Nation under crises: Stop data manipulation
Kathmandu. The whole world is in chaos and lockdown due to the widespread of the COVID-19 virus. Some countries have been affected in the worst manner, whereas some are sustaining themselves. Nepal is one of the countries that have been suffering more due to the continuous spread of the virus and the lockdown.
An American credit rating company AAM Best has published a ‘Country Risk Report’. In the report, the company has divided the countries at risk in five-tier, with tier 1 being the ones at least risk and tier 5 being the most at risk. The Country Risk Tires (CRTs) are based on economic, political and financial system risks
According to the ‘Country Risk Report’ published by AAM Best, Nepal falls in the ‘Tier Five (CRT-Five) meaning it has been classified as a ‘high-risk country’. The reason behind this has been the high political tension in the country and the financial risks.
As Nepal is highly dependent on India and a 65 percent trade partnership with India, due to the COVID-019 outbreak Nepal’s cross-border imports have been hampered. There is also a temporary shortfall in imports due to the lack of seasonal rainfall in India. Also, the border dispute between Nepal and India is causing political tension in the country,
Similarly, Nepal is very prone to different weather-related natural disasters as well; this also is affecting the country with the virus outbreak as there have been heavy rainfalls all over the country.
Contradictory to the above report Nepal Rastra Bank recently published a report claiming that the Balance of Payment (BOP) has been in profit in the last fiscal year when trade all around the world has been affected and especially in Nepal.
According to the report, the BOP has recorded at a surplus of Rs.282.41 billion. Similarly, Gross foreign exchange reserves have increased by 34.9 percent to Rs.1401.84 billion in mid-July 2020 from Rs.1038.92 billion in mid-July 2019.
Also, domestic credit expanded by 13.6 percent, and the current account deficit decreased by 87.9 percent. Similarly, the trade deficit narrowed down by 16.8 percent, Capital transfer decreased by 8.1 percent and net foreign direct investment (FDI) increased by 49.1 percent.
NRB claims As Nepal’s import continues to decline due to lockdown, the BOP has recorded at a surplus. While the entire world’s trade has been in shambles, it is nothing new to have a decrease in imports; also there has not been any boost in the export made by Nepal.
The report published by NRB is nothing but manipulative, just to show an image of everything being all right while the country is in a problem. The government must focus on the citizen’s health first and then try to find a way to revive the failing economy, rather than publishing reports that highlight surplus that is worthless in the current situations.