Remittances to Developing Countries Resilient in the Recent Crisis

Remittances to Developing Countries Resilient in the Recent Crisis
World Bank, 8-Nov-2010

Full Report
Nepal Specific Data

Remittances to developing countries were a resilient source of external financing during the recent global financial crisis, with recorded flows expected to reach $325 billion by the end of this year, up from $307 billion in 2009, according to the World Bank’s latest Migration and Remittances Factbook 2011. Worldwide, remittance flows are expected to reach $440 billion by the end of this year.

The World Bank estimates that, after recovering by the end of this year, recorded remittances to developing countries will rise further in 2011 and 2012, possibly exceeding $370 billion in two years’ time.

“Remittances are a vital source of financial support that directly increases the income of migrants’ families,” said Hans Timmer, director of development prospects at the World Bank. “Remittances lead to more investments in health, education, and small business. With better tracking of migration and remittance trends, policy makers can make informed decisions to protect and leverage this massive capital inflow which is triple the size of official aid flows,” Timmer said.

The top remittance sending countries in 2009 were the United States, Saudi Arabia, Switzerland, Russia, and Germany. Worldwide, the top recipient countries in 2010 are India, China, Mexico, the Philippines, and France. As a share of GDP, however, remittances are more significant for smaller countries—more than 25 percent in some countries.

While high-income countries remain the main source of remittances, migration between developing countries is larger than that from developing countries to high-income countries belonging to the Organisation for Economic Cooperation and Development (OECD).

Regionally, there is significant variation across developing regions, with larger-than-expected falls in remittances to Europe and Central Asia[1], Latin America and the Caribbean, the Middle East and North Africa, and Sub-Saharan Africa regions in 2009. Flows to South Asia in 2009 grew more than expected, and those to East Asia and Pacific rose modestly.

“Remittances in 2008 and 2009 became even more of a lifeline to poor countries, given the massive decline in private capital flows sparked by the crisis,” said Dilip Ratha, manager of the migration and remittance unit at the World Bank. “However, high unemployment is prompting many migrant-receiving countries to tighten immigration quotas, which would probably slow the growth of remittance flows. Also uncertain currency movements can have unpredictable effects on remittance flows,” Ratha added.

In addition to crisis-related risks, there are major structural and regulatory changes in the global remittance market. Regulations to combat financial crime have become a roadblock to the adoption of new mobile money transfer technologies for cross-border remittances. “There is urgent need to reassess regulations for remittances through mobile phones and mitigate the operational risks,” Ratha said.

According to the Factbook 2011, the top migrant destination country is the United States, followed by Russia, Germany, Saudi Arabia, and Canada. The top immigration countries relative to population are Qatar (87 percent), Monaco (72 percent), the United Arab Emirates (70 percent), Kuwait (69 percent), and Andorra (64 percent). Mexico–United States is expected to be the largest migration corridor in the world this year, followed by Russia–Ukraine, Ukraine–Russia, and Bangladesh–India.

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Malaysia shuts door for Nepali security guards

Malaysia shuts door for Nepali security guards
Myrepublica, 23-Dec-09
PRABHAKAR GHIMIRE

The Malaysian government has decided to replace Nepali security guards, following immense pressure from local organizations. Nepali security guards were under the top priority of Malaysian firms since the last two years.

The recent move of the Malaysian government means there will only be a slim chance for Nepali security guards to get job opportunity in the booming South East Asian nation on the back of low demands due to global financial meltdown.

Kumud Khanal, coordinator of Nepali manpower agencies sending workers to Malaysia, said over 10,000 aspirants, who were making final preparation to work as security guard in Malaysia, will be affected by the decision. Khanal said 70,000 Nepali workers are working as security guards in Malaysia -- the second largest job market for Nepal after Saudi Arabia.

“The fresh move of the Malaysian government will affect over 10,000 Nepali workers, who had been preparing to leave for Malaysia. Furthermore, there will be no extension of three-year working period of existing security guards,” Khanal said. Khanal´s agency alone was preparing to send some 5,000 security guards to Malaysia.

Khanal said involvement of Nepali security guards in criminal activities, low English language skills and the trend of sending youths having no police and military service background were the major reasons that prompted the Malaysian government to take the decision.

Malaysia´s Barnama this week stated that local security service agencies have agreed to recruit members of Civil Defense Department (JPAM) and People´s Volunteer Crops (Rela) in place of foreign security guards, particularly those from Nepal.

“As JPAM and Rela have trained volunteers, there was no reason for the country to rely on foreign security guards, especially those from Nepal,” the news agency quoted Director-General of JPAM, Datuk Abdul Halim Abdul Hamid, as saying. "We held several discussions and meetings with the Security Services Association of Malaysia. At the end of the talks, they (association) agreed to take JPAM and Rela members as security guards."

Speaking to mediapersons, secretary general at Malaysian Home Ministry Datuk Seri Mahmood Adam proposed to use over a million JPAM and Rela members to replace foreign security guards. Adam also said replacement of foreign security guard would be expanded nationwide, according to the agency.

According to the news reports, JPAM currently has about 80,000 members which will increase to 100,000 by the year-end. Rela has over one million trained workers and the number is expected to reach 2.5 million by the end of next year. JPAM and Rela leaders have also assured that the recruiting companies need not give intensive training to their members.

