Nepal’s economic woes continue to worsen
Nepal’s economy is in dire straits.
While the Nepalese government has declared a three-month state of emergency in the capital Kathmandu, it has been struggling to meet its debts and keep its public finances afloat.
The country’s government has reported $5 billion in losses, with the International Monetary Fund (IMF) warning this week that it would be unable to meet international creditors.
A new report by the Nepali central bank shows the country has lost $6 billion in value in the last five years.
According to the report, about one in every five Nepalis are in poverty.
In the past year, the number of people living below the poverty line has more than doubled, to about 7.3 million.
“We are facing a crisis of structural adjustment,” said Nepal’s finance minister, Ramakant Rajendran.
As the country is already facing serious economic challenges, the government has started taking action to cut the country’s debts.
However, the IMF said it was not clear that the country could meet its debt obligations and that this would have a “disruptive impact” on its development.
It warned that the situation would worsen, with no easy options left, if the economy did not improve by the end of this year.
Despite the dire economic situation, Prime Minister Sher Bahadur Deuba has refused to leave office and has pledged to keep fighting for a better future.
Meanwhile, Nepal’s international creditors, the World Bank and the International Development Association (IDA), have warned that Nepal’s debt would be impossible to repay.
But the government, led by Prime Minister Deuba, has been unable to cut spending to the bone and has instead resorted to a combination of borrowing and tax cuts.
Last week, the Nepal National Congress (NNC) launched a plan to reduce the deficit by $2.8 billion.
However, the plan was quickly rejected by the ruling party, which is dominated by Deuba.