ecofin nepal

8/12/2019 Ecofin Nepal

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ECOFIN

NEPALS POSITION PAPER

TOPIC A

Delegates: Sebastian Hernndez, Ernesto Lanos

History

A landlocked country, nestled in Central Southern Asia, Nepal is situated in the

southern border o the great Hi!alayan "ountain #ange$ A !onarchy throughout all o

its history, Nepal %as ruled by the#ana a!ily or o&er a hundred years$ 'n ()*(, a

constitutional !onarchy %as put in place$ 'n ()*), +ing "ahendra issued Nepals irst

constitution %hich called or the or!ation o a bica!eral parlia!ent %hose lo%er

house %as elected by direct &ote$

-pon o&erthro%ing Nepal.s irst de!ocratic go&ern!ent in ()/0, the king disbanded

the council o !inistries and the parlia!ent, banned the or!ation o political parties

and issued another constitution %hich restored the kings po%ers$ 1ased on the

2Panchayat 3a or! o local sel4go&ern!ent5, the 6ri!e "inister %as appointed by the

+ing$

6ublic de!onstrations, ci&il %ar, riots and guerrillas %hich sought to end dictatorship

%aged or thirty years$ 'n ())0 the +ing lited the ban on political parties, dissol&ed the

2Panchayat andackno%ledged Nepal Co!!unist 6arty$ During that sa!e year a ne%

political constitution %as adopted$ -nder such, a !ulti parlia!ent took seat$


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Nepal.s current constitution cites the country as a constitutional !onarchy, ha&ing a

bica!eral parlia!ent to %hich the king belonged$ 7he House o #epresentati&es is

!ade o 80* !e!bers elected by uni&ersal surage 3o&er (9 years old5 or a i&e4year

period$ 7he National Asse!bly is !ade o /0 !e!bers$ hen dee!ed necessary and

pre&iously appro&ed by the House o #epresentati&es, the king could declare a state o

e!ergency$ 7he country.s ;udicial branch co!prises the Supre!e Court$

7HE C0900 k!8$ (?/900 correspond to land and >000 to lakes

1orders: 8)8/ k! o %hich (8?/ are shared %ith China@ (/)0 %ith 'ndia

Natural e&ents: 6ending the arri&al o !onsoon season, its intensity and duration the

country is prone to stor!s, loods, landslides, se&ere droughts and a!ines

Land use: (B o the countrys land is arable@ there are no per!anent crops@ >8B o

the land is !ostly %oods$ ( deaths per (000 inhabitants


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Child death rate: *$)? per (000 ne%borns

Lie epectancy: *$9>B on a&erage$ *9$? years o age or !en and *$?* years o age

or e!ales$

Literacy: 0$)B o %o!en are

literate as o esti!ations o 800)

Ethnicity: 7he country has o&er ?0 ethnic populations, a!ongst %hich Ne%ars, Hindi,

7ibetans, urungs and Serpas are the !ost i!portant ones

#eligions: 8B

orkorce distribution: Agriculture is the !ain occupation in Nepal, taking 9(B o the

%orkorce@ ser&ices, (/B$ Nepals !ost i!portant industrial sectors are: touris!, rice,


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sugar, ;ute goods, carpets, clothing and leather goods$ All together, these sectors take

?B o the country.s %orkorce distribution$

Eternal Debt: F 8*00000000 -S

As !entioned abo&e and upon ter!inating its internal ar!ed conlict, Nepal is

no%adays a country %ith poor inrastructure, lacking land, air and sea transportation,

schools, hospitals and electriication net%orks$ 1esides ha&ing landlocked, the country

is considered to be a de&eloping one$

7HE 6#


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De&eloping inrastructure in the said countries is a !ust, being that it represents the

o&erall set o ser&ices and !echanis!s considered &ital to run a country properly$

China.s situation clearly illustrates the abo&e!entioned situation$ 6resently, ehibiting

lo% in&esting rates due to inancial restraint !easures in industry as %ell as

o&ercapacity, China.s 6ri!e "inister en Gia41ao allotted F -S /00 !illion or Nepal.s

inrastructure in households and roads in 800)$ 'n 80(8, the allot!ent %as reduced in

hal$

'n this contet, a 8$>B orld ross 6roduct gro%th is epected or 80(8$ 7he esti!ated

gro%th rate or 80(> reaches ?$8B$

3raph (5

#ando! situations such as %orld%ide une!ploy!ent crisis, %hich reached (8B in the