Responding to rising unemployment, Malaysia has been closing fresh recruitments in service and manufacturing sector - two major sectors hit hard by the global financial meltdown.

Tilak Ranabhat, president of Nepal Association of Foreign Employment Agents (NAFEA), said the Malaysian government took the decision to replace foreign workers, especially Nepalis, with local youths, bowing to pressure from local organizations. Ranabhat, who is also involved in sending Nepalis to Malaysia, said a Nepali guard can earn at least Rs 30,000 per month in Malaysia.

According to Department of Foreign Employment, a total 20,619 Nepalis left for Malaysia during the first four months of current fiscal year, down from 21,593 recorded during the same period last year.

Foreign employment on the rise

Foreign employment on the rise
Nepalnews, 22-Dec-09

The number of Nepalis flying abroad for employment has surged in the last one month.

This upward spiral can be ascribed to rising demand of Nepali workers in countries like Malaysia, Saudi Arabia and Qatar.

According to Department of Foreign Employment (DoFE), 17,434 Nepalis left the country for different destinations from mid-November to mid-December, a 17.18 percent increase compared to 14,877 job seekers leaving during mid-October to mid-November.

Last year during mid-November to mid-December, 14,200 Nepalis had left the country seeking employment in various countries.

Number of individuals leaving for Malaysia was 7,646 while 5,218 flew to Saudi Arabia and 2,510 to Qatar.

From mid-October to mid-November, 6,335 Nepalis flew to Malaysia, 2,293 to Qatar and 3,630 to Saudi Arabia.

According to the DoFE, number of individuals leaving for work through their own contacts also has soared. During mid-November to mid- December, a total of 7,171 individuals including 1,029 female workers migrated to 35 countries. The number of women leaving for work through personal contacts was 696 during mid-October to mid-November.

However, the number of females leaving through agencies has decreased to 352 from 425 in mid-October to mid-November period.

The decrease is attributed to the ban imposed by Lebanon for domestic workers and Israel, one of the most lucrative destinations for Nepali female workers, delaying to re-open its door for migrant workers.

How the Stimulus Bill affects H1B visas, Greencards

IndiaPost.com, 19-Feb-09

What does the Stimulus Bill (American Recovery and Reinvestment Act of 2009) say about H-1 hiring and about green cards? Maryland-based attorney Rajiv S. Khanna, who runs an online immigration forum, explains:

1. If an employer receives TARP funding they can hire NEW H-1B workers only if they comply with certain requirements. Note that existing H-1 workers are not affected. Note also that there is no effect on existing or future green card applications of such employers.

2. These requirements are already in place for employers whose workforce contains a substantial number of H-1 workers. These employers are referred to as H-1B DEPENDENT employers.

3. The additional requirements that TARP accepting companies have to follow are: (a) They must not displace U.S. workers in similar positions nor may they place H-1B employees at places where such displacement has or will occur; (b) They must have made good faith efforts to recruit US workers (there is a whole bunch of regulations on how we are supposed to do this; and (c) TARP employers are bound by these requirements even if they hire exempt workers. An exempt worker is one who makes at least $60,000/year OR possesses a Master’s or higher degree in his/her filed. Normally the additional requirements of non-displacement and good faith recruitment do NOT apply with respect to exempt H-1B workers. Nevertheless, the Bill says, this exemption is not available for TARP recipients.

4. This restriction on hiring H-1B workers will stay in effect for two years after the President signs the Bill.

5. There appears to be no change regarding L-1 provisions.

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Laid-Off Foreigners Flee as Dubai Spirals Down

New York Times, 11-Feb-09
Robert T Worth

Sofia, a 34-year-old Frenchwoman, moved here a year ago to take a job in advertising, so confident about Dubai’s fast-growing economy that she bought an apartment for almost $300,000 with a 15-year mortgage.


Now, like many of the foreign workers who make up 90 percent of the population here, she has been laid off and faces the prospect of being forced to leave this Persian Gulf city — or worse.

“I’m really scared of what could happen, because I bought property here,” said Sofia, who asked that her last name be withheld because she is still hunting for a new job. “If I can’t pay it off, I was told I could end up in debtors’ prison.”

With Dubai’s economy in free fall, newspapers have reported that more than 3,000 cars sit abandoned in the parking lot at the Dubai Airport, left by fleeing, debt-ridden foreigners (who could in fact be imprisoned if they failed to pay their bills). Some are said to have maxed-out credit cards inside and notes of apology taped to the windshield.

The government says the real number is much lower. But the stories contain at least a grain of truth: jobless people here lose their work visas and then must leave the country within a month. That in turn reduces spending, creates housing vacancies and lowers real estate prices, in a downward spiral that has left parts of Dubai — once hailed as the economic superpower of the Middle East — looking like a ghost town.

No one knows how bad things have become, though it is clear that tens of thousands have left, real estate prices have crashed and scores of Dubai’s major construction projects have been suspended or canceled. But with the government unwilling to provide data, rumors are bound to flourish, damaging confidence and further undermining the economy.

Instead of moving toward greater transparency, the emirates seem to be moving in the other direction. A new draft media law would make it a crime to damage the country’s reputation or economy, punishable by fines of up to 1 million dirhams (about $272,000). Some say it is already having a chilling effect on reporting about the crisis.

Last month, local newspapers reported that Dubai was canceling 1,500 work visas every day, citing unnamed government officials. Asked about the number, Humaid bin Dimas, a spokesman for Dubai’s Labor Ministry, said he would not confirm or deny it and refused to comment further. Some say the true figure is much higher.

