WTO to review Nepal's progress on trade development

Enhanced Integrated Framework (EIF), an initiative of the World Trade Organization (WTO) working to enhance trade capacity of the least developed countries (LDCs), is soon reviewing the progress made by Nepal on exploiting trade potential since the program was implemented in the country in 2010.
Toya Narayan Gyawali, joint secretary at the Ministry of Commerce and Supplies (MoCS), said EIF board has initiated the process for hiring an independent team to review the progress that Nepal has made after institutionally starting the EIF program under MoCS.
“The review will measure the achievements Nepal made after implementation of the EIF program,” Gayawali told Republica. The review would also help policymakers compare the program´s output with other LDCs that have received similar support from WTO to improve trade.
Nepal has received two tiers of support from the EIF. Under which tier-1was implemented eyeing to upgrade the quality of human resources, prepare study reports on trade and development, formulate project supporting country´s supply capacity, whereas under tier-2 package, it has received support on developing trade related infrastructure.
“The EIF is reviewing Nepal´s progress as part of its country review decision. As per the decision, it would gauge output of its support to all the 40 countries that have implemented its program,” Gayawali said.
Under the tier-1 support, Nepal has developed Nepal Trade Integration Strategy (NTIS) 2010, identifying 19 products -- 12 goods and seven services -- in which the country enjoys special competitive edge to boost trade and ultimately achieve the goal of poverty reduction.
The registration of Chyangra Pashmina, a collective trademark of Nepali pashmina products, in more than 40 countries of Europe, America and Asia too was done with support from EIF.
Likewise, recently the government had also successfully received fresh support from EIF to enhance production and improve the value chain of ginger -- one of the niche exportable products included in NTIS. MoCS has also sought EIF assistance for the development of medicinal herbs processing industry in the country.
"The independent review will help us to plug the loopholes that are putting downward pressure on the country´s trade," said Gyawali.
Though traders and farmers are yet to witness tangible results of EIF initiative, officials believe Nepal´s status in the review will be better than other LDCs in terms of formulating policies and designing tools to boost export of the goods and services.

Nepal fails to report country policy updates at WTO in time

The government has dragged its feet to timely report the country´s policy updates to the fellow World Trade Organization (WTO) members even as Nepal´s commitment at the Organization required it to report them by April, 2012.
Though submission of such report, under which Nepal needs to clearly inform the changes and update it effects in trade and other national policies, is not a binding obligations, its compliance is considered crucial in sending a message that the country is investment and trade friendly.
“Submitting policy briefs on time builds a good image of the country among the other member in the WTO regime. Sadly, apathy to adhere to this moral obligation have repeatedly portrayed our image negatively,” said Dr Posh Raj Pandey, former member of the National Planning Commission (NPC), who was also engaged in the process of country´s accession to the WTO.
Officials at the Ministry of Commerce and Supplies (MoCS) supposed to carry out this task admitted of the adverse impact. But they failed to give convincing reasons behind the delay.
“We have already started the preparations and are trying to forward the policy updates at the earliest,” said Ravi Bhattarai, under secretary of MoCS. Though he too remained silent on the reason behind Nepal consistently failing to comply with the obligations, knowledgeable sources said lack of zeal and dedications of the concerned staff themselves were the main reason.
“The reality is that maintaining a good working relationship with the multilateral trading partners is simply not in the priority of the Ministry. Hence, not even the top MoCS care whether the ministry carried out tasks as committed at the WTO,” said the source.
This is not the first time the country missed complying with the WTO commitments since it joined the multilateral trading regime in 2004.
Records of the MoCS shows the country had failed to enact competition and other laws and update trade and other policies on time in the initial years of membership. Though the country has presently fulfilled almost all binding commitments, it has always been dragging its feet to comply with commitments that are not compulsory, but exist as moral obligations.
“Very recently, the Ministry had missed the deadline to submit trade policy review as well,” said Dr Pandey. Although the WTO commitment schedule had sought Nepal to submit the trade policy review in December, 2011, the MoCS did so only in February 2012.
Under the WTO norms, all WTO members need to submit their policy updates to the organization so that other member countries can clearly know the status of tariff lines, rules and regulations related with goods and services they trade on.
Such transparency is considered crucial in maintaining effectiveness of the multilateral trading.

Govt seeking WTO assistance to boost exports of medicinal herbs

In a bid to promote exports of medicinal herbs in international market, the government is preparing to seek assistance from Enhanced Integrated Framework (EIF), an initiation of World Trade Organization (WTO), for the collection of medicinal herbs and setting up herbs processing center.

