Evolve regional strategy on drinking water supply, sanitation: World Bank

As unclean water and sanitation is the world´s second biggest killer of children, the World Bank official on Wednesday urged countries in South Asia to evolve out a common strategy to tackle this problem in the region.
"Policy priority, insufficient funding, rapid urbanization and lack of public awareness have mainly impeded attainment of long-term sustainability of water supply and sanitation in South Asia," said Tahseen Sayed, World Bank country manager for Nepal.
"Weak institutional capacities are other problems for us in the region to attain our goal of reducing number of people who do not have access to drinking water and sanitation," she stated
Sayed was speaking at the South Asian regional conference on drinking water and sanitation, which kicked off in Kathmandu on Wednesday.
The three-day conference is being attended by more than 100 experts and officials from the different countries of the region. Through the conference, they hope to identify a common strategy to mitigate challenges seen in access to drinking water and sanitation in rural areas and also identify the workable institutional models for the region.
According to the World Bank, more than 500 million people do not have access to sanitation and 250 million people to drinking water in South Asia, which is home to 1.6 billion people.
"Despite its economic success, South Asia, now, represents the largest concentration of the world´s poor, as well as those lacking access to safe water and sanitation," said its statement.
According to the Bank, the conference will discuss on identifying sustainable ways of water supply, increasing sanitation access and reducing challenges -- challenges of declining water quality and quantity. "It will also focus on developing partnership between public and private sector to advance rural water and sanitation," Sayed said.
Janak Raj Shah, member of the National Planning Commission (NPC) said that the inadequate coordination among major players in the field of water supply and sanitation, weak implementation of the program and lack of proper approach to handle the projects were major hurdles of water supply and sanitation in Nepal. “
"We are lagging behind to achieve our targets under millennium development goals on sanitation and water supply," Shah said. The government has targeted to increase access to water supply and sanitation to 53 percent of the total population by 2015.

Govt, pvt sector put joint effort to improve condition of doing business

In order to portray Nepal as a viable destination for foreign direct investment in the international market, private and public sector are jointly working toward improving the condition of doing business in the country -- that will be reflected in the annual ´doing business´ report of the World Bank.
In this regard, Federation of Nepalese Chambers of Commerce and Industry (FNCCI), Nepal Chamber of Commerce (NCC), Nepal Freight Forwarders Association (NEFFA) and Department of Customs (DoC) are jointly working with the International Finance Corporation (IFC) of the World Bank with the aim of placing Nepal in higher echelon of the doing business index.
“Nepal´s rank in the doing business report is not satisfactory and all of us want it to be better,” Rajan Sharma, president of the NEFFA, said. “We are working on ways to reduce the paper work and procedure to start a business.”
According to Sharma, the main focus will be on finding ways to reduce the cost of doing business, required documentation cost for registering a business and shorten export and import procedures. Nepal was ranked 107th in the doing business report of 2012 out of 183 countries, which is a slight improvement from 2011.
Doing business report is a document that is taken as a guide by foreign investors who want to step in to Nepal with the aim of making investment. It is also a mirror of the country which motivates investors to invest. “We will prepare a guideline which will show how the condition of doing business can be improved in Nepal,” Sharma said.
According to the doing business report 2012, it takes 29 days to start a business in Nepal and 7 procedures should be completed. Likewise, it costs 37.4 percent of per capita income for registration of a business, which is 15.8 percentage points higher than the average cost in South Asia. “The project aims to decrease cost, ease procedures and shorten days required to start a business, so that the country can achieve a better position in the report,” Sharma said.
The doing business report also ranks a country in terms of starting a business, dealing with construction permits, getting electricity, registering property, getting credit, protecting investors, paying taxes, trading across borders, enforcing contracts and resolving insolvency related issues. Nepal´s rank in the report of 2012 is not good in all these cases. The worst is in terms of trading across borders -- Nepal was ranked 162nd out of 183 countries all over the world.