“At the moment there is a readiness to believe the worst,” said Simon Williams, HSBC bank’s chief economist in Dubai. “And the limits on data make it difficult to counter the rumors.”

Some things are clear: real estate prices, which rose dramatically during Dubai’s six-year boom, have dropped 30 percent or more over the past two or three months in some parts of the city. Last week, Moody’s Investor’s Service announced that it might downgrade its ratings on six of Dubai’s most prominent state-owned companies, citing a deterioration in the economic outlook. So many used luxury cars are for sale , they are sometimes sold for 40 percent less than the asking price two months ago, car dealers say. Dubai’s roads, usually thick with traffic at this time of year, are now mostly clear.

Some analysts say the crisis is likely to have long-lasting effects on the seven-member emirates federation, where Dubai has long played rebellious younger brother to oil-rich and more conservative Abu Dhabi. Dubai officials, swallowing their pride, have made clear that they would be open to a bailout, but so far Abu Dhabi has offered assistance only to its own banks.

“Why is Abu Dhabi allowing its neighbor to have its international reputation trashed, when it could bail out Dubai’s banks and restore confidence?” said Christopher M. Davidson, who predicted the current crisis in “Dubai: The Vulnerability of Success,” a book published last year. “Perhaps the plan is to centralize the U.A.E.” under Abu Dhabi’s control, he mused, in a move that would sharply curtail Dubai’s independence and perhaps change its signature freewheeling style.

For many foreigners, Dubai had seemed at first to be a refuge, relatively insulated from the panic that began hitting the rest of the world last autumn. The Persian Gulf is cushioned by vast oil and gas wealth, and some who lost jobs in New York and London began applying here.

But Dubai, unlike Abu Dhabi or nearby Qatar and Saudi Arabia, does not have its own oil, and had built its reputation on real estate, finance and tourism. Now, many expatriates here talk about Dubai as though it were a con game all along. Lurid rumors spread quickly: the Palm Jumeira, an artificial island that is one of this city’s trademark developments, is said to be sinking, and when you turn the faucets in the hotels built atop it, only cockroaches come out.

“Is it going to get better? They tell you that, but I don’t know what to believe anymore,” said Sofia, who still hopes to find a job before her time runs out. “People are really panicking quickly.”

Hamza Thiab, a 27-year-old Iraqi who moved here from Baghdad in 2005, lost his job with an engineering firm six weeks ago. He has until the end of February to find a job, or he must leave. “I’ve been looking for a new job for three months, and I’ve only had two interviews,” he said. “Before, you used to open up the papers here and see dozens of jobs. The minimum for a civil engineer with four years’ experience used to be 15,000 dirhams a month. Now, the maximum you’ll get is 8,000,” or about $2,000.

Mr. Thiab was sitting in a Costa Coffee Shop in the Ibn Battuta mall, where most of the customers seemed to be single men sitting alone, dolefully drinking coffee at midday. If he fails to find a job, he will have to go to Jordan, where he has family members — Iraq is still too dangerous, he says — though the situation is no better there. Before that, he will have to borrow money from his father to pay off the more than $12,000 he still owes on a bank loan for his Honda Civic. Iraqi friends bought fancier cars and are now, with no job, struggling to sell them.

“Before, so many of us were living a good life here,” Mr. Thiab said. “Now we cannot pay our loans. We are all just sleeping, smoking, drinking coffee and having headaches because of the situation.”

Related Story
Escape to Dubai (New York Magazine, 24-Nov-08)

NRB: Remittance up despite global blues

NRB: Remittance up despite global blues
ekantipur, 2-Feb-09

Despite a global recession, the inflow of remittances increased by 65.8 percent during the first five months of the current fiscal year, according to a report on the latest micro-economic situation of the country released by Nepal Rastra Bank (NRB) on Monday.

The surge in remittances contributed to a surplus in the current account of Rs. 12.3 billion from a deficit of Rs. 7.5 billion during the same period last year. The growth of remittance flow was 17.6 percent last year.

However, recent moves by Malaysia and the United Arab Emirates (U.A.E.) to discourage foreign workers might affect remittances in the future. Remittances account for 17.4 percent of Nepal's Gross Domestic Product (GDP).

The balance of payments also recorded a significant surplus of Rs. 22.8 billion during the first five months of the current fiscal year compared to a surplus of Rs. 31.1 million during the same period last year.

According to NRB, the country's exports also grew by 30.9 percent during the period against a decline of 4.4 percent during the same period last year. Exports to India grew by just 15.1 percent compared to a 64 percent rise in third country exports.

An increase in the export of readymade garments, shoes and sandals, tooth paste, G.I. pipes and noodles was primarily responsible for the increase in exports to India. A surge in the export of pulses, woollen carpets, pashmina, readymade garments and herbs accounted for the tremendous growth in third country exports.

Likewise, imports also grew by 32.6 percent this year against an increase of 8.2 percent last year. Imports from India were up by 17.1 percent compared to 57.2 percent for third country imports. Inflation rose to 14.1 percent this year against 5.7 percent last year, according to the central bank.

During the five-month period under review, the government budget showed a surplus of Rs. 2.2 billion against a deficit of Rs. 9.8 billion previously. An increase in revenue and foreign cash grants accounted for the budget surplus during the period.