Euro zone during 80(8, 9B in the -nited States and *B in Gapan(, also account or the

esti!ated gro%th rate o orld ross 6roduct

3raph 85

1Naciones Unidas sobre la base de datos de la OIT y el FMI/situacin y perspectivasde la economa mundial 201


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All o the abo&e, has a sensible i!pact in de&eloping countries and %ill produce a iscal

slo%do%n regarding in&est!ents in building road net%orks, hospitals, schools , %hich

are &ital to epedite progress to%ards i!ple!enting "illenniu! De&eloping oals

3"D5, to %hich all o us co!!itted$ 7his co!!it!ent is especially rele&ant or

de&eloping countries, %hich are highly &ulnerable to &ariations in the prices o ra%

!aterials$ 7hese countries are also recipients o less de&elop!ent assistance due to the

se&ere iscal restraints in donor countries$

Colo!bias case illustrates this point$ Colo!bia is a country located in South A!erica,

notorious or its internal ar!ed conlict$ Colo!bia.s lo%er eports %ere around F($(

000 !illion, corresponding to /0$B o the country.s total eports during 80(0 and

80(($ Despite ha&ing a Iree 7rade Agree!ent %ith the -nited States, in 80(8 Colo!bia

eported )/ thousand !illion lo%ers$ Local in&est!ent in housing and healthcare

declined in 9$?B8

7he de&astating eects o the econo!ical crisis are not restrained to the Euro zone

alone$ Studies sho% that -nited States could ace a iscal cli, %hich %ould

i!!ediately bring substantial cut os in public ependitures or about F)9000 !illion

dollars in 80(? along %ith a F>*000 !illion dollar ta increase$

7his %ill cause the 80(?480(* iscal austerity policy to take >B o the ross Do!estic

6roduct$ 'n the ace o a iscal cli, global econo!ic gro%th %ill cut do%n in hal,

around ($8B in 80(?$ Ior 80(* global econo!ic gro%th is esti!ated to be 8$*B less

than 80(?.s, pro&iding e&idence or the loss o inrastructure in&est!ent around (B$

2!roe"port #olombia $$$%proe"port%com%co%sites/de&ault/'les/T(#)20#olombia


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'n the case o China, its output dropped during 80(8, due to the %eak de!and o

de&eloped econo!ies$ 'n&est!ent gro%th, once a contributing actor or *0B ross

Do!estic 6roduct.s increase in de&eloping countries, has slo%ed do%n$ 't does not

in&est in oreign inrastructure, as policies ha&e turned !ore restricti&e than they %ere *

years ago$ 7his !eans that China.s allied de&eloping countries 3i$e$: Nepal and

Jietna!5 %ill eperience a cu!ulati&e loss around ?B during 80(?480(*

3raph ?5

Ater briely depicting the current global econo!ic situation, it beco!es clear that

de&eloping countries still lag behind regarding the !ilestones set in the "illenniu!

De&eloping oals 3"D5$ e depend on oreign assistance$

'n an atte!pt to pro&ide the delegates present here, a clear understanding o the

procedures by %hich "D started to %ork in tande! %ith de&eloped countries in


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!issions that ha&e pro&ed ineecti&e, as a conseuence o the econo!ic crisis, ' %ill

cite a case$

'n Guly (?

th

, 800 7he European Council and the European 6arlia!ent issued a release,

by %hich the oundations %ere laid or a partnership %ith Arica?, seeking to de&elop

large inrastructure net%orks, as part o the European -nion strategy or Arica, ratiied

in 800/$

A thorough study %as conducted by the co!!issioners and it %as concluded that the

said partnership %as to be i!!inent due to Arica.s li!ited access to transportation,

teleco!!unication ser&ices, utilities and drinking %ater supply, thus constituting a

