KATHMANDU, Sept 26: Nepal’s economy is anticipated to grow by 5.5% (at basic prices) in fiscal year (FY) 2019, down from 5.9% a year earlier says the latest Asian Development Bank (ADB) Nepal Macroeconomic Update.

“The growth forecast represents a continued trend reversal but is substantially higher than the average rate of 4.3% in the last 10years (FY2009-FY2018),” the statement reads quoting ADB’s Principal Economist for Nepal. “Growth will be supported by expectations of greater political stability following the 2017 elections, normal monsoon, and efforts to accelerate implementation of mega infrastructure projects”, the statement added.

The limited capacity at sub-national levels and challenges to smooth implementation of federalism may pose risks to growth. According to the update, some of the major issues affecting the smooth implementation of fiscal federalism are slow to progress in requisite legislation and deployment of staff, the need for further clarification of mandates and responsibilities of the three tiers of government, and inconsistencies in revenue mobilization regarding fees and taxes at local levels.

The agriculture sector will likely grow from 2.8% in FY2018 to 3.5% in FY2019, on the back of an anticipated bumper harvest supported by a good monsoon. Industry sector is expected to expand by 7.2% in FY2019 buoyed by improved electricity supply. And the services sector will likely grow by 6.1% in FY2019 with the expansion of wholesale and retail trade, financial intermediation and travel and tourism subsectors.

The update says inflation is projected to rise to 6.0% in FY2019 from 4.2% in FY2018, partly reflecting higher inflation expected in India, a modest rise in oil prices and higher government expenditures under the new federal structure.

Though revenue collection of Nepalese Rupees731.4 billion (24.3% of GDP) slightly exceeded the budget target in FY2018, the fiscal deficit widened to 6.7% of GDP with the rise in government expenditures compared to the previous year. While capital expenditures increased by 28.0% in FY2018 with the execution rate at 79.7%, the hasty nature of spending has continued undermining the quality of capital projects, says the update.

Nepal increasingly faces the risk of external sector instability due to a rising trade and current account deficit. The current account deficit of $2.4 billion (8.2% of GDP) in FY2018 is significantly higher than the deficit of $95.7 million, or 0.4% of GDP, a year earlier. The merchandise trade deficit increased on the higher import of construction materials and capital goods in FY2018. While remittance has shown a healthy growth, a substantial rise in the near future is unlikely to offset the rise in the trade deficit, leading to further widening of the current account gap.

ADB is committed to achieving a prosperous, inclusive, resilient, and sustainable Asia and the Pacific while sustaining its efforts to eradicate extreme poverty. Established in 1966, it is owned by 67 members—48 from the region. In 2017, ADB operations totaled $32.2 billion, including $11.9 billion in co-financing.

Source: Republica

Corporate News

Parliament body asks govt to solve problem of multiple taxation

KATHMANDU, Aug 15: Parliament’s Finance Committee on Tuesday issued directions to the government to take the lead in solving the chronic problem of multiple taxation by the three tiers of government, as well as the exorbitant hike in tax rates.

Read more ...

Trade deficit surged five-fold in last decade

Kathmandu, August 5 - The country’s trade deficit jumped five folds in the last decade as imports have been skyrocketing and exports have slowed to a crawl in the review period.

Read more ...

Commercial banks yet to reach 122 local units

KATHMANDU, July 29: According to the latest data of the Nepal Rastra Bank (NRB), commercial banks have opened their branch offices in 631 local units so far, leaving 122 local units without their coverage.

Read more ...

Currency war can end global US dollar dominance & those who own gold have power

MOSCOW, June 24: The world is facing a currency war and the only hedge against the crash of the US dollar is real gold, a precious metal analyst has told RT. With geopolitical power shifting from West to East, US dominance may be ending.

Read more ...
Symbol % Change Last Price Turnover
IGI 7.2973 397.0 352,720.0
API 5.6738 149.0 2,254,309.0
SLICL 3.9261 450.0 1,225,598.0
PFL 3.9063 133.0 341,863.0
GLICL 3.4926 563.0 1,692,704.0
Symbol % Change Last Price Turnover
KMCDB -7.4300 760.0 184,245.0
MSMBS -5.6881 514.0 34,187.0
UMHL -4.5113 127.0 33,287.0
KEBL -4.4280 259.0 529,734.0
RRHP -3.7383 103.0 82,760.0
Symbol % Change Last Price Turnover
NMB 1.4245 356.0 44,637,965.0
NBL 0.6897 292.0 33,249,614.0
GBIME 0.6410 314.0 17,722,007.0
MBLPO 0.0000 130.0 16,754,530.0
PRVU 0.8403 240.0 16,004,646.0