Domestic credit was up 6.5 percent compared to a growth of 10.4 percent last year. NRB stated that low government expenditure contributed to the slowdown in the growth of domestic credit in the review period.

The growth of private sector credit also went down marginally during the first five months of the current fiscal year compared to the corresponding period last year. Credit to the private sector increased by 10.1 percent this year against 10.9 percent last year, according to NRB.

Nepalis in UAE set to lose jobs

Nepalis in UAE set to lose jobs
ekantipur, 1-Feb-08

Much to the astonishment of many Nepali workers, the government of United Arab Emirates (UAE) has decided to cut the number of foreign workers by 45 percent.

Nepali workers are expected to be worst hit by this decision. However, no news of sacking Nepali workers has come out till this report was prepared. Hundreds of thousands of Nepali workers have been working in the major cities of UAE.

According to an official of UAE's Foreign Ministry, the decision to cut the number of workers has been taken after the negative shock of economic recession has gripped UAE.

It is learnt that UAE will begin the process to bring down the number of workers within few days as the government has already ordered companies not to recruit new workers and to gradually bring down the number of old workers.

Meanwhile, Nepali workers are a worried lot, fearing that they might have to return home empty hand. Some have appealed to companies, asking them not to give lay off to Nepali workers.

The Nepali Embassy here has urged the Government of Nepal to raise the voices of Nepali workers so that the companies could reconsider their decision.

Remittance drop to hit land price

Remittance drop to hit land price
ArthaExpress, 30-Dec-08

The zooming price of land will slow down within coming 10 months but not go kaput, predict experts.

“The whopping rise in land prices will slow down in the coming 10 months,” said Ganesh Gurung, a sociologist who has been studying the remittance aspect, at an interaction on ‘Global financial crisis and its impact on Nepali migrant workers’ organised by the Nepal Association of Foreign Employment Agencies (NAFEA) here today.

Land prices in the valley have been climbing up due to violence in the Tarai and the remittances that Nepali migrant workers send home. “Malaysia and the Gulf countries have started feeling the heat of the global financial crisis,” he said adding that big construction companies in the Gulf and garment factories in Malaysia as well as construction, industry and service sectors — supported by foreign direct investment (FDI) — have started laying off unskilled workers, including Nepalis.

“FDI in Malaysia has dropped by 50 per cent and they are laying off unskilled workers like Nepalis,” said Dr Chiranjivi Nepal, an economist and former chairman of Securities Board of Nepal.

“Some of the companies which had sent orders for new workers, are now requesting to delay it,” said an entrepreneur voicing serious concern at the state of the labour market in Gulf and Malaysia and remittance that is the lifeline of Nepal’s economy.

“The government is behaving as if nothing has happened,” accused Dr Nepal adding that even a strong economy like India is also serious about the crisis. It has announced various stimulous packages to mitigate the impact of the global financial crisis.

Dr Nepal said that every country except Nepal has devised its own strategy to cope with this global crisis. Remittance supports over 60 per cent of Nepal’s import. “If the remittance goes down, it will hit imports making it hard for the government to meet the revenue target,” he said.

The government should form a high-level monitoring committee to day-to-day access the remittance flow through the Malaysia-Nepal corridor and Japan-Nepal corridor, suggested Gurung. “As a temporary measure, Nepal can diversify the labour market as the high concentration in the Gulf and Malaysia might have an adverse effect on our economy. Diversifying would cushion the shock,” he added.

NAFEA president Tilak Bahdur Ranabhat dwelt on the various problems the manpower agencies are facing and urged the government to help them sort out problems in the remittance business that contributes around 17.4 per cent to the total gross domestic product (GDP). “The delay in appointing a labour attache has also caused various problems for working in those countries,” he said.

According to official data, 656 Nepalis leave the country every day for greener pastures in other countries, mainly in the Gulf and to Malaysia.

Roughly, Rs 38,90,41,095 flows into Nepal as remittance everyday. Almost 2.5 million Nepalis — 1.2 million official and 1.3 million unofficial figures — work in various countries across the globe, according to Ranabhat.

“Money sent home by one worker maintains a four-member family here. This makes it a total of 10 million people dependent on remittance,” he added.

The 10-year long conflict also played a key role in forcing people to go abroad for jobs.

At the begining of the conflict, per household used to receive Rs 15,160 per month remittance but at the end of the conflict it crossed Rs 34,698, according to Gurung’s study.

No impact of global meltdown yet: Govt

No impact of global meltdown yet: Govt
ekantipur, 29-Dec-08

While foreign employment agents and economists have been warning that the global financial crisis would severely affect employment of Nepali youths abroad, government officials maintain that the country has not witnessed any impact yet.

Krishna Hari Baskota, revenue secretary at the Ministry of Finance, said on Monday that layoffs in the job destinations had been limited to highly paid employees and workers in the lower rungs were untouched. “As Nepali migrant workers fall under the second category, it is unlikely that they will lose their jobs en masse,” he told an interaction on the global financial crisis and its impact on foreign employment.

He said that the government was watching the developments in the world economy very closely so that it could take appropriate and timely measures. He added that there was no need for panic as the crisis was yet to be felt in Nepal.

However, foreign employment agents said that the situation was beginning to look bad for Nepali workers as companies in the job destinations had stopped giving overtime work, and some had started discharging their employees before their contracts expired.

