Editorial

Donor's Due

Evaluation of the donors by the Nepalis is characterized by two types of extremism. They are either praised wholeheartedly for their pious contribution or criticized severely blaming them for all sorts of problems, economic or otherwise, besetting the country.

The malaise can however be attributed to a large extent to the donors themselves. Their representatives can often be found sermonizing the naïve Nepalis even on topics that should be beyond their field of activity. They have seldom tried to explain their exact position when controversies arise on the issues attributing to their certain aid conditionalities.

A very fundamental point needs to be understood by the critics. The World Bank, the IMF and the ADB are not charity organizations guided simply by the motive to develop Nepal and help the poor Nepalis. They are organizations run primarily by the professionals whose one of the primary motives is to improve their career. For this they have to operate according to the wish of their superiors who have a detrimental role in the career advancement of these professionals, not simply according to the wish of the Nepalis.

The same logic applies also in case of the INGOs that proclaim to be doing charity in Nepal, but in reality operate according to the wish of their superiors in their headquarters who in turn have to operate according to the agenda set by their own donors.

No one can come up with the example of a country developed solely with the donor assistance. If any country has developed with foreign assistance, the role of the country’s leadership is the paramount one. The donors have only ‘assisted’. But in Nepal’s case, the country’s leadership seems to be led by the donors (read the professionals in the donor organizations). Those competent Nepali professionals can be found lured more by the prospect of getting a job in the donor organization after they retire from the country’s government job. So they seem to be trying to please the professionals in the donor organizations by following their policy prescriptions instead of trying to develop purely Nepali agenda for all the donor assistance. The dependency theorists seem to be right in this regard.

The donors have to be regarded just as the banking institutions who lend you the money for specific projects with the expectation that you will be able to return both the principal and interest in time. Though the bank evaluates the project before handing over the money, both of the project design and its profitable operation is solely the responsibility of the borrower.

If this concept is clear, no one needs to criticize the World Bank or ADB for the price hike in the electricity or water. No sensible person would be inclined to think that a lender would force a borrower to increase the price of the product if the customers seem unable to afford it. His only interest is to see that the borrower’s firm maintains a sound financial position measured in a number of financial ratios. Whether that is achieved through price hike, by cost cutting or by reducing the intermediary margin is not the concern of the financier.

Send your feedback to the editor: bizline@mos.com.np  
2004 © Mercantile Communications Pvt. Ltd. P.O. Box 876, Durbar Marg, Kathmandu, NEPAL. Tel : 977 1 220 773, 243 566 . Fax: 977 1 225 407. Reproduction in any form is prohibited without prior permission. No part of the articles which appear in the internet version on NEW BUSINESS AGE may be reproduced without the permission of Mercantile Communications Pvt. Ltd. For reprinting rights, please write to us.  Send us your feedback : contact us.