At the fifth virtual meeting of the Trade and Investment Framework Agreement (TIFA) between Nepal and the United States, scheduled for 15 December, Nepal will concentrate on investment promotion and technical assistance from the United States.
The delegation from Nepal and the United States will address issues related to customs and trade facilitation, the preferential programme and technical assistance and intellectual property rights, said Prakash Dahal, Joint Secretary of the Ministry of Industry, Trade and Supplies.
TIFA is a bilateral agreement aimed at expanding trade, growing investment and technical cooperation and improving economic relations between the two countries that Nepal and the US signed in April 2011.
In 2015, the US granted duty-free access to 66 products by enforcing the Trade Preferences Act and later it extended that to 77 products. Nepal will be receiving the facility through 2025.
Commerce Secretary Baikuntha Aryal will lead the Nepali delegation.
According to Dahal, as for the US, its concern is the issue of Customs Valuation Agreement of the World Trade Organization (WTO). The US had in 2016 raised eight points regarding the compliance process and Nepal responded to five of them in 2017.
Although the trade of 77 Nepali products, like carpets, pashmina products and travel goods have been given preference by the US, Nepal has not been able to take advantage of the facility and find a market for them since it has not been able to mass-produce them, enhance the quality and ensure assurance of standard of the listed goods.
Therefore, Nepal is seeking technical support and trade capacity support so that the country can utilise this facility, according to Dahal.
“We have linked technical assistance to enhance trade competitiveness and seek support from the US,” he said. “We have already sent a draft of a concept note for support on technical assistance to promote small and medium entrepreneurship.”
The US has said that they will respond to it after assessing it, he said.
Besides customs valuation, the US has raised concern regarding intellectual property rights in Nepal which includes copyright, patent right and trademark right.
These are under the jurisdiction of the IT Bill which is under consideration in Parliament.
“The US delegation has been saying that it will be easy for the investors if intellectual property rights are investment-friendly,” Dahal said.
The US has also said that they are willing to give suggestions on protecting intellectual property rights, according to him.
Meanwhile, a national payment gateway has been established as it will come into operation soon which will allow international investors to repatriate money easily, he added.
“The US delegation is looking for more clarity regarding it,” he said.
The process and provision for investment promotion will also be discussed for assurance of potential investment in Nepal, Dahal said.
The US is looking for harmonisation of technical measures like lab tests and lab certificate accreditation in the export and import of pork and poultry and discussions on capacity enhancement to meet the required standards during the December 15 meeting, according to Dahal.
As Nepal banned the import of energy drinks, the US is looking for more clarity although Nepal has notified the WTO of this. Nepal has also banned the import of peas, black pepper, betel nuts, dates, from the US and it is expressing its concern as it is against WTO provisions, said Dahal.
According to the Trade and Export Promotion Center, Nepal exported goods worth Rs4.7 billion in the first four months of the current fiscal year to the US, a rise of 21.9 percent compared to the same time period in the last fiscal year as export stood at Rs3.9 billion.
Similarly, imports from the US declined by 41.5 percent during the review period as imports plunged to Rs3.7 billion from Rs6.3 billion.
Exports to the US declined by 12.9 percent in the fiscal year 2019-20 as it stood at Rs9.44 billion from Rs10.85 billion in 2018-19. Similarly, imports from the US sharply increased by 75 percent as the import bill accounted for Rs23.5 billion in 2019-20 from Rs13.43 billion in the previous fiscal year.

Leave a Reply

Your email address will not be published. Required fields are marked *