Connecting with the People of Nepal:

 - Dr Linda Spedding

(www.lindaspedding.org)

As this year marks the bicentenary of Nepal-UK relations I would like to add warm congratulations to the people of Nepal at this time. Indeed, I would like to add my support by reaching out to the Nepalese people who are now about to give shape to the Constitution and to begin a new era of democracy, justice, transparent respect for human rights and inclusive development. I wish the people all success for theirnewt Constitution and positive progress into peace and prosperity after a long period of difficulty.

Having made appropriate research, it is my understanding that Nepal’s economy can be built on very healthy and inclusive lines, duly leveraging its core competencies and by working on the parameters that constitute the global competitiveness and the human development indices. It is timely for Nepal tobecome a competitive economy and move up the global competitiveness index which comprises of 12 categories – the pillars of competitiveness – which togetherprovide a picture of a country’s competitive landscape. The recognized pillars are: institutions, infrastructure, macroeconomic environment, health and primary education, higher education and training, goods market efficiency, labor market efficiency, financial market development, technological readiness, market size, business sophistication and innovation which need to be worked on most diligently.Moreover Nepal should be allowed the opportunity to become a prime exemplary destination that is transparent and inclusive, reflecting the spirit of the majestic summit of the world that the Himalayas epitomize.    

I have always loved this beautiful country and its rich tradition. While we as a country have had a long history of cooperation, I as an individual have felt an empathy with Nepal, and have kept track of how it has evolved during my professional life in terms of its economic development, upkeep of the sanctity of human rights, civil liberties, freedom of speech, et al. Accordingly, I would like tooffer some thoughts in the area of energy, economics and sustainability on the development side. Moreover, on the legal side I would highlight environmental, constitutional and international law to assist the positive empowerment of the civil society in its endeavor to carve a bright future for its constituents (bearing in mind my experience over the last three decades (www.lindaspedding.org).Accordingly I would like to make a few suggestions that may be helpful in the selection of priorities that need consideration and implementation.

There are many potential areas that, in my view, after seeking appropriate guidance, can blossom under the right leadership and stewardship. I will comment on a few aspects mentioned that are vital: energy, environment and economic best practice. For instance I am advised that one of the highest priorities on the development side lies in the need to help Nepal harness its hydel power potentialfully and appropriately. This should enable the nation to transform itself as an economic powerhouse, as well as its people’s lives, to a degree that they deserve. Well developed and appropriate tourism is another opportune area where its strength may be harnessed so that the real potential of Nepal can be appreciated.

In the area of sustainable forestry and forestation, Nepal has been regarded as having similar potential to Finland, one of the most competitive economies today with one of the highest PCI, largely as a result of its forest-based economy. With the world’s strongest and most valuable species of timber – “Salwood” – evidently enjoying robust growth in Nepal, it is vital that such potential be allowed to develop.  I further understand that a vast area in the country lies as wasteland andshould be brought under forest cover in some way (whether by the public or private sector or in partnership). I understand that not only the wastelands, but also the hills in the “Chure” and “Mahabharat” ranges, are extremely suited to be afforested, and, that the existing forest cover could be reforested and scientifically taken up for best yield. Interestingly, I am informed that, thanks to the topography, with more lands covered by hills, the total area available for plantation in Nepal is much higher than an equivalent amount of area would be on the plains. In effect, therefore, the Himalayan nation has the advantage of a higher area than what statistics may show.

The above should serve many purposes simultaneously. A larger part of the forests could serve to attain economic returns in a planned and sustainable manner while another part would help maintain an environmental equilibrium that benefits not only Nepal but also the region at large. All of this should help contribute in sequestering Co2 in the region and the country would have gains from Carbon Credits as a result and subject to proper guidance. Alongside forestry, the farmers can pursue intercropping and cattle farming to provide a livelihood.

A related suggestion concerns the land usage. If about 30% area of Nepal - which today, I understand, constitutes either a sum of wasteland or under-used lands - is brought into fresh forest cover, it would mean 4.5 million hectares of land wherethere could be 600 million trees of various species. In terms of economic return, evidently today the figures are that one cft of Salwood timber of Nepal origin fetches at least 150 USD in the international market (while that of other origin at lower prices). Other species would fetch less but would yield faster. This could alsobe advantageous (imagine an 8-year cycle of harvesting in case of a softwood specie called “Popular”). It may be that a combination of the two kinds (long-gestation species and short-gestation ones) could help constitute an ideal model for Nepal. This could attract many billion dollars every year on a sustainable basis since evidently whatever number of trees are harvested in a year, are replanted soon after and the cycle continues.

It seems timely for Nepal to be modeled along the lines of one of the most competitive nations in terms of its per capita income, Switzerland (the country with which its comparison is often drawn in the tourism area) provided that proper policies of international standard (including eco tourism and sustainable tourism) are developed or, for that matter, any other developed nation in the world which has similar potential. What is required, is responsible and due leveraging of core competencies and potential.