!a;or hindrance to po&erty reduction in a continent %here only /9B o the population

has sanitation acilities@ less than 80B has access to electricity$ 7aking into

consideration that people and goods typically tra&el on roads, !ass transportation

syste!s are insuiciently %ell4de&eloped$ ater resources are une&enly shared and

sub;ect to %eather changes$ Let alone, no%adays digital di&ide$

ith this in &ie%, the partnership in tande! %ith the orld 1ank set to %ork in basic

do!ains: transportation, %ater and sanitary net%orks, energy and teleco!!unications

inor!ation i!ple!entation$

7he initial esti!ated budget %as F?*0 !illion Euros$ -p to this day, %orks ha&e not

been co!pleted, despite oreign assistance or the crisis hit Europe probably harder than

other zones o the %orld$

Such is a s!all depiction o %hat goes on %orld%ide, not only in de&eloped nations but

also in those ;ust like the one ' speak on behal o$ E&en the so called e!erging

*uropa%eu/le+islation%summaries/development/sectorial,development,policies%/r101,es-.tm


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countries are acing si!ilar issues$ 't can be stated about these countries. econo!ies that

they ha&e the! all: territories ull o natural resources, sound inances, and steady

gro%th$ =et, they struggle %ith a !a;or issue in ter!s o hardcore inrastructure: 'ndia

currently has >0 !illion people %ho dont ha&e access to utilities, being the %orlds

third country to produce ra% !aterials or de&eloped countries$

1razil too is one o the %orlds greatest producers o ra% !aterial and yet, it has one o

%orld.s poorest seaport syste!s$

China is a!ongst the leading country in internal !igration rates$ "illions o

country!en lea&e their land or the cities thus increasing the need or %ider

transportation and electricity co&erage@ Jietna!, 'ndonesia, 7urkey, South Arica, and

Colo!bia a!ongst others, ha&e signed trade agree!ents that a&or eport trade %hile

acing poor in inrastructure in roads, oil, !ining %hich %ould allo% the! to epedite

and i!pro&e eports and i!ports o traded goods

During the irst years o this decade, through a nu!ber o su!!its and conerences, the

international co!!unity agreed to &arious co!!it!ents geared to pro!ote global

socioecono!ic gro%th$ 'n 8000, it %as the "illenniu! Declaration %hich set the

"illenniu! De&eloping oals 3"D5$ 'n 800(, 27he 1russels 6rogra!. %as geared

to%ards de&eloping countries$ 7his progra! %as urther reiterated in the orld Su!!it

on Sustainable De&elop!ent in 80084800?4800/, in %hich landlocked countries %ere

included$

't.s note%orthy !entioning that these su!!its ha&e set the ea!ple on dra%ing goals

and progra!s regarding global de&elop!ent issues, despite the crisis$


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Such is the case o !y country, %hich aced a decade o %ar %age and %as let %ithout

inrastructure, ;ust as so !any Arican countries ha&e$ 'n spite o this, %e %elco!ed

oreign in&estors in the light o our countrys potential or natural resources &ersus a

lo% output$ 't is esti!ated that or 80(? Nepal %ill produce 8*000 o electric energy

or its o&erall population as %ell as building roads, housing and disaster resistant

inrastructure per the signing o the +yoto 6rotocol and the "arco Con&ention$ 7his

%ill result in boosting touris! industry, increasing its capital or business as %ell as that

o its partners$

7HE SB$

Healthcare and educational ser&ices are !ore accessible no%$

A## 'n&estors, leaded by "organ Asset "anage!ent, build roads connecting

indigenous co!!unities, hydraulic syste!s, schools and !edical acilities, obtaining up

to ?0$8B o&er the initial in&est!ent$ 'n China, Sie!ens sells goods or !anuacturing

actories eperiencing considerably proit$


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As a conclusion, the international co!!unity can no longer be a !ere spectator %hile

!illions o people around the %orld continue to languish in po&erty and o&er%hel!ing

eclusion$ 7here is a %ay out o po&erty and it is %ithin e&eryones reach pro&ided ;oint

action$ Nothing %ill be acco!plished %ithout an international rein&igorated political

%ill, increased resources, sustainable policies and progra!s in tande! %ith co!!itted

national leadership$ 7ogether %e can !ake this happen$ 7his is truly the lesson %e ha&e

learnt ro! all the su!!its and conerences

#EIE#ENCES

http:K%%%$un$intK%c!KcontentKsiteKNepalKcacheKoonceKpidK?)(>@;sessionid/0c

Europa$euKlegislationMsu!!ariesKde&elop!entKsectoralMde&elop!entMpoliciesKr(?0(?M

es$ht!

