Project Launch Meeting: Linkages Between Trade, Development and Poverty Reduction

Experts speaking at a programme today stressed that poverty reduction in a country like Nepal is not possible without streamlining and linking trade and development policies with the national poverty reduction strategies.

They viewed that there is a serious need for Nepal to manifest the policy relevance and coherence of international trade on poverty reduction, especially in the light of the fact that Nepal now is a member of the World Trade Organisation (WTO).

The views were expressed during the launch of a project titled 'Linkages Between Trade, Development and Poverty Reduction', which will be implemented in Nepal over the course of next four years.

Making a presentation of the key findings of a preliminary research paper on the issue in the Nepalese context, Dr Yubaraj Khatiwada, Executive Director, Nepal Rastra Bank (NRB), pointed out that trade issues should be addressed adequately in documents such as the poverty reduction strategy paper.

'Trade, investment and industrial policies, including fiscal and monetary policies, should not be formulated in isolation. These policies need to be devised against the core objectives of poverty alleviation,' he opined, adding, 'There have been failures in this regard.'

He also stressed that there is a need to devise proper safety nets and enhance the capacity of the poor to compete in markets, which are in the present day markedly affected by international forces in the context of multilateralism.

He added, 'Strategic interventions should be made to build supply side capacities and capabilities of the poor'. His observations come at a time when Nepal is struggling to take advantage of the market access opportunities offered by the WTO.

During the same occasion, Mr Bharat Bahadur Thapa, Secretary, Ministry of Industry, Commerce and Supplies, said that ongoing discussions in Nepal relating to linkages between trade, development and poverty reduction could not have been better timed.

However, he admitted that there is a lack of adequate assimilation of policy recommendations being made to the government, and that policy updates do not happen to the extent they need to.

Likewise, Dr Posh Raj Pandey, President, SAWTEE, pointed that the effect of liberal trade policies on poverty reduction is still a debated one.

He said, 'Though there are empirical evidences to prove the positive impact of liberal trade policies on poverty reduction, there also are cases in which certain groups of people or sectors have become more vulnerable and marginalised due to international exposure.'

Speaking during the same occasion, Dr Shree Krishna Shrestha, President, Pro Public, said that there is serious dearth of linkages between the macro and micro issues in Nepal. 'Lack of linkages between policies and ground realities have more often than not failed to deliver on the core objectives with which the policies were formulated,' he stressed.

The project in Nepal will be jointly implemented by the Kathmandu-based Pro-Public and South Asia Watch on Trade, Economics & Environment (SAWTEE).

It is also being implemented in fourteen other countries in South Asia, South East Asia, Southern Africa, Eastern Africa and Europe by different local organisations in collaboration with Consumer Unity and Trust Society (CUTS), Jaipur.

The main objective of the project is to look into the various dimensions of the linkages between trade, development and poverty reduction, and to make the ongoing global liberalisation work in favour of the poor.