Talak Bahadur Ranabhat, president of the Nepal Association of Foreign Employment Agencies, said that thousands of foreign workers were being laid off in the Gulf countries and that Nepalis were starting to feel the heat. “As a result of the world financial crisis, the future of foreign employment agencies is also at stake,” he said. He added that the country was receiving Rs. 389 million in remittances daily, and that the economy will suffer if the inflow were to decline.

Ganesh Gurung said that the fallout of the crisis on Nepal's economy would begin from the Gulf and Malaysia with massive job cuts of foreign workers there.

“Its impact will be seen in the transactions of financial institutions and the real estate business as remittances have been one of their main sources of funds,” he said. Explaining the impact of remittances on the livelihoods of people, he said the annual household income from remittances reached Rs. 34,698 at the end of conflict period compared to Rs. 15,160 at its beginning.

Economist Dr. Chiranjeebi Nepal blamed the government for doing nothing to insulate the country from possible impacts of the global crisis.

Remittance inflow jumps 80.7 percent

Remittance inflow jumps 80.7 percent
ekantipur, 30-Nov-08

Inflow of remittance from Nepali workers in foreign countries shot up by 80.7 percent during the first three months of the current fiscal year, according to a central bank report released Sunday.

Remittance growth in the first quarter of the previous fiscal year was 17.2 percent, Nepal Rastra Bank (NRB) said.

The big jump in remittance also helped boost the country's overall balance of payments (BOP) during the period pushing it into positive territory after a long time, the report said.

According to the quarterly report on the current macroeconomic situation of the country, Nepal's BoP recovered from a deficit of Rs. 5.6 billion recorded in the first quarter of Fiscal Year 2007/08 to a surplus of Rs. 7.7 billion in the first three months of Fiscal Year 2008/09.

Similarly exports witnessed an upsurge of 27.1 percent during the first quarter of the current fiscal year against a mere 4.3 percent rise in the corresponding period last year. NRB said that exports to both India and third countries swelled this year.

It said exports to India during the period increased by 10.1 percent against a 0.6 percent rise recorded during the corresponding months last year. Likewise, exports to countries other than India swelled by 58.3 percent compared to an increase of 11 perrcent last year.

Exports to India increased due to a rise in export of readymade garments, shoes and sandals, polyester yarn, copper wire rods and G.I. pipes. An upsurge in export of pulses, woolen carpets, pashmina, herbs and tanned skin mainly contributed to an increase in overall exports to third countries.

Meanwhile the country imported 30.6 percent more in the first quarter this year. In the corresponding period last year, imports had gone up 13.1 percent.

Imports from India went up 19.3 percent in the review period, compared to a 13.7 percent rise in the corresponding period last year. NRB attributed the growth to rise in petroleum imports and higher import of vehicles and spare parts, cold rolled steel in coil, hot rolled sheet in coil and cement among other from India.

On the other hand imports from other countries jumped 48.5 percent in the three months while it had grown just 12.1 percent during the corresponding period last year. NRB said higher inflow gold, MS billet, telecom equipment and parts, computers and related products, and polythene granules among others from these countries contributed to the big surge.

During the first three months of the current fiscal year, total government spending decreased by 2.4 percent to Rs. 29.3 billion compared to an increase of 53.7 percent in the corresponding period last year.

The government's failure to make both recurrent and capital expenditures at significant levels resulted in the decline of overall expenditures. Given the relatively huge size of the budget, spending money has remained a big challenge for the government.

Recurrent expenditures increased by 13.2 percent to Rs. 18.5 billion compared to an increase of 35.6 percent in the corresponding period last year.

The government's budget deficit stood at Rs. 2.9 billion compared to a deficit of Rs. 9.4 billion in the corresponding period last year.

At the same time revenue collection saw an increase of 16 percent during the review period to Rs. 22.3 billion. The Ministry of Finance has said on Nov. 21 that revenue collection increased by 35.5 percent between mid-October and mid-November this year. It said Rs 32.97 billion had been collected in revenue in the first four months of this fiscal year. The government aims to increase revenue by 31.7 percent to meet its target of Rs. 142 billion, set for this year.

Domestic credit claims by non-financial government enterprises increased by 6.2 percent over the period compared to a decline of 17.3 percent in the corresponding period last year.

Higher credit claims by government enterprises like Janakpur Cigarette Factory, Nepal Oil Corporation, Nepal Airlines Corporation, Janak Education Material Center and Nepal Electricity Authority contributed to the increase, NRB said.

However, claims on government financial institutions declined by 6.7 percent in the review period. Meanwhile, overall domestic credit increased by 6.8 percent during the period against 6.9 percent recorded in the corresponding period last year.

Gross foreign exchange reserves stood at Rs. 230.8 billion in mid-October, an increase of 8.5 percent compared to a decline of 4.1 percent in the corresponding period last year. The current level of reserves is adequate for financing merchandise imports for 10.1 months, and merchandise and service imports for eight months, according to NRB.

Remittances soar 74pc, exports rebound: NRB

Remittances soar 74pc, exports rebound: NRB
ekantipur, 7-Nov-08

Nepal has witnessed a strong growth in remittance inflow and exports -- two critical sectors of the economy -- in the first two months of the current fiscal year, says a report of Nepal Rastra Bank (NRB).

During the period, the country received Rs. 31.88 billion in remittances from Nepalis working abroad. The figure is a whopping 74 percent rise over the receipts for the same period last year.