For instance, a responsible energy policy is paramount. As regards harnessing the hydel power resources, as well as wind, solar and biomass energy resources, Ibelieve that this may be achieved by using all the information, skills, wisdom and network available to enable this in a prudent and responsible manner. I am informed that to date, out of 83000 MW or so of the feasible potential, not even 1000 MW have been enabled. A holistic approach to realizing this objective, with appropriate scientific involvement, should ensure success provided that any dams are modeled and built in a sustainable manner. I am advised that one challenge lies in convincing the larger hydel power developers in the world to invest. This could be negotiated on a basis that a win-win dispensation is established between Nepal and themselves against a long term power purchase agreement (PPA) which will need to be signed with neighbors who have a deficit of power supplies and are in need ofmuch larger supply than what Nepal may be able to produce (subject to expertdetailed feasibility and sustainability assessment of course). Once this happens,there should be a multiplier effect in the economy with several growth engines active. I am informed that even with an initial harnessing of one third of thepotential in the first phase it will mean more than 500 million units of power every day, benefitting Nepalese lives hugely. A substantial portion of the revenue could be invested in human potential and well-being.

Simultaneously, infrastructure in terms of roads, bridges and all round appropriate development, including cottage industries, can occur. Organized sector jobs which were hitherto few, will be available and slowly many of the young people who have had to move out of the country for financial reasons will be encourages to comeback home and work.

There are indeed many areas where I believe that sound contributions may bemade in Nepal, based upon my experience, including in the context of the reputation and perception of the country. For example, there have been reports relating to money laundering, illicit outflow of funds from Nepal and vice versa, VAT scams, Bank scams etc. These can of course damage a country’s economy and confidence: they are serious issues that need to be addressed with technical expertise. Indeed, there are several reports that point out a very high incidence of illicit financial flows from Nepal, such as that of Global Financial Integrity (GFI) (http://www.ekantipur.com/the-kathmandu-post/2012/12/18/money/capital-flight-8b-siphoned-off-nepal-in-10-yrs-gfi-report/243057.html)   Nepal evidently lost 8 billion US Dollars to illicit outflows in a decade 2001-2010 averaging 800 million Dollars/annum which is high for an economy with a reported GDP of just about 20 billion US Dollars. Nepal is ranked 6th in this report amongst the 48 LDCs (Least Developed Countries studied). This issue requires priority attention, as it does with other economies, to achieve a healthy and sustainable future with proper regulated international banking systems in place.

Written by GFI Lead Economist Dev Kar, the report (published December 2012),entitled “Illicit Financial Flows from the Least Developed Countries”, examines how structural characteristics of LDCs could be facilitating the cross-border transfer of illicit funds, discusses methodological issues underlying estimates of illicit flows and presents an analysis of the magnitude of such flows. Illicit flows seriously impede LDCs’ efforts to raise resources for social and economic development. These flows are often absorbed into banks, tax havens, and offshore financial centers in developed countries. Factors that drive illicit flows from LDCs may be broadly classified into three categories macroeconomic, structural, and governance-related. It is likely that structural and governance issues are driving the bulk of illicit outflows: this needs to be examined on a case-by-case basis. These issues requirecareful handling by professionals and must be addressed to allow for propereconomic progress.

While the UK and Nepal are commemorating 2014 as its Bicentenary year of cooperation I would also like to mention other aspects that are close to my heart.

Whereas economic development in this developing nation assumes prime importance, issues of human dignity, civil liberties and freedom at large, are no less critical. The circumstances in Nepal, as was well known, were problematic until 1990 when democracy was restored. Improvements took some time to evolve and it was only in February 1993 that the world began to have first hand information from Nepal on issues of human rights, civil liberties and freedom at large. This wastwo years after Nepal’s Constitution was amended to allow a free press in the country, as manifested through the vision of Shyam Goenka who founded Kantipur Publications. The impact of a free press was immense. I understand that in fact the newspaper went on to shape the future course of the democracy and work diligentlyto wear off the old legacy. From being a nation whose press was monopolized by the Government, there evolved a vibrant voice of the transforming democratic nation with an impact on all areas of development and the socio-political course as a true growth engine and a catalyst.

Indeed, I now understand that Shyam Goenka is working on another visionaryinitiative for the empowerment of the Nepalese milieu with decentralized newspaper editions using ICT for development across areas of education, healthcare, governance, local development, agriculture, livelihoods, environment, employment avenues, et al in each of the 75 districts of Nepal. This initiative would cater to the aspirations of the residents of all the 35000 odd villages in about 4000 VDCs and should be a worthy experience towards rural empowerment. His aim is to ensure that the newspaper should reach each village in time and the grievances from each village would be brought to the press for publication. The Governmentrepresentatives would respond to such grievances duly addressing those completing the cycle and assisting with positive change. The role of the media in enabling positive change in society has long been understood and recognized. It is to be hoped that in the new era of democracy such an initiative for the people will duly flourish. It is inspiring to recall how the individual spirit and vision can enable positive change for many.

Once again I do hope that Nepal is in every right way on the road to a sustainable, prosperous and healthy future that the nation deserves, honoring its special place in the world.

Dr Linda Spedding holds an LL.B. (Hons), LL.M., Ph.D. She is a Solicitor (England & Wales), and Advocate (India) and an Attorney (USA). Having worked with international law firms, she set up her own practice and remains a consultant to law firms and institutions. Dr. Spedding has authored many articles for professional journals and several books for a professional and business audience, including“Environmental Management for Business”  “Due Diligence and Corporate Governance” and “FDI and Globalisation”. She has been an international advisor to many commercial and professional bodies both in the private and public sector, including SERM and EFR, as well as major development projects. She has served on several committees, including the SCI Business Strategy Committee and the ABA International Section Committee on CSR