Macroeconomic Update: Nepal (August 2016)
This macroeconomic update for Nepal analyzes FY2016 outcomes in real, fiscal, monetary, and external sectors. It forecasts FY2017 GDP growth to increase to 4.8% from 0.8% in FY2016, with inflation projected to decrease to 8.5%.
The robust revenue collection but disappointing expenditure performance resulted in a fiscal surplus. Estimated actual capital spending went down sharply compared to previous years. Increase in remittance inflow and narrowing of trade deficit has contributed to current account surplus swelling up moderately.
The Issue Focus section delves into the efficiency and integrity of public procurement and its effects on accelerating inclusive economic growth. Many medium to large-scale development projects in Nepal are plagued by implementation delays and cost overruns. Efficiency and integrity in public procurement accelerate project implementation which in turn enhances capital spending and positively affects economic growth, innovation, stimulation of private sector activities and job creation. This is vital also to achieve the country’s medium term goal of graduating from LDC category and long-term goal to be a middle income country by 2030.
- Executive Summary
- Macroeconomic Update
- Issue Focus: Efficiency and Integrity in Public Procurement