%%%$proeport$co!$coKsitesKdeaultKiles

%%%$un$orgKenKde&elop!entKdesaKpolicyK%espMcurrentK80(?%espMesMsp$pd
http://www.proexport.com.co/sites/default/fileshttp://www.un.org/en/development/desa/policy/wesp_current/2013wesp_es_sp.pdfhttp://www.proexport.com.co/sites/default/fileshttp://www.un.org/en/development/desa/policy/wesp_current/2013wesp_es_sp.pdf


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ECOFIN

NEPALS POSITION PAPER

TOPIC B

Delegates: Sebastian Hernndez, Ernesto Lanos

Introduction: The income gap is the synthesis of many of the problems that

have the international community in the world, this issue is so important that

almost all issues are related in some way with it, for example the black market

that in Nepal is a viable solution to people that can`t maintain a good life with

the legal work, Nepal thinks that we must focus in the problems that affect

global income, like that the government is capable of give all people

opportunities, education, and the minimum to life because when a government

can`t do this the people that cannot life without a help, for necessity try to gain

money by the illegal road and this lead to corruption, black market grow,

violence, inequality, and that more people is involve in illegal obs are not

helping the country with the work, they help themselves and harm the country

not ust economically, so the international community and each country has to

implement several and hard regulations to these problems, this is an issue that

has affected the world many time and is our ob to make that it stops, or to

reduce to the minimum!

"elated #istory $ statistics

Nepal oined with %sian developing countries are developing a regional

economic cooperation since the &'() promoted by the *nited Nations

+conomic and ocial -ommission for %sia and the .acific /*N+-%.0! This


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cooperation includes the 1angkok %greement established in &'(2 which

covered reciprocal tariff concessions between five member tates, India,

1angladesh, 3ao .eople4s 5emocratic "epublic /.5"0, ri 3anka and "epublic

of 6orea, -hina oined the 1angkok agreement in 7))), and the %sian union

with ( members including 6ingdom of Nepal start in the &'(8!

The Nepal government4s policy of actively seeking private sector investment

since the &)th 9ive;ear 5evelopment .lan have not reach et significant

advances, -ivil war78? compared with >8?' for 1angladesh, >@@) for .akistan,

>@A@ for India, >&,&88 for ri 3anka, >&,7(( for 1hutan, and >?,@@A for

Baldives! peaking In terms of =5., Nepal is where ri 3anka was in &'@),

.akistan was in &'(), India and 1hutan were in &'A)! The reforms during &'')

to 7))), Cn the poverty front, remittance flows and investments in rural

infrastructure have helped reduce poverty incidence from 87D in &''2


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main agricultural crops and to a rise in tourism! %lthough the total investment

rate is reportedly high, this may be misleading as part of the rate is estimated as

the residual value to balance the income and expenditure account and is prone

to estimation errors and statistical discrepancies! The fixed investment rate

/gross fixed capital formation0, estimated using the materials


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5espite its tourism and energyproduction potential, Nepal remains one of the

worldFs poorest countries! The per capita income for 7))(8()

*! Cver &


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superavit of the economy, but after his leadership, the new president =eorge

1ush and the coming wars in the middle east like Iraq came into consequences,

the superavit turn into a deficit, one of the economic power of the world has a

income gap in his economy, and now still the president 1arrack Cbama is trying

not to resolve the problem, he tries to slow the crisis, and the losses affect the

people, if the country lost economic power, the distribution of wealth will be less

and the way of live of the people will be affected, so the poverty will increase,

for this a common discussion in the tates is if the richest have to pay more

taxes!

The tate must work as a regulator to the effects, achieve a maor equitable

distribution of the wealth of the country, directed to the maor possible number

of persons, because of it, a tax suitable politics should adapt the levels of

income between those of maor revenue, respect of the most postponed

sectors, which they find under the level of minimal revenue, this is, the minimum

wage necessary for a life in the country!