The Ministry of Commerce and Supply (MoCS), which is entrusted to carry out the implementation of Nepal Trade Integration Strategy (NTIS) 2010 -- a blueprint to boost export -- is preparing to submit a proposal to this effect to the EIF in order to get its assistance for improvement of forward and backward linkages -- that establishes a mechanism to trickle down the returns of the product.

“Medicinal herb is the third product, after ginger and pashmina, for which we are seeking EIF assistance to develop backward and forward linkages,” Toya Narayan Gayawali, joint secretary at the MoCS, told Republica on Tuesday.

USA, France, Germany, Vietnam, Singapore, Japan, Italy, Russia, Belgium and South Korea have been identified as major destination countries for Nepali medicinal herbs.

According to Gyawali, the ministry is seeking EIF assistance to add more value to Nepali medicinal herbs.

The government has already received Rs 110 million from EIF to enhance production and processing of ginger. Similarly, the government is working on registering trademark of Nepali Pashmina in the international market. “We will closely work with the Ministry of Forests and Soil Conservation in order to implement the activities that we have planned to promote exports of medicinal herbs,” added Gyawali.

According to the statistics of Trade and Export Promotion Centre (TEPC), Nepal exported medicinal herbs worth Rs 710 million in fiscal year 2010/11.

 

WTO urges effective use of EIF

World Trade Organization (WTO), which initiated Enhanced Integrated Framework (EIF) to advance the trade of least developed countries by removing supply-side constraints, has warned that LDCs themselves were responsible to use the EIF to better address their weaknesses and utilize strengths.
Pascal Lamy, director general of the WTO, has asked LDCs to work themselves to fully utilize the EIF process.
“They have to use the EIF as a platform to solidify trade within their national development plans and priorities,” Lamy said in high level meeting in Doha, Qatar last week. He urged LDCs to leverage additional Aid for Trade (AfT) support to consolidate current efforts. Government of Nepal is also one of the recipients of the EIF facility.
The EIF is about placing trade as an engine of growth, poverty reduction and employment by creating a platform where demand and supply of trade-related assistance can be expressed and bridged. In Nepal, the Ministry of Commerce and Supply (MoCS) is implementing the EIF program. 30 out of the 46 EIF beneficiary countries have accessed for Tier 1 project funds for institutional capacity building to support National Implementation arrangements. Furthermore, four Tier 2 projects have been approved and an additional ten Tier 1 and 26 Tier 2 projects are in the pipeline.
Nepal is implementing the Tier 1 and is preparing to access for Tier 2 of EIF, which provides increased, predictable and additional funding on a multi-year basis. It helps build strategy for the national development -- Nepal Trade Integrated Strategy (NTIS) -2010, a blueprint to boost the export of the country was prepared under the EIF process.
The EIF will undertake its mid-term review later this year. “This independent process will provide an assessment of how the EIF has been delivering on its mandate,” Lamy said. “For the EIF to continue to deliver; it will need continued commitment from the LDCs and commitment from development partners as well on the sustainability of funding.” He further requested developed countries to invest in trade capacity.
Lamy also urged UN, World Bank, IMF, and the WTO to support these processes and LDCs. “LDCs are an integral part of the WTO and they stand to lose more than any other member if the current stalemate in the Doha Development Agenda is not resolved,” Lamy said, pushing for the earliest resolution of the stalemate.

Nepal's trade policy discussed at WTO

Commerce secretary Lal Mani Joshi on Wednesday began detailed discussions on the country´s trade policy at the headquarters of the World Trade Organization (WTO) in Geneva.

“In Nepal´s first trade policy review meeting after joining WTO, secretary Joshi said Nepal has pursued structural reforms in all the sectors of economy and that the country has made considerable process in economic liberalization,” Shankar D Bairagi, Nepal´s permanent representative in Geneva told Republica over phone.

The review meeting kicked off on Tuesday. Nepal had joined WTO in 2004.

According to Bairagi, Joshi also answered to queries raised by representatives of Nepal´s major trading partners. “He will respond to the remaining queries on Thursday. Representatives of US, China and India, among others, are raising questions about Nepal´s investment environment and infrastructure development,” added Bairagi.

Bairagi further said major trading and development partners appreciated Nepal´s progress towards economic liberalization and strong commitment in compliance to the WTO norm.

According to a press release issued by Nepal´s permanent mission in Geneva, secretary Joshi told the meeting that Nepal had high-level Investment Board aiming to create investment friendly environment for both domestic and foreign investors.

“The Nepali delegation also pointed out number of challenges and constraints in Nepal´s efforts to promote international trade,” the release added.

Bairagi said Christine Hochstatter, alternate permanent representative of Germany, as the discussant, commented on reports of the Government of Nepal as well as of the WTO Secretariat and suggested measures for further reform of Nepal´s trade sector.