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Nepal Development Update, April 2024: Nepal’s Economy on a Recovery Path but Private Investment Remains Low

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dc.contributor.authorWorld Bank
dc.date.accessioned2024-04-01T14:11:26Z
dc.date.available2024-04-01T14:11:26Z
dc.date.issued2024-04-02
dc.description.abstractNepal’s economy saw improved growth in the first half of FY24 (H1FY24) compared to FY23, supported by the services sector, helping its economic growth rebound from a low of 1.9 percent in FY23 to a forecast of 3.3 percent in FY24. Accommodation and food services led the way, fueled by a significant rise in tourist arrivals. Financial and insurance activities also expanded, although there was a contraction in wholesale and retail trade. The industrial sector contributed to growth as well, supported by higher hydroelectric production. In agriculture, there was an increase in paddy production, aided by improved seed availability and favorable weather conditions. Private consumption drove growth on the domestic demand side, supported by a substantial increase of remittance inflows. However, since H1FY21, remittances growth has not supported higher imports of consumption goods. Private investment remained sluggish, as evidenced by decreased imports of capital and intermediate goods. On the other hand, public consumption and investment contracted, driven by austerity measures and lower revenue collection. To mitigate the revenue shortfall, the government adjusted its FY24 budget downward through mid-term reviews, revising both revenue and spending targets. Moreover, there is also the need for improved budget execution efficiency, especially for sub-national governments whose budget execution rates have lagged the federal government’s. Despite a small increase in public debt, it remains moderate and sustainable, supported by a significant share of concessional external loans and prudent fiscal management.en
dc.identifierhttp://documents.worldbank.org/curated/en/099040124010511219/P5009101408e8a09d1aa2d1d52cd32db742
dc.identifier.doi10.1596/41336
dc.identifier.urihttps://hdl.handle.net/10986/41336
dc.languageEnglish
dc.language.isoen_US
dc.publisherWashington, DC: World Bank
dc.rightsCC BY-NC 3.0 IGO
dc.rights.holderWorld Bank
dc.rights.urihttps://creativecommons.org/licenses/by-nc/3.0/igo
dc.titleNepal Development Update, April 2024en
dc.title.subtitleNepal’s Economy on a Recovery Path but Private Investment Remains Lowen
dc.typeReport
dspace.entity.typePublication
okr.crossref.titleNepal Development Update, April 2024: Nepal’s Economy on a Recovery Path but Private Investment Remains Low
okr.date.disclosure2024-04-02
okr.date.lastmodified2024-04-01T00:00:00Zen
okr.doctypeEconomic & Sector Work
okr.doctypeEconomic & Sector Work::Economic Updates and Modeling
okr.docurlhttp://documents.worldbank.org/curated/en/099040124010511219/P5009101408e8a09d1aa2d1d52cd32db742
okr.guid099040124010511219
okr.identifier.docmidP500910-408e8a6c-9fda-439d-aa2d-d52cd32db742
okr.identifier.doihttps://doi.org/10.1596/41336
okr.identifier.externaldocumentum34292557
okr.identifier.internaldocumentum34292557
okr.identifier.report188749
okr.import.id3725
okr.importedtrueen
okr.language.supporteden
okr.pdfurlhttp://documents.worldbank.org/curated/en/099040124010511219/pdf/P5009101408e8a09d1aa2d1d52cd32db742.pdfen
okr.region.administrativeSouth Asia
okr.region.countryNepal
okr.topicMacroeconomics and Economic Growth::Economic Forecasting
okr.topicMacroeconomics and Economic Growth::Economic Growth
okr.unitEFI-SAR-MTI-PS-1 (ESAC1)
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