Poverty alleviation major goal: FM

Post Report

KATHMANDU, May 12 - Minister of Finance Dr Ram Sharan Mahat has said that alleviating poverty by maintaining sound macroeconomic fundamentals has been the overarching goal of the government. He also reiterated the commitment to continue the reform process to create sustaining and predictable macro economic framework.

According to a press release reieved here, addressing the Thirty-fourth Annual Meeting of Asian Development Bank in Hawaii, USA as the Board of Governor, Minister Mahat informed the gathering that government is soon coming with a new plan of action to support and enhance role of private sector in the economy. Stressing upon the need to speed up the financial sector reform, he said that the management of the two largest banks is soon going to be handed to private sector to recuperate the financial health of the banks and said that regulatory role of Nepal Rastra Bank would be strengthen.

He further said that government is determined to implement the suggestions of the Public Expenditure Review Committee phase wise and added that the recent merger of VAT department and Tax department is one of the crucial steps taken in that direction.

Referring to the various common problems of under developed countries Minister Mahat underlined that the main challenge of any under developed economy is the sharp growth in public expenditure, security expenses and debt-servicing obligations due to which these economies are facing serious fiscal problems. "These emerging problems have severely constrained the government capacity to provide greater resources for much needed infrastructure and social investment," Mahat said.

Expressing concern over slow down of American and Japanese economies, Minister Mahat said long persisting of such situation for a long time would deeply affect the regional economy since these markets are the biggest export markets of the developing countries.

Dr Mahat, on the occasion also appreciated ADB for preparing long-term Strategic Framework for carrying out its Poverty Reduction Strategy in the next 15 years and expressed the hope that such steps would be helpful in fighting against poverty in the region.

Minister Mahat today met with Tadao Chino, President of ADB and discussed various matters of mutual interests and briefed him on various ongoing economic programs in Nepal. During the discussion, Minister Mahat appreciated the role of ADB in development activities and urged to concentrate on programs related with poverty reduction. On the occasion, President Chino assured that the role of ADB will be always co-operative and informed him that bank would expand cooperation in days to come.

Nepse index falls yet again, stability questionnable

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KATHMANDU, May 13 - Plagued by the continuing slump of share prices of the commercial banks, the money market dived again by more than 9 points raising a serious question on the sustainability of the share market.

The Nepal Stock Exchange(Nepse), during last week’s transaction also witnessed similar decline of over 3 points whereas the market had slipped by more than 7 points two weeks ago.

According to the weekly share information issued by Nepse, the opening index on the first day of trading on Monday was 364.63 points, which dived to touch 355.60 at the end day of trading on Friday.

On the group wise basis, the indices of commercial bank group, insurance and finance group and other group declined during the last week’s transaction. However, the indices of processing and manufacturing group and trading group surged while the index of hotel group remained unchanged.

The index of commercial banks, which has been commanding the largest share in the Nepalese money market, recorded a huge tumble of over 14 points and remained at to 389.54 points from 403.73 points to touch the lowest mark in recent months.

Similarly, the index of finance and insurance group, which has become the second largest group in terms of participation in the share transaction, also continued to demonstrate similar slump of over 4 points and remained at 325.30 from 329.46 points. The group’s index, last week had also faced marginal slump to remain at 330.17 points from 332.51 points.

The downward trend of the indices also witnessed in the index of other group with a slump of over 10 points to remain at 195.75 from 205.54 points. The group wise index for hotel group remained unchanged during the weekly transactions and remained at 299.83 points.

However, the indices of manufacturing and processing group and trading group surged during the last week transaction on the Nepse floor. The index of manufacturing and processing group soared by over 2 points to touch at 339.84 points from 337.14 points. Similarly albeit nominal, swell was also recorded for trading group which climbed to 119.78 from 117.18 points.

Along with the slump in the share prices of commercial bank and Nepse index, the participation of commercial banks in the total transaction continued to remain below the normal range. Despite the remarkable surge in the participation last week, its participation, this week, again slipped and captured only 60 per cent of the total transaction against 79.02 per cent last week. Just a few weeks ago commercial banks used to captured a hefty share of 90 per cent.

The participation of finance group increased considerably again and captured 24.22 per cent of the total transaction. Its participation during last week had remained 17.05 per cent down from 38.03 per cent recorded two weeks ago. Similarly, the participation of manufacturing and processing group’s participation, during this week’s transaction, swelled to touch 3.52 from last week’s 0.17 per cent. In the same way, the participation of insurance group, trading group and other group stood at 3.05 per cent, 6.32 per cent and 0.39 per cent respectively.

Along with the slump in the Nepse index, the volume and value of transaction also dived this week. During this week’s transaction, a total of 35,757 units of shares valued at Rs 14.5 million were transacted in 541 transactions. The Nepse floor, last week, has witnessed total 710 transactions in which a total of 41,304 shares valued at Rs 34.8 million were traded.

During the transaction this week, fifty-five companies had quoted their price for trading, out of which, shares of forty companies were traded. Nepse, during last week, remained open only for four days.

Companies, whose shares were traded for four days this week, include Nepal Bank Limited (Rs 407 - 401), Nepal Arab Bank (Rs 1,525 - 1,480), Himalayan Bank (Rs 1,495 - 1,450), Nepal Bangladesh Bank (Rs 1,220 - 1,150), Bank of Kathmandu (Rs 1,000 - 940) and NIC Bank (Rs 460 -435).

Similarly, other companies were Taragoun Regency Hotel (Rs 101 - unchanged), Himalayan General Insurance (Rs 290 - 285), Kathmandu Finance Company (Rs 315 - 312), Universal Finance and Capital markets (Rs 175 - unchanged), Sagarmatha Insurance (Rs 210 - 212) and Lumbini Finance and Leasing (Rs 240 - 235).

Other Companies whose shares were traded only for three days are Nepal Grindlays Bank (Rs 2100 - unchanged), Everest Bank Limited (Rs 835 - 775), Necon Air (Rs 133 - 125), Nepal Film Development Corporation (Rs 77 - 75), NIDC Capital Markets (Rs 600 - 580), Annapurna Finance (Rs 425 - 440), Citizen Investment Fund (Rs 175 - unchanged), HISEF (250-245) and Ace Finance (Rs 560 -unchanged).

Similar, other companies with transactions in only one day during this week were Bishal Bazar Company (500/900,000), Premier Insurance (Rs 10/2,300), People’s Finance (20/5,800) Alliance Insurance (30/4,800), Nepal Housing and Merchant Finance (20/5,540), Latitpur Finance (30/15,000) and Nepal Welfare Company (10/900).