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| Kathmandu, Monday March 03, 2003 Falgun 19, 2059. |
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‘WTO
membership will raise growth’
Post Report
KATHMANDU, March 2 :
Participants in a discussion programme today expressed the views that Nepal’s
membership to the World Trade Organisation (WTO) is not an end, rather a means to achieve
an accelerated growth through greater trade.
"The need to join
WTO is based on the notion that it will minimise losses, if not maximise gains," said
Dr Yuba Raj Khatiwada, member of National Planning Commission (NPC).
He also added that the
WTO membership would ensure that state business-related and other policies in other
trading countries would become more predictable, which can come as a big incentive for
trade and investment.
Dr Khatiwada, among
other participants, was speaking on the occasion of the second monthly forum on
globalisation and WTO held on ‘Services Liberalisation in the Context of Nepal’s
Accession to the WTO."
The programme was
jointly organised by South Asia Watch on Trade, Economics and Environment (SAWTEE) and
Action-Aid.
Stressing that
Nepal’s service sector may need certain degree of protection because many of them
have developed late, he said that proper sequencing is a must in the liberalisation of the
sector to avoid any adverse impact.
He further emphasised
that opening up of some of the service sectors would prove beneficial to Nepal, especially
in the form of inflow in foreign direct investment.
Likewise, prominent
economist and former member of the NPC Dr Minendra Rijal said that the service sector,
with a contribution of 40 per cent to the Gross Domestic Product (GDP), constitutes the
backbone of the country’s economy.
He stressed that Nepal
must strongly negotiate with its trading partners to obtain the benefits that the WTO in
principle had promised. Such an emphasis comes in the light of the fact that Nepal is
presently negotiating with different countries for its accession into the WTO.
"How do we open
the service sectors? How do we protect investors, domestic industries as well as
consumers? – These are some pertinent questions that need to be clearly answered
before service sectors are opened," said Dr Rijal.
Stating that the need
to clearly identify the comparative advantage that Nepal enjoys at the global level need
not be highlighted, he said that such an advantage at the regional level too needs to be
analysed.
Likewise, Prachanda Man
Shrestha, Chief at the WTO Cell at the Ministry of Industry, Commerce and Supplies, said
that Nepal’s service sector is comparatively already more liberal in the South Asian
region.
Nonetheless, he said
that the opening up of the service sector is being pursued only with conditional
commitments. "Nepal has adopted a trade off strategy in its accession process,"
Shrestha added.
In addition, Posh Raj
Pandey, Programme Manager at Nepal Accession to WTO, highlighted the difficulties in
determining the national policy objectives and supply constraints.
He said that Nepal
lacks skilled human resources and the awareness about potential comparative advantages.
Furthermore, he added that complexity in identifying concrete trading interests and lack
of adequate understanding of General Agreement on Trade and Services (GATS) has also posed
problems.
Rajendra Khetan, second
vice president of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI),
said that Nepal should open sectors that are still barren for Nepal. However, he stressed,
"a level playing field for foreign and domestic players must be ensured."
Enumerating areas that
Nepal can open up for foreign companies and investors, Khetan cautioned that ‘a
careful balance of protection and opening-up of sectors is a must.’
He further said that in
the context of Nepal’s impending membership to the WTO, the government needs to
update and upgrade various regulations. "The government has fallen behind in this
area," he said.
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