The gain has been attributed to an increase in the number of Nepalis leaving for overseas jobs and also to depreciation of the Nepali rupee vis-à-vis the US dollar. During the two months, the number of Nepali foreign workers grew by 17.75 percent and the Nepali currency lost value by 6.48 percent.

Likewise, the country’s total exports bounced back by more than one-third and touched Rs. 13.46 billion in the first two months of 2008/09, compared to a decline of 3 percent in the same period last year.

Of the total exports, sales to India -- Nepal’s largest market - went up by over 12 percent to reach Rs. 7.28 billion. Exports to other countries also soared by 82 percent and amounted to Rs. 6.17 billion.

The NRB report released on Friday has credited the rise to an upsurge in exports of readymade garments, copper wire, tooth paste and zinc sheets to India and increased sales of Nepali pulses, woollen carpets, herbs and pashmina in other countries.

Propelled by strong consumption on the back of greater remittances, Nepal’s total imports also rose by 43.3 percent during the period and touched Rs. 48.22 billion.

“Imports from India grew by over 34 percent to Rs. 26.85 billion and from other countries by 56.5 percent to Rs. 21.37 billion,” says the report.

With imports growing faster than exports, the country’s trade deficit swelled by over 46 percent to reach Rs. 34.76 billion.

The report portrays a gloomy picture for consumers, as consumer inflation rose to 13.5 percent in mid-September 2008 compared to mid-September 2007. Prices of food items and beverages increased by 14.2 percent while non-food items and services went up by 12.8 percent during the period.

“A sharp rise in prices were recorded in the case of sugar, oil, ghee, grains, rice, pulses, restaurant meals, milk and milk products, meat, fish and eggs and spices,” says the report.

The cost of transportation and communication and housing goods and services rose by 23.1 percent and 18.1 percent respectively in mid-September 2008 compared to a year ago.

More Nepalis heading abroad for jobs

More Nepalis heading abroad for jobs
ekantipur, 26-Oct-08

Indicating fewer job opportunities in the country due to a slowdown in the economy, the number of Nepali workers seeking their fortunes overseas went up by 10.9 percent during the first quarter of the current fiscal year 2008/09 as compared to the same period last year.

The destination of most of these jobseekers is the Gulf and Malaysia where a booming real estate sector, rapid expansion in infrastructure and flourishing industries continue to drive demand for blue-collar workers.

According to the data provided by the Department of Labour and Employment Promotion, the number of blue-collar workers departing for different countries during the period mid-July to mid-October rose to 62,769 individuals from 56,589 individuals during the corresponding period of the last fiscal year.

The number of workers headed for Qatar -- the highest-paying destination -- shot up by 11 percent to 22,655 individuals during the period.

Foreign employment entrepreneurs said rapid development of infrastructure and increasing construction projects continued to attract a sizable number of Nepali workers to Qatar.

Malaysia, the second largest destination for Nepal’s migrant labour force, saw a 3 percent rise in arrivals from 13,538 individuals recorded during the same period last year.

The United Arab Emirates (UAE) received 9,019 workers, up 2 percent from 8,809 workers recorded last year.

The number of departures to Saudi Arabia went up by 19 percent to 12,643.

The four major recipient countries -- Qatar, Malaysia, the UAE and Saudi Arabia -- accounted for more than 92 percent of the departures during the period.

A monthly breakdown shows 19,697 departures to various countries during the period mid-September to mid-October, down from 20,245 departures recorded during the previous month.

Qatar maintained its position as the most sought destination receiving 7,529 workers while Saudi Arabia came second taking in 4,953 workers. The number of departures to the UAE and Malaysia reached 2,198 and 3,977 respectively during the month.

Nepali overseas workers double in five years

Nepali overseas workers double in five years
eKantipur, 20-Jul-08
BY PRABHAKAR GHIMIRE

In what may be termed an indication of growing unemployment in the country, the number of Nepali youths moving out for overseas jobs has more than doubled over the past five years.

Slim employment opportunities and greater access to labor destinations amid sprouting manpower agencies has contributed to the soaring number of workers leaving for overseas jobs.

The number of Nepalis going for foreign employment has grown at double-digit steadily over this period. In the fiscal year 2007/08, which ended last week, the number of overseas job goers grew by 20 percent, compared to the previous fiscal year.

Statistics of Department of Labor shows that a total of 239,637 Nepali job seekers left for different destinations - mostly for blue-collar work - during the year. The number was 199,191 during the fiscal year 2006/07.

Only 106,660 workers in total had left for foreign jobs in fiscal year 2003/04.

Officials attribute such a remarkable growth of overseas employment to the positive impact of labor pacts signed by Nepal with four recipient countries.

Over the last two years, Nepal has signed Memorandum of Understanding with the United Arab Emirates (UAE), Korea, Qatar and Bahrain to ensure greater rights of Nepali workers there.

As a result of labor agreements and change in working environment, the preferences regarding different destinations have also changed over the period.

Qatar became the most favored destination for Nepali workers during the last fiscal year receiving 85,411 workers , 47 percent up from the number recorded during a year earlier.

Data shows, Malaysia became the second largest country from most preferred destination in the last fiscal year. It received only 50,526 Nepali workers, which was about 28 percent less than the previous fiscal year.

