased regional trade and investment on a preferential basis, Shrestha said.

Qasim Ibrahim, President of SCCI said there are a number of cross-sectoral issues relating to government-private sector partnership. However, there is a broad agreement that government should specialize in planning, structuring and regulation while the private sector should specialize in management, investment, construction and financing.

Long-term domestic financing sources must be developed and commercial risks should be assigned to the private sector but other risks should be assigned according to which party is able to mitigate, he added.

Padma Jyoti, vice-president of SCCI said government and the private sector should discuss critical issues and work out strategies for making progress towards achieving economic goals. Strike, violence, intolerance seem to be getting upperhand in our society and there is politicization of all sectors and issues within and between countries. By propagating the theme of partnership, we are trying to redress this shortcoming, he added.

The conference jointly organized by FNCCI and SCCI is being participated in by business leaders from Bangladesh, Bhutan, India, the Maldives, Nepal, Pakistan and Sri Lanka.

Economy, finance and market

By Supa Upadhyay

Domestic money market:

The Average Weighted Discount Rate of 91-day Treasury Bills (TBs) dipped by 6 basis points to 5.11 per cent compared to the previous week. The rupee was traded higher at 98.75 and lower at 98.73 for 91-day TBs. The NRB had received 41 bids worth NPR 2020 million against the notified amount of NPR 751 million for 91-day TBs. The Repo rate for member bank and institutions was called at 5.6067 for the period 30 Jan-05 Feb. In the regular weekly auction, the NRB is going to issue 91-day TBs worth NPR 670 million on February 6, 2001.

Domestic Capital Market:

A weakening trend prevailed in the stock market amid thin trading. It is noted that major trading scripts are quite expensive at the moment. The NEPSE Index-100 that opened higher at 468.41 from the previous week close of 467.37 declined in the consecutive days and eventually closed lower at 465.39 for the week, netting a modest loss of 1.98 points. This week, trading was estimated at 35,622 shares valued NPR 26.9 million compared to 50,028 shares valued NPR 48.9 million in the previous week. Commercial Banks and Finance Companies shared 83.42 per cent and 13.26 per cent of total traded amount. This week, the Index of Commercial Banks, Hotel Sector and Finance/Insurance Sector lost. Production Sector, Other Sector and Business Sector remained unchanged at their previous week price. This week, brokers had quoted the prices of 47 companies on the trading board but 40 companies were traded. Out of 40 traded companies, 11 companies improved, 18 lost and other 11 remained unchanged at their previous prices. Lumbini Finance and Leasing, Bank of Kathmandu and Nepal Industrial and Commercial (NIC) Bank registered the first, the second and the third most traded company trading 8120, 4840 and 4590 shares respectively. Shares of Nepal Bank Ltd., Nabil Bank, Indosuez Bank, Nepal Grindlays Bank, Himalayan Bank, Nepal SBI Bank, Nepal Bangladesh Bank, Bank of Kathmandu, NIC Bank, Necon Air, National Life and General Insurance, Alliance Insurance, NEFINSCO, Kathmandu Finance and Lumbini Finance and Leasing were traded in all four working days. Likewise, Everest Bank, Gorakhkali Rubber, Taragaon Regency Hotel, Harisiddhi Brick and Tile, Nepal Housing Development and Goodwill Finance were able to trade in three working days only.

Forex Round Up

This week, the foreign exchange market reacted immediately on FOMC announcement to cut Fed rate by 50 basis points. It was the first time since 1984 that the Fed cut rates by a full point within a month. Fed chairman said the current rate cuts should support growth of the economy over time. The USD lost significantly against all its major trading partners after knee jerk selling of the dollar. After the Fed rate cut the GBP got good buying opportunities as the fundamentals of the UK economy remained sound. The Yen appreciated rapidly as the market rushed to lock in some of the profits made over the past few weeks. The INR improved sharply against the dollar over the week on good dollar supplies from foreign custodian banks as well as financial institution while the NPR remained stable during the week.

Nepal participates in CMT Fair

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KATHMANDU, Feb 4 - Nepal participated at the Caravan Motor Tourism Fair (CMT Fair) held in Stuttgart, Germany from Jan 20-28, states a press release issued by Nepal-German Chamber of Commerce and Industry (NGCCI) here today.

This is the eighth time that Nepal participated in the annual event, which takes place each year at the beginning of the tourism season in Germany. Nepal had been a Partner Country at the fair in 1995.

Almost 70,000 tourists visited Nepal’s Pagoda-styled stand at the most important Travel Fair for Nepal Tourism Promotion in Germany. Nearly 30,000 German tourists visited Nepal between 1990-2000, says the release.

Visitors to the fair showed keen interest on how tourist destinations are dealing with environmental advantages and disadvantages of tourism, the release states.

During the fair, NGCCI delegation also held talks with German counterparts in further expanding bi-lateral trade, new investments and joint-ventures, especially in exploiting Nepal’s vast hydropower and tourism potentialities.

NGCCI, Nepal Tourism Board, private operators and the Nepalese Consulate General in Stuttgart jointly supported Nepal’s participation at the fair.