New Prescription To Fight Poverty

-By Our Correspondent

The world needs a fresh approach to fight global poverty after the old prescriptions - good economic policies and growth - were found inadequate to fight poverty.

"The missing link between poverty and its reduction in scores of developing countries and transition economies has now been identified as responsive and accountable governance institutions." This is one of the main conclusions of the UNDP’s new report on Poverty: Overcoming Human Poverty.

A drift in the agenda has come after it was found that genuine action plans to end poverty remained ineffective and poverty again begun rise especially in the last five years after the World Social Summit in 1995.

The Report was launched worldwide on April 4, coinciding with the run up to the World Social Summit Day + 5 to be held in June this year, at which countries will review progress made in poverty reduction in the last five years.

The report has noted that even when a country gets is poverty reduction policies right, "inept or unresponsive governance can nullify the impact."

The report maintains that the ‘bottom-line’ requirement for reducing poverty in any country is to have a government that is accountable to people. "Democracy alone is not a ‘vaccination’ against poverty, although it can bolster accountability... If people want to represent their interests, they also have to hold officials to account between elections… (otherwise) democracy can be locked up and carted away with the ballot boxes after each election," it states.

The report argues that holding government officials accountable is a key function for civil society organisations, ranging from community self-help groups to trade unions and political parties.

The authors of the Report claims fighting poverty should be a two-prong approach with the ‘non poor’ giving their support to the campaign and, more importantly, the poor be sufficiently organised to demand it.

The Report has emphasised on a new global strategy with more resources, a sharper focus and a stronger commitment with programmes which are more pro-poor, target inequality and emphasis on empowering and organising the poor.

However, the Report has pointed out that the donor countries are cutting back on aid (see box) and failing to focus what remains on poverty.

A major shortcoming of the current anti-poverty planning, the Report says, is the lack of achievable time-bound goals and targets. Referring to the current trend of the external donors providing much of the funding outside regular government channels for individual project, the Report says the anti-poverty plans should be nationally owned and determined and not donor driven.

In Nepal’s case, the report has mentioned that 50 per cent of the Nepalese have a income of less than a dollar, a reference of increasing poverty in Nepal in recent years. A government data of 1996 had said that the percentage of people living below the poverty line as 40.

Releasing the Report in Nepal on Tuesday, member of the National Planning Commission Dr. Jagadish Pokharel said Nepal needs to have a pretty tough job of achieving an annual growth rate of 10 per cent in the remaining period of the 9th plan and during the 10th plan to get rid of poverty. This year Nepal expects a growth rate of 6 per cent mainly because of the good signs in the agriculture sector, still far below the required growth rate.

Meanwhile, the Asian Development Bank, in its annual Outlook report on South Asia, has seen some encouraging sign of growth in Nepal. "A recovery in agriculture production has improved Nepal’s ‘short-term’ economic prospect," the report has said. But, it has warned, that major challenges remain.

"If Nepal is to achieve the levels of sustained growth necessary to lift it out of poverty, the government needs to take advantage of its majority position to pursue broad-based reform agenda, with financial sector reform and civil service reform at the core," the ADB has suggested.

Campaign For Conservation

-By BMD

In view of making heritage conservation activities more effective and result-oriented, Nepal Heritage Society (NHS) has started "One School One Heritage Campaign". Launched from the World Heritage Day (April 11), the campaign aims at encouraging and assisting schools to preserve, build and manage heritage (both natural and cultural) in their vicinities by mobilising the students.

In the initial phase, the non-governmental organisation devoted to the task of heritage conservation will launch the campaign inside the Kathmandu Valley to mobilise over 2000 high schools. NHS plans to expand the programme to around 4,000 government high schools across the country gradually.

Highlighting the objective of ‘One School One Heritage Campaign’, Shridhar Shumshere J. B. Rana, President of NHS, said the programme would help generate awareness about heritage conservation among people from the younger generations.

"Unless the local residents are not alert about the importance and value of heritage, it will be a very difficult task to conserve them".

Rana was of the opinion that the present situation of heritage preservation has not been up to the mark. He also said the government has also failed to conserve the heritage sites and monuments lying in different parts of the country in a proper manner.

Ram Prasad Kadel, NHS executive member, said the campaign would be launched in schools with the help of school management, local scout groups and Junior Red Cross to make it successful.

Kadel said the letters have been sent to all the high schools in the Kathmandu Valley to form ‘heritage groups’ in them.

"We have wanted to make the students feel that the local heritage are their own properties. Once they start conserving such sites, the local people will also know that conserving heritage is essential."

He also said we have to show that a small effort of the local communities will contribute a lot to the conservation activities.

"We have also to show that we can do something important in the conservation sector without taking donations from foreign countries," he said.

Nepal is considered to be one of the richest countries in terms of natural and cultural heritage in the world. In this Himalayan Kingdom, there are ten UNESCO’s World Heritage Sites that include the Kathmandu Durbar Square, Patan Durbar Square, Bhaktapur Durbar square, Changunarayan, Pashupatinath, Bouddhanath, Swayambhunath, Lumbini, Royal Chitwan National Park and Royal Sagarmatha National Park.

The Kathmandu Valley alone has around 2200 antique cultural and historical monuments which are of high touristic value. It is believed that more than 100,000 tourists from around the world visit the Valley each year to see its monuments and heritage sites.