The United Arab Emirates and Saudi Arabia also witnessed double digit growth in the arrival of Nepali workers.

However, more than 93 percent of the total outgoing workers are concentrated on the largest four recipients due to lack of diversification of labor destinations.

"Lack of employment opportunities within the country has drive up the number of Nepali workers seeking overseas jobs even for meager remuneration," Dilli Ram Sharma, director of Department of Labor and Employment Promotion (DoLEP) told the Post.

"Increasing personal access to the outer world has also helped in finding overseas jobs in recent years, said Sharma.

1.5 million South Asian workers migrate every year: ILO

1.5 million South Asian workers migrate every year: ILO
Xinhua, 14-Jul-08

More than 1.5 million South Asian workers are estimated to migrate every year, many of them destined for the Gulf region to perform construction, maintenance and other service jobs, said the International Labor Organization (ILO).

For protection of the soaring number of the migrant workers from South Asia, a two-day regional symposium will be held here on July 15-16, private news agency UNB reported Monday quoting ILO sources.

The symposium on "Deployment of Workers Overseas: A Shared Responsibility" will be jointly organized by ILO and the Ministry of Expatriates Welfare and Overseas Employment of Bangladesh.

The symposium will discuss recruitment policies and cooperation mechanism between origin and destination countries and provide avenue for exchange of best practices on the preparation of workers for foreign employment and provision of on-site services and monitoring.

Representatives of Bangladesh, India, Indonesia, Malaysia, Nepal, Pakistan, Philippines, the United Arab Emirates, South Korea and Sri Lanka will participate in the symposium.

ILO says counting only those who go through regular channels, more than 200,000 workers are estimated every year from each of Sri Lanka and Pakistan and many more from Bangladesh and India.

In 2007, remittances to the region were estimated by the World Bank to have exceeded 40 billion U.S. dollars.

Of this, India accounted for 27 billion U.S. dollars, Bangladesh 6.4 billion dollars, Pakistan 6.1 billion dollars, Sri Lanka 2.7 billion dollars and Nepal
1.6 billion dollars.

Japan to take in Nepali workers

Japan to take in Nepali workers
eKantipur, 24-May-08
BY PRABHAKAR GHIMIRE

Japanese officials have agreed to accept Nepali semi-skilled and skilled trainee workers for employment with different business enterprises in Japan, said a top Nepali official.

Taking to the Post, Shyam Prasad Mainali, secretary at the Ministry of Labor and Transport Management (MoLTM), said officials of the two countries have signed Minutes of Understanding, specifying priorities in the process of recruiting Nepalis for jobs in Japan.

The minutes were signed in Tokyo by Mainali and the vice president of the Japan International Training and Co-operation Organization (JITCO) - the government entity there for overseeing the training and recruitment of workers.

Mainali said both sides agreed to designate Nepali institutions with authority to send trainees to one of the most lucrative labor destinations, and also to adopt measures to check possible cheating of job seekers during the recruitment process.

Japan is expected to absorb Nepali workers mainly in the industrial and agriculture sectors.

"We are in the process of setting criteria for selecting institutions that can undertake recruitment for Asia's largest economy," Mainali added. Both sides have also agreed to wipe out the possible role of middlemen between employers and designated Nepali institutions to minimize cheating.

"We see Japan becoming a destination for huge numbers of Nepali job aspirants who are skilled or semi skilled but we cannot estimate the exact demand there at this initial stage," said Mainali who also met the Japanese vice-ministers for justice and labor, local employers and JITCO officials.

During the meetings, Japanese officials put forwarded eligibility criteria for Nepali workers in Japan. According to Mainali, workers having knowledge of Japanese language and culture, good work experience and the skills that can be capitalized by the home country in future will be favored while selecting them for jobs.

Under the understanding, the trainee workers will get two years of training and one year of internship at work places in Japan, with handsome pay. He said during their trainee period the workers can earn between Rs 80,000 and Rs100,000 per month as allowance, excluding overtime, depending on the status of the employing companies.

Meanwhile, the officials of both countries also agreed in principle to recruit Nepali workers in Japan through the government level. "We are agreed in principal on a recruitment process through the government level without the involvement of any recruiting agencies," said Mainali, who held talks with the Japanese justice minister in this connection.

He said that the government would complete necessary homework within two months before initiating procedures in consultation with Japanese officials preparatory to sending Nepali workers to this most attractive labor destination.

Nepali workers take great leap outward

Nepali workers take great leap outward
eKantipur, 28-Apr-08

The total number of Nepali workers leaving for overseas jobs rose by 22.65 percent during the first nine months of fiscal year 2007/08 compared to the same period last year.

According to the data compiled by the Department of Labor and Employment Promotion (DoLEP), there were 167,785 departures during the period, up from 136,805 previously.

Qatar was the most popular destination for Nepali fortune seekers with 62,045 of them making their way there. This is a 77 percent rise from the same period last year.

Malaysia, which is number two in the Nepali list of the greatest places to work, witnessed a decline in arrivals of more than one-third during the period under review.

The number of migrant jobseekers departing for the United Arab Emirates (UAE) shot up a whopping 104 percent to reach 32,453 persons during the nine-month period.

Saudi Arabia, the fourth most popular labor destination, took in 27,215 Nepali workers to register a modest rise of 5 percent.

A month-wise breakdown shows that departures decreased during the period mid-March to mid-April to 13,375 individuals from 21,588 during the preceding month.

