World Bank Cautions Nepali Economy on Key Risk Factors

While the growth is expected to be strong in the mid-term, WB said the country will need to consider few risk factors in its way forward
Business

News

 
World Bank Cautions Nepali Economy on Key Risk Factors

After the Asian Development Bank (ADB), now the World Bank (WB) released its report on Nepal’s economic growth prospects for the future.

In its latest South Asia economic outlook report on April 07, 2019, WB noted that Nepal is poised for a 6 percent economic growth rate in FY 2018-19.

“In Nepal, GDP growth is projected to average 6 percent over the medium term. The services sector is forecast to benefit from strong tourism and manufacturing will be supported by the opening of Nepal’s largest cement factory next year,” WB said in its release.

While the growth is expected to be strong in the mid-term, WB said the country will need to consider few risk factors in its way forward.

World Bank’s Risk Factors for Nepal Economy include:

  • Constraints in Reform implementation
  • Vulnerability to Natural Disasters
  • Slow-paced reforms to rise private investment, especially foreign investment
  • Resource availability
  • Supporting federalism
  • Hit to Remittance Inflows
  • Sustaining Service delivery
  • Credit constraints as banks limit lending to meet the Credit To Core Capital Plus Deposit (CCD) ratio regulatory limit
  • Fiscal discipline at the local level

“The poverty outlook is especially sensitive to remittance inflows, natural disasters and local level implementation capacity constraints that may hamper service delivery…”

“The transfer of financial management staff over a year ago made it possible for local governments to prepare budgets and receive fiscal transfers of 8 percent of GDP in FY2018/19. However, under-spending of the budget persists,” WB said in its release.

However, WB economic growth projections for Nepal for FY 2019 are below ADB’s expectations of 6.5 percent, IMF’s 6. 5 percent and the government’s own target of 8 percent.

“In Nepal, GDP growth is projected to average 6 percent over the medium term. The services sector is forecast to benefit from strong tourism, and manufacturing will be supported by the opening of Nepal’s largest cement factory next year,” the report added.


Also Read:

April 9, 2019 |

 
The buddha life journey and significance
 
 

 

Subscribe to our Newsletter

Sign up for more inspiring latest news, events, tourism, and more from Nepalisansar.

Read previous post:
Mount Everest Nepal
Survey to Remeasure Mt Everest Height Begins!

Finally, the prestigious project to measure the almighty peak the Mount Everest is set to begin!…Read more

Close