But UNESCO has been saying that Nepal has not been able to carry out the heritage conservation activities as per its standard. It has already warned the government that it would exclude the heritage sites in Nepal from the list of World Heritage Sites.

However, Sani Maiya Rana, Deputy Director General at the Department of Archaeology, said that the Department has been identifying the heritage of international, national and local importance for their protection and conservation.

Experts in heritage conservation say that the heritage preservation works have not been carried out in an effective way in Nepal. They say, for example, it would be a blunder to use cement while renovating the monuments.

Mohan Prasad Khanal, Associate Professor at CNAS, TU, said cement is often used in conservation works. "It makes more like reconstructing, rather than conserving, them," he said.

"Using cement is considered a crime to renovate the monuments and heritage from the point of view of archaeology. Cement is not durable and it can adversely affect the monuments," Khanal said.

Khanal said that Vajra (a mixture of lime and brick) should be used while renovating any monument. He said although the concerned authorities are aware about the negative effect of the use of cement, they use it to save the expenditure.

What may be more unfortunate is that tiles, used in bathrooms and toilets, have been used in temples and shrines.

He said the haphazard use of chemicals in the monuments is also against the principle of archaeology.

He said the use of colours like vermilion and also offering sweets can destroy the monuments.

Why Nepal Is Failing To Attract FDI

-By Krishna Shrestha

Despite efforts Nepal has achieved little in foreign direct investment compared to other countries. This has raised a serious question, about why foreign investors are balking to come to Nepal or whether Nepal is not attractive for foreign investors?

But there are some features that show priority has been accorded to attract foreign investment in Nepal. His Majesty’s Government has clearly stated that foreign investment has been recognised as a major economic instrument for the economic development of the country.

The Foreign Investment and Technology Transfer Act, 1992 and Industrial Enterprises Act, 1992 acts guarantee for the equitable treatment to both Nepalese as well as foreign investors.

According to the acts, foreign investors can invest up to 100 per cent equity shareholding, registration and licensing procedures are being simplified, foreign investment is open in every sector barring a few exceptions. and technology transfer is allowed in all types of industries.

The Foreign Investment and Technology Transfer Act, 1992 guarantees the repatriation of the dividend and the capital. Nepalese laws also guarantees against nationalisation of industries. And, there is a list of incentives provided to investors. Hydropower, telecommunication, computer software and hardware assembling and tourism are some of the areas identified suitable and attractive for foreign investors.

Despite all these things, the picture is gloomy. A latest figure released by United Nations Trade and Development shows that Nepal’s share in the overall foreign direct investment inflows in Asia and the Pacific is negligible.

During the period of 1991 to 1998, the total foreign direct investment (FDI) inflows to Asia and the Pacific had recorded to 121.435 billion dollars. The FDI inflows to Nepal during the same period was recorded to be only 18 million dollars. This is the lowest figure among SAARC member countries except Bhutan. The figures for Bhutan has not been given.(see table)

The Asia and the Pacific region have emerged as one of the most dynamic regions for the foreign direct investment in the world during the past decade.

Quoting UNCTAD’s series of Investment Directories, between late 1980s and the late 1990s, the annual average FDI flows to the regions quintupled, going from just under US$ 16 billion to slightly more than US $ 80 billion in about 10 years.

"The region’s share in world annual average flows doubled, from nine per cent to 18 per cent, while its share of flows to developing countries remained more or less stable," says UNCTAD.

In 1998, in the wake of the financial crisis, FDI inflows into the region registered their first decline in 13 years, but preliminary estimates suggest that in 1999, FDI flows held steady, with a one per cent increase, says UNCTAD.

UNCTAD record clearly states that the FDI in South Asia grew by a multiple of 15 over the decade. The growth is mainly a function of the gradual opening by India, the largest country in the sub region, for foreign investors. The average flows to India at the end of the 1980s was negligible but it stood at US $ 2.7 million in the late 1990s.

But it seems that Nepal has been unable to catch the bus. Even Vietnam, once a war-torn country, succeeded in attracting US$ 2337.5 million in foreign direct investment at the end of the 1990s. among the other South Asian countries, Indian succeeded in attracting US $ 2,695.4 million; Pakistan US $ 725.1 million; even Sri Lanka, supposed to be ravaged by civil war, succeeded in attracting US $ 199.8 million in FDI.

This reality point that Nepal needs to rethink about her foreign investment policy and its efforts to attract foreign investors and the overall investment environment of the country also needs to be reviewed.

The basic questions that need to be answered are: what is our competitive strength? Is country’s economic diplomacy as announced by the ministers and senior government officials time and again working? Is there any responsible body in the country that looks after promoting foreign investment inflows in the country? Are all the investors genuine? Have we been succeeded in tapping prominent investors of the world? Why there is big flow of foreign investment in India and China, both neighbouring countries, and why Nepal has failed to benefit from it.?

However, the irony is that the government officials seem happy over the trickling of foreign investors in various projects.

But, is the situation encouraging? At least, UNCTAD figure does not support it. Besides, the policy makers need to review present status of the project initiated with foreign collaboration. In the last one or two decades, many foreign joint ventures have closed down. Some did not run their business even after collecting money from local people.