Officials said the election to the Constituent Assembly was the main reason behind the decline in the number of workers leaving for overseas jobs during the month.

Of the total number of workers going abroad to work, 436 are women. The DoLEP had provided prior approval to 19,181 job aspirants during the month.

Qatar received 5,132 Nepali workers, Malaysia 2,995, the UAE 2,970, Saudi Arabia 886 and Bahrain 489 workers during the month under review.

Afflicted jobseekers registered 47 complaints at the DoLEP against fraudulent individuals and manpower agencies seeking compensation of about Rs 22 million. The agencies paid out Rs 4.8 million in damages at the mediation of the DoLEP.

Nepal, Bahrain to Ink Labour Pact

Nepal, Bahrain to Ink Labour Pact
ArthaExpress, 28-Apr-08

Nepal and Bahrain are set to ink a bilateral labour pact — that will pave way for secured employment opportunities and provide legal recognition to Nepali migrant workers in this Gulf state — on Tuesday.

Bahrain´s labour minister Dr Majeed Bin Muhsin Al Alawi is arriving Kathmandu tomorrow on a three-day long official visit leading a nine-member delegation.

Dr Al Alawi is scheduled to sign a memorandum of understanding (MoU) with his Nepali counterpart Ramesh Lekhak on Tuesday here in Kathmandu, said Uddav Baskota, spokesperson at the ministry of labour and transport management.

According to him, the accord will not only set a legal framework for hundreds of migrant workers but also clearly spells out requirements needed for the job seekers and recruiting agencies in the source country. The employers in Bahrain will then be bound to comply with domestic labour laws and provide facilities as per the laws.

The accord seeks to protect workers´ rights and prevent improper practices by private labour supply agencies which tend to exploit the workers by demanding exaggerated fees, providing false information about their working conditions in host country as well as misleading the employers in Bahrain regarding the workers´ qualifications, experiences and documents.

More than 10,000 Nepalis are currently working in Bahrain as domestic helps. Most of them are unskilled labourers.

Meanwhile, a high-level Nepali delegation is leaving for Tokyo on May first week to take fresh stock of information on possibility to send Nepali migrant workers to Japan and also discuss with high-level government officials to ink a bilateral labour pact.

Labour secretary Shyam Prasad Mainali is leading the Nepali delegation and is scheduled to meet his Japanese counterpart and senior office bearers of the Japan Industrial and Technical Cooperation Organisation (JITCO) during his stay in Japan.

Int’l Job fair to be held from January 12 to 14

Int’l Job fair to be held from January 12 to 14
ArthaExpress.com, 6-Jan08

Here´s a good opportunity for aspirant job seekers. For the first time in Nepal, a three-day long international job extravaganza ´Convergys International Job Fair´ is being organised at Birendra International Convention Centre (BICC), New Baneshwor on January 12-14.

To be jointly organised by the High Level Committee of Information Technology (HLCIT), New Horizons Nepal and Timesjobs.com in association with Convergys, it boasts of offering more than 1000 jobs in reputed multinational companies. As Nepali labour market cannot absorb all unemployed youths, this fair will help reduce unemployment. However, good command over speaking English and +12 pass are the minimum criterion.

According to Sujit Acharya, CEO of New Horizons Nepal the event´s main aim is to create a channel through which international companies can employ the potential human resources from Nepal. "The job-offers at the fair will also help solve unemployment problem," he said adding that Nepal will get more remittance.

"The fair will also help interact multinational companies with local universities and find necessary man-power," said Saroj Devkota, vice-chairman of HLCIT. "These skilled manpower will fetch more remittance," he said adding that they will return as experienced lot.

The major participating companies in the fair include Fortune 500 companies like IBM and Fiserv, EXL Corporation and Convergys. "We support all such efforts to create employment as adverse situation had created more unemployment in Nepal," Manoj Goyal, CEO of Clean Energy Bank that is offering on the spot loan, said.

"Those who return after such exposure would help create more jobs back home," Jan Kerer, senior advisor of GTZ said. Besides GTZ, it has been endorsed by Labour Ministry, NRNs, FNCCI, SDC and Winrock.

Netfox launches remittance services from UK

Netfox launches remittance services from UK
Nepalnews.com, 11-Oct-07

In an endeavour to facilitate the transfer of remittance from UK to Nepal, NETFOX LTD has teamed up with Himalayan Bank Limited (HBL) to provide financial services to Non-Resident Nepalese residing in the UK.

With the recent agreement with HBL, NETFOX is now able to transfer and pay money directly to 200 different locations including all banks and their branches all over Nepal. "NETFOX aims to bridge the gap between Nepali bankers and Nepalese residing in UK by providing account opening services and thereby transferring money instantly to their nominated accounts or cash payments to their beloved ones," said a statement. Besides, NETFOX and HBL are working together to facilitate remittance transfer or other investment opportunities or simply buying personal properties in Nepal, the statement added.

Incorporated under England & Wales companies Act 1985 as a private company, NETFOX LTD is currently providing its services to various importers, INGOS and individuals meeting their various demands for Euro, GBP and US dollars in their designated bank in different parts of the world and cash collection at designated collection points in Nepal in safe, convenient, speedy and economical way, the statement said.

NETFOX has teamed up with selected banks such as Barclays Bank UK, Allied Irish Bank UK, HSBC Bank UK and Himