The Challenges for Nepal

It is hard not to notice how Nepal is declining--and fast. Ever since the King was abolished and the Maoist were put into office, this country has regressed in a big way. I must admit, I am a little nervous of the fate of Nepal if something doesn't change. These are the things we have noticed:

1. We went from losing only about 6 hours of electricity a week to 18 HOURS A DAY. The Nepalese people can't do business. In fact, one of Axel's staff members noted that they were very lucky to work there because they have electricity practically all day long. Any other small business is out of luck. The situation is especially sad because Nepal is actually the second richest country for hydroelectric resources. It doesn't make any sense.

Luckily, we recently got a generator. It is a fine thing, but it can not be used on a continual basis. However, I am so thankful that we can use it when needed.

2. Strikes (bandhas) are ramped throughout the city on a daily basis. Just yesterday I tried to get home after going out to lunch with Axel. The ride home should have taken me 20 minutes. However, there were so many strikes throughout the city that everywhere we turned we were denied entry. The entire city was on lockdown. The drive took us 3 hours to get home and even then, my driver had to sweet talk one of the policemen to actually allow us to enter a forbidden area. In fact, the children were stuck at school because the busses could not exit the premises. We have had threats of week-long strikes that shut the entire city down. It has been a great incentive to keep up my food storage.

3. We frequently don't have water. If our tanks empty, we must order water. However, the water company has recently been on strike and therefore, we cannot get water brought to our home.

4. There is currently a garbage strike that been going on for weeks. There are heaps of disgusting garbage piles all throughout the city.

5. Crime has recently increased. In fact, the one thing that was so great about this country is you felt fairly safe. However, we are hearing numerous stories about how people are being beaten and robbed. Just yesterday my maid was robbed and her entire earnings for the month were taken.

6. At the very time when job insecurity is at its height around the world, the Nepalis are forming unions and striking like there is no tomorrow. Daily factories are shut down, offices are padlocked by workers and the general feel is that the unions control the businesses. There is no way FDI will be coming back to Nepal in the next few years if this problem isn't solved, and there is every chance that the businesses that are here will be considering leaving due to this fact. It isn't hard to see where this is going if it continues. Factories close, more people out of work, it is blamed on capitalism and more strikes and unions are formed so more strikes happen and thus more problems.

7. Jobs overseas are drying up. The government says that 17% of the GDP of Nepal comes from remittance (foriegn workers sending money back to Nepal). The true number is probably closer to 25-30%. As the GCC's construction industry slows down, the need for Nepalis working there will also slow down which will mean less money coming back to Nepal, but more workers out of work. Add to this the problem described in #6 and you have the perfect storm.

8. Tourism slowing down? It is low season right now so it is hard to gauge this, but the strikes in Pokhara a few weeks ago that shut down all the hotels and resturaunts stranding all the tourists there didn't help. If things like that continues to arise, then tourist will get the picture that your carefully laid plans to come here could be totally blown away by a strike on the roads or with the hotels. This could really hurt another major source of income for the country.

9. Foriegn Assistance. Not hard to see that NGOs get there money from the US and the EU. DO either of these places have money to spare? It could be a tough sell for Nepal to get shrinking funds, when even if they do get the funds the political insecurity here can't garantee that these funds will wind up in the right place. And let's face it. There is no oil or terrorism here. IF there is money coming out of the US and EU, it will probably go to countries with these two problems. Not the ones we have here.

10. More and more small banks and financial institutions are being granted licenses here. For as small as the banking sector is in Nepal, new banks are opening all the time. Usually by rich investors who feel that opening a new bank is the chic thing to do now, so they have to have one too. Then once the bank is opened, how do you attract such a small minority who believe in banking? By offering 6.5% returns on SAVINGS accounts and loaning out to anyone who has a heartbeat. This is what killed the US, but apparently this is a lesson that has to be learned here first hand. Let's see if any banks default here, but as you can see from the above points, everything is in place to help that happen.

11. The bird flu has just arrived in Nepal.

Believe it or not, I still have a great love for Nepal. If you could visit here and get to know the people you would fall in love with them immediately. For the most part they are kind, hard workers and all want what's best for the country. I suppose that is why it is difficult to see it run into the ground. There is definitely a strange vibe here and the people are on the verge. The verge of 'what' is anyone's guess... However we have to remember that when the US went from being a monarchy to a democracy it took several years, one civil war and a few depressions to get it right. And is it 'right' even now? Did our founding fathers envision what we have now in the US? PACs, career politicians who can rezone voting districts at will, wars started with no clear goals, loss of religion in government, too much religion in government, money flowing from the tax payers to the entire world with no results and to top it all off proof to the world that as much as we sell democracy and capitalism around the world, in most democratic places there is political instability and strife while in place where there are monarchs or emirs security abides and trade happens. Perhaps it is time to re-look at things.

We are all praying for the leaders of Nepal to do a good job and doubly praying for Obama as well.