Nepal: Strengthening Capacity for Macroeconomic Analysis

Sovereign Project | 41126-012 Status: Closed


The TA objective is to enhance both institutional and human resource capacity of key government agencies in developing and using macroeconomic models and improve the national statistical system.

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Project Name Strengthening Capacity for Macroeconomic Analysis
Project Number 41126-012
Country Nepal
Project Status Closed
Project Type / Modality of Assistance Technical Assistance
Source of Funding / Amount
TA 7165-NEP: Strengthening Capacity for Macroeconomic Analysis
Technical Assistance Special Fund US$ 675,000.00
Strategic Agendas Inclusive economic growth
Drivers of Change Governance and capacity development
Sector / Subsector

Public sector management - Economic affairs management

Gender Equity and Mainstreaming No gender elements
Description The TA objective is to enhance both institutional and human resource capacity of key government agencies in developing and using macroeconomic models and improve the national statistical system.
Project Rationale and Linkage to Country/Regional Strategy

Institutional capacity for economic policy analysis in Nepal is weak and as a result, public policy formulation is often not based on a sound analytical foundation. The need for sound economic policy analysis has become even more critical over the years in view of the stagnating economic growth and for better understanding the evolving structure of Nepal?s economy, its increasing complexity and the interactions between different economic sectors. Economic policy analysis has also been constrained by Nepal?s weak national statistical system, particularly the lack of quality and timely macroeconomic data.

Given the importance of reliable and timely macroeconomic data for policy analysis, ADB has also been assisting the Government in strengthening Nepal?s weak statistical system. Recent assistance in this respect includes: (i) TA 3451-NEP (completed in 2004): Strengthening the National Statistical System, which helped in developing a consolidated national statistical plan (CNSP), and improving compilation of the NA, agriculture statistics development and poverty monitoring, and (ii) TA 4460-NEP: Strengthening the National Accounts System (near completion), which supported migration of the national accounts to the System of National Accounts (SNA) 1993, benchmarking and rebasing the national accounts estimates, and development of a system of compiling quarterly national accounts. Also, a diagnostic study was conducted on Nepal?s statistical system under RETA 6333: Statistical Capacity Building in the Asia Pacific Region, which recommended adoption of the CNSP without further delay and identified a broad range of long-term statistical capacity building (SCB) needs of the Central Bureau of Statistics (CBS, the main statistical agency) and other Government agencies.


Economic policies based on an improved statistical system (national accounts) and sound quantitative

macroeconomic analysis.

Project Outcome
Description of Outcome

Component A:

(i) A more conducive legal and institutional environment for improving the national statistical


(ii) A system of QNAcompilation established.

Component B: Macroeconomic tools developed for short- to medium-term macroeconomic forecasting and policy analysis.

Progress Toward Outcome

While the legal and institutional reforms are still underway, the system of compiling QNA data has been streamlined.

NMEM is institutionalized and the DSGE model finalized.

Implementation Progress
Description of Project Outputs

Component A: Enactment of the new Statistical Act, more autonomous CBS, and more functional

National Statistical Council (NSC)

Component A: Quarterly GDP estimates for FY2007 FY2010

Component B: Upgrade of the Nepal Macroeconomic Model (NMEM)

Compoent B: A Dynamic Stochastic General Equilibrium (DSGE)-type model developed for Nepal

Component B: User manual to undertake the quantitative macroeconomic analysis and forecasting

Status of Implementation Progress (Outputs, Activities, and Issues)

- Draft Statiscal Act being submitted to the Cabinet.

- Quarterly GDP estimates for all sectors completed.

- User manual to undertake the quantitative macroeconomic analysis and forecasting prepared.

- DSGE model finalized and submitted to NRB.

- Upgradation of the NMEM completed.

Geographical Location Kathmandu
Summary of Environmental and Social Aspects
Environmental Aspects
Involuntary Resettlement
Indigenous Peoples
Stakeholder Communication, Participation, and Consultation
During Project Design The project was included in the country program on the request of the Government (mainly Central Bureau of Statistics and Nepal Rastra Bank). The TA was prepared in full consultation with the Government agencies.
During Project Implementation Ongoing.
Business Opportunities
Consulting Services

Individual Consultants will be recruited under the TA.

Component A: Developing a System of Quarterly National Accounts

National Accounts Expert (International, 4 person-months)

National Accounts Expert (National, 5 person-months)

Agriculture Statistician (National, 4 person-months)

Component B: Macroeconomic Modeling

Macroeconomic Modeling Specialist (International, 6 person-months)

Macroeconomic Modeling Specialist (National, 5 person-months)

Econometrician (National, 5 person-months)

Information Technology Specialist (Nationial, 2 person-months)

Responsible ADB Officer Raju Tuladhar
Responsible ADB Department South Asia Department
Responsible ADB Division Nepal Resident Mission
Executing Agencies
Nepal Rastra Bank
Ram Sharan Kharel,
Central Bureau of Statistics
Uttam Narayan Malla
Concept Clearance 14 May 2008
Fact Finding 07 Jul 2008 to 25 Jul 2008
Approval 04 Nov 2008
Last Review Mission -
PDS Creation Date 23 May 2008
Last PDS Update 28 Sep 2012

TA 7165-NEP

Approval Signing Date Effectivity Date Closing
Original Revised Actual
04 Nov 2008 26 Nov 2008 26 Nov 2008 31 Oct 2010 31 Aug 2011 -
Financing Plan/TA Utilization Cumulative Disbursements
ADB Cofinancing Counterpart Total Date Amount
Gov Beneficiaries Project Sponsor Others
675,000.00 0.00 150,000.00 0.00 0.00 0.00 825,000.00 04 Nov 2008 520,131.03

Safeguard Documents

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None currently available.

Evaluation Documents

See also: Independent Evaluation

None currently available.

Related Publications

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