The Finance Ministry has published Economic Survey 2012/13. One of the most interesting things in economic survey each year is that it reports the progress on several economic and development fronts (though the latest stats do not cover the entire 12 months of the running year).
The real sector data comes from the CBS, which usually publishes provisional figures well before the economic survey is published. The Central Bureau of Statistics (CBS) released its annual national account estimate on 5 April 2013, projecting GDP at basic prices to grow at 3.56%, down from 4.48% revised estimate for FY2012 (fiscal year ends on 15 July). The CBS projects services sector to grow by 6.03%, industry sector growth to further drop to 1.49%, and agriculture sector to grow by a mere 1.31%.
The sharp drop in agriculture growth is attributed to the unfavorable monsoon and shortage of chemical fertilizers during peak paddy planting season. The industry sector continues to be beset by persistent supply-side as well as structural constraints, including power outages, labor disputes, low productivity, high cost of raw materials and production, inadequate investment climate reforms, lack of innovation and research and development, corruption, and political instability. High services sector growth is supported by demand backed by high remittance inflows.
| GDP_NEPAL | FY2011 | FY2012R | FY2013P |
| GDP growth rate (basic prices) | 3.85 | 4.48 | 3.56 |
| Primary Sector | 4.48 | 4.98 | 1.31 |
| Secondary Sector | 4.4 | 2.96 | 1.49 |
| Tertiary Sector | 3.42 | 4.51 | 6.03 |
| Composition of GDP (%) | |||
| Primary Sector | 37.37 | 36.31 | 35.32 |
| Secondary Sector | 14.94 | 14.30 | 14.35 |
| Tertiary Sector | 47.69 | 49.39 | 50.33 |
Some useful stats (provisional) from the ES (FY2013):
Real sector (GDP growth has declined; domestic savings are down but national savings are up due to high inflow of remittances; so is per capita GNDI)
- Per capita GDP: US$717
- Per capita GNI: US$721
- Per capita GNDI: US$926
- Gross domestic savings: 9.3% of GDP
- Gross national savings: 38.4% of GDP
- Gross fixed capital formation: 21.2% of GDP
- Total population: 27.2 million
- Inflation: 10.6%
Fiscal sector (revenue growth has declined; government expenditure growth has increased; tax revenue has increased; budget deficit is up; external loans are up)
- Revenue growth: 18.5%
- Revenue: 17% of GDP
- Tax revenue: 14.8% of GDP
- Government expenditure: 23.8% of GDP
- Budget deficit: 3.7% of GDP
- Domestic borrowing: 2.2% of GDP
- External loan: 1.5% of GDP
- Public debt: 30.1% of GDP
- Outstanding domestic debt: 12.4% of GDP
- Outstanding external debt: 17.6% of GDP (or 103.6% of revenue; 587% of exports)
Monetary sector (total credit growth down; growth of credit to private sector up; money supply decreased)
- Total credit growth: 8.9%
- Growth of credit to private sector: 15.6%
- Money supply (M2) growth: 6.2%
- Total loans: 63.7% of GDP
- Total loans to private sector: 55% of GDP
- Money supply: 70.6% of GDP
External sector (export growth down; import growth up; trade deficit up; tourism income growth down; remittance income growth down; current account surplus down; balance of payments surplus down)
- Merchandise export growth: 4.2%
- Merchandise import growth: 20.4%
- Merchandise trade deficit growth: 23.5%
- Merchandise export: 4% of GDP
- Merchandise import: 29% of GDP
- Merchandise trade deficit: 24.9% of GDP
- Tourism income growth: 4%
- Tourism income: 1.7% of GDP
- Remittances growth: 19.6%
- Remittances: Rs 430 billion (22.4% of GDP)
- Current account balance: 1.4% of GDP
- Balance of payments: Rs 11.8 billion
- Foreign exchange reserve: Rs 453.6 billion (10.2 months of goods import or 8.7 months of import of goods and non factor services).
The annual comparison is more revealing when the full year fiscal sector, monetary sector and external sector data are released around end of August. Right now, the data is good to observe any interesting as well as alarming trends.
Performance of public enterprises (PEs) in FY2012:
- Of the 37 PEs, 15 made profit and 21 made loss. One did not do any transaction. 8 PEs that earned profit last year made losses this year.
- Total loss incurred by PEs reached Rs 3.49 billion in FY12, compared to profit of Rs 6.69 billion recorded a year earlier.
- NOC and NEA reported loss of Rs 9.52 billion and Rs 9.94 billion, respectively, in FY2012. Combined loss is 1.27% of GDP in FY2012.
- The government has recently decided to pay off the staff of Janakpur Cigarette Factory (Rs 2 billion needed) and is considering doing the same at Nepal Drugs Company in order to liquidate them.
- Pension related obligations increased by 25.9% to Rs 21.2 billion from Rs 16.8 billion a year earlier.
- Political interference and growing unionization are eroding competitiveness
- Excess number of staff needs to be downsized and productivity boosted to remain relevant and financially afloat.
