Emphasis on extending the time for upgrading from least developed countries
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President of the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) Chandra Prasad Dhakal has said that the deadline for Nepal's graduation from the least developed country status, which was set for November 2026, should be extended.
In a meeting with the newly appointed UN Resident Coordinator Lila Peter Yahia in Kathmandu on Friday, Dhakal said that the FNCCI has formally requested a three-year delay to November 2029 based on extensive consultations with the business community as the country is not yet structurally ready for this transition.
President Dhakal also said that the FNCCI is ready to work with the UN to ensure that Nepal's graduation is not just symbolic but sustainable and beneficial to the people.
He clarified that the private sector is making this demand because Nepal did not initially meet the per capita income criteria and only a few have crossed it this year, and economic sensitivity is still high. Our aim is not to stop progress, but to ensure that the upgrading is sustainable and economically transformative,' he said. 'Even though there is liquidity in the banks, the will of private investment is weak. A hasty upgrade at such a time can lead to setbacks.'
He said that Nepal's private sector demand is also relevant in the context of Nepal's request for an additional 3 years, as Least Developed Countries (LDCs) and Bangladesh have also requested for an additional 3 years. Dhakal informed about the challenges faced by small and medium enterprises, noting that about 300,000 agro-based industries may be affected by rising costs and reduction of subsidies in the European market.
In the meeting, the newly appointed UN Resident Coordinator, Leila Peter Yahia, said that the UN has always been positive for a strong partnership with the private sector in Nepal. She opined that the United Nations, World Bank, International Monetary Fund, Nepalese government and private sector could sit down and discuss and reach a conclusion regarding the need to extend the time frame for Nepal's graduation from the least developed country status set for 2026. 'We want Nepal to graduate.' However, the views of key stakeholders are important for this. So let's discuss among all stakeholders,' she said.
Resident Coordinator Yahiya emphasized that Nepal has a young workforce and potential in various sectors, so predictable policies and trust in national institutions are necessary for policy stability for economic development. She also suggested that a strategy should be formulated accordingly for import substitution and export promotion. She was also interested in the upcoming elections and the economic scenario thereafter.
Chairman Dhakal said that in the past, laws were amended at the initiative of the Federation to create policy stability and an investment-friendly environment, and informed that the Federation has urged all political parties to keep the economy at the center in the upcoming elections and ensure that economic priorities remain stable even outside the political cycle.