CAPITAL FLIGHT AND NEPAL

This Commentary was first published in the The Reporter Weekly

"I am surprised to know this figure," Economist Dr. Madan Kumar Dahal said when I shared with him the total amount of illicit financial outflows from Nepal in the last decade ending 2009. The report-- 'Illicit Financial Flows from Developing Countries Over the Decade Ending 2009' –released recently says that total amount of illicit financial outflow from Nepal is estimated to be US $ 6.040 billion during the period.

Trade mispricing, proceeds of corruption and bribery are cited as the three major drivers of illicit financial outflow from Nepal by the report.  Available information suggest that the trade mispricing contributes 83 percent of total l outflows from Nepal. This study by Global Financial Integrity (GFI) tracks the amount of illegal capital flow from 157 countries. The GFI has ranked all the countries on the basis of volume of total illicit financial outflows and Nepal is placed 83rd.

The total illicit financial outflow from Nepal is around 7.25 percent of our Gross Domestic Production (GDP) compared to the same time period.  The amount of money thus lost is enough to run  almost two fiscal years if the amount is compared with that  of the  annual budget of  the government.

The  GFI has taken into account  the balance of payments (BoP), bilateral trade, and external debt data reported by member countries to the International Monetary Fund (IMF) and World Bank while preparing the report. Dr Dahal who is also an expert in Macro Economics, says that this report throws a challenge to the government to  trace the way, and destination of the capital flight and those responsible for it.  Senior officials from Ministry of Finance (MoF) and Nepal Rasrta Bank (NRB) were reluctant to be quoted.

The enactment of the Anti-Money Laundering Act-2008 and Anti-Money Laundering Regulations-2010 together with the establishment of Financial Information Unit (FIU) within the Nepal Rastra Bank (NRB) may be taken as attempts to deal with the problems of illicit financial outflows. But these acts, regulations and units do not appear as effective when Nepal is losing more due to trade-mispricing. The average contribution of trade-mispricing in Asia is just 53.9 percent where as in Nepal's case, the figure is well above -- 83 percent—the mark.

The illicit financial outflow has become a global problem that the governments from different countries are trying to address. But the same cannot be said about Nepal. While some  cases of anti-money laundering in the supreme court of Nepal  filed few months back have taken their own time, government bailing out the  VAT fraud case worth billions of rupees—of late by transferring the investigating officials en masse—makes its intentions clear.

GFI, an NGO based in Washington DC defines illicit financial flows as 'proceeds from both illicit activities such as corruption (bribery and embezzlement of  national wealth), criminal activity and the proceeds of licit business that become illicit when transported across borders in contravention of applicable laws and regulatory frameworks.  And it has its own impacts. The illicit capital flight doesn't only create the illegal problems, but also weakens the capacity of economic indicators of reflecting the situation.

Nepal Gets $ 1 billion Remittance in 2 Years

Nepal has gained around $ 1 billion amount of remittance within two years (2009 to 2011). This amount is quite bigger than the total amount of foreign aid that comes to Nepal. In 2009 Nepal had gained $ 2.985 billion and now in this year the total amount of remittance that comes to Nepal is estimated to be $ 3.951 billion. This amount is 23 % of our total budget of Nepal’s yearly budget in 2011/2012.

This is quite interesting to see that the 23% of our total budget comes through the remittance but we hardly can see any significant uses of it in the development sector. The remittance has been a driving force for the sustainability of Nepali economy.

• Remittance flows to developing countries are expected to total $351 billion this year.
• Worldwide remittances, including those to high-income countries, will reach $406 billion for the current calendar year, according to a newly updated World Bank brief on global migration and remittances.
• The top recipients of officially recorded remittances, estimated for 2011, are India ($58 billion), China ($57 billion), Mexico ($24 billion), and the Philippines ($23 billion). Other large recipients include Pakistan, Bangladesh, Nigeria, Vietnam, Egypt and Lebanon.
• While the economic slowdown is dampening employment prospects for migrant workers in some high-income countries, global remittances, nevertheless, are expected to stay on a growth path and, by 2014, are forecast to reach $515 billion. Of that, $441 billion will flow to developing countries, according to the latest issue of the Bank’s Migration and Development Brief, released today at the fifth meeting of the Global Forum on Migration and Development in Geneva.