From Evidence to Policy Supporting Nepal’s Trade Integration Strategy : Designing Institutions to Promote Trade and Investment in Nepal
As a small, landlocked economy, Nepal’s development prospects are closely tied to its ability to increase integration in the regional and global marketplace. Despite significant changes in Nepal’s trade sector over the past decade, the country’s ex...
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| Format: | Report |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2016
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| Online Access: | http://documents.worldbank.org/curated/en/2016/07/26564537/evidence-policy-supporting-nepal’s-trade-integration-strategy-designing-institutions-promote-trade-investment-nepal-policy-note-5 http://hdl.handle.net/10986/24933 |
| Summary: | As a small, landlocked economy, Nepal’s
development prospects are closely tied to its ability to
increase integration in the regional and global marketplace.
Despite significant changes in Nepal’s trade sector over the
past decade, the country’s export performance has remained
poor, with exports growing at a much slower pace than
imports. Nepal’s external vulnerability is deepened by its
dependence on remittances to finance growing trade
deficits.Achieving greater integration in the global economy
and building a competitive export sector will require
overcoming various economic and institutional challenges.
This paper assesses the performance of these organizations
in their role of promoting exports and investment. It has
two main objectives. First, we describe the main export and
investment promotion institutions in Nepal and examine their
mandates, missions, and the services they offer.Second, we
look at international best practices in export and
investment promotion, to identify cost effective approaches
appropriate for small developing countries. Based on this,
we provide a number of recommendations for strengthening and
improving the role of export and investment support
organizations and initiatives in Nepal, as well as the level
of coordination and cooperation among them. The report is
organized as follows. In the next section, we briefly review
the economic rationale for public intervention in the
promotion of exports and investment and summarize the main
findings of the literature regarding the most effective
institutional designs and practices. We also discuss the
arguments for and against a merger of the two activities
within a single institution. Section three describes and
assesses the institutional framework for export and
investment promotion in Nepal. In Section four, we examine
four case studies of “best practices” in the promotion of
exports and export-oriented investment –Costa Rica, Jamaica,
Colombia, and Latvia. We also discuss examples of successful
promotion and development of the links between the tourism
sector and exports, Mauritius, which offers some lessons for
the case of Nepal. The final section contains the policy recommendations. |
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