*ntil now as always the prices of products rises as a elevator and the salaries

go for the stairs, this problems of the economy increase and our tries to resolve

are not enough, also the external factors as corruption, conflicts, external and

internal with the inequality in every country that is very concern, the few have

everything and the maority live with the rest as they can, the corruption that is

the center of the sub problems affect occasionally the public institutions for the

benefit of the private, the individual, the interest of one that corrupt the public

sector focus in this particular interest, the real obectives are affected and like

magic the people pays for the evil of the few, this includes our personal in the

institutions and to make this stop implies to focus an institution to resolve the


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problem directly and indeed this particular institutions need resources without

mention that it can be corrupt so the illegal movements don`t have limits, if they

can played someone will accept a price at the end!

9or worst corruption can work in many sector and in many ways, the bribes is

the principal tool of the corruption, because the limit is money, and money is a

factor in which illegal frameworks are always counting with, there are many, the

=overnment contracts in which it can influence the government`s decisions

about supply goods, services, and works changing the terms of their contracts!

The government benefits in which the benefits of the government are given to

the illegal framework, or to a particular type of individual like to the richest that

look benefits for its company, like an authoriHation to contaminate and make the

growing of the company easier! %lso use the brides to reduce taxes, or avoid

them, also to have a license for an exclusive right or for a particular reason, and

the last in brides is the 3egal outcomes in which 1ribes can change the

outcome of the legal process as it applies to private parties, by inducing the

government either to ignore illegal activities and giving this illegal processes be

almost free and make more damage to the society!

%s brides is the principal tool of corruption, corruption attacks many sectors, the

first is the .olitical and bureaucratic corruption which involves election laws,

campaign finance regulations, and conflict of interest rules for parliamentarians,

the next sector is Isolated and systemic corruption in which noncorrupt

behavior is the norm, and institutions in both the public and private sectors

support integrity in public life! uch institutions, both formal and informal, are

sufficiently strong to return the system to a noncorrupt equilibrium! The last one

is the -orruption in the private sector!iv


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The now Illicit 9inancial 9lows, like corruption, bribery, theft and tax evasion,

cost developing countries * >&!7@ trillion per year, which is equivalent to the

economies of witHerland, outh %frica and 1elgium oined, this represents &!8

billion people living on less than >&!72 a day above this threshold for at least six

years which leads to a secondary problem very important, the inequality, also

the bad distribution of wealth, Cver &7 months, one in four people paid a bribe

when they came into contact with one of nine institutions and services, from

health to education to tax authorities!ource: Transparency International, =-1

/7)&)0, surveying '&,2)) people across A@ countries0

%nd now Nearly three quarters of the &(A countries in the -orruption

.erceptions Index score below five, on a scale from &) /highly clean0 to )

/highly corrupt0, suggesting a perception of widespread corruption among public

officials!v

=lobal poverty is concentrated in outh %sia, where half of the worldFs poor live!

%nother quarter live in subaharan %frica, while one quarter live in +ast %sia,

mainly -hina! Eorld inequality between households has increased, the income

of the richest &D is the same as the income of the poorest @)D in the world %nd

the all the gains in world income in the middle of the last decade went to the

richest 7)Dvi, so one and most concerning problems is this, but take a look the

problem here is not the lack of money is the wrong distribution in the world, it

could be a equity in people, eliminating one problem of the income, both

corruption and wrong distribution are consequences, and affect the income gap!

To solve this concern, we must first concentrate in solve corruption, poverty, and

important the distribution of wealth in each country, including the developed,


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economically focus to develop in the economy sectors for the undeveloped

countries, for a grow in the economy making benefits for the people, also

making impossible the monopolies and the exclusive benefit of the private

sector, at least the multinational countries, and last the wealth is concentrated in

wealthy families, that conserve money making hard to have opportunities for the

poor, making hard to develop if you are not rich, the rich everyday are more rich

and the poor more poor, this also happens between countries of north and

south, giving no chance to a poor country to have a superavit ust to increase

the deficit!

iblio+rap.y


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