Kathmandu, September 22:

Despite two high level studies in 1995 and 2002, Nepal’s economic diplomacy has not been enhanced which has directly hit the economy despite the immense potentials ushered in by WTO, SAFTA and BIMS-TEC moves. Changing environment across the globe requires a sense of ownership and participation by the entire ministry of foreign affairs, forging workable mechanisms between the ministry of foreign affairs and line ministries.

“The role of the private sector in enhancing economic diplomacy for trade, investment and employment is significant,” says former finance minister Dr Badri Prasad Shrestha who conducted a study on “Enhancing Economic Diplomacy for Trade, Investment and Employment” for Economic Policy Network, a joint project of the ministry of finance and Asian Development Bank (ADB). The study, done by Dr Shrestha, is the third one. Dr Shrestha, while presenting his paper on the above theme suggested institutional mechanisms by forming a high level body representing the prime minister and ministers which will help in effective decision making and implementation process in enhancing economic diplomacy.

He suggested that the nominal role of embassies and missions should be strengthened with rational allocation of manpower and recourses along with the new responsibility of preparation and implementation of annual programmes to boost promotional activities, independently and in coordination with the private sector with quantifiable targets.

Dr Shrestha suggested reinforcing present multilateral economic affairs division at the MoFA in a full-fledged manner with new functions acting as the hub of economic diplomacy. The government spends Rs 600 million every year in running embassies and missions. In such a context, some practical suggestions are needed for rationalisation of both budget and manpower allocations which together can reduce the present cost and, thus release some resources for financing promotional activities, says Shrestha. He categorically alleged the government saying that it is not prepared to allocate a few millions for the promotion of trade, investment, employment and tourism through our embassies and missions.

Some of the problems faced by Nepal in enhancing economic diplomacy are shortage of manpower with necessary skills and experiences, lack of mechanisms for meaningful partnership with private sector, no full-fledged division for specialisation and coordination within MoFA and lack of initiatives by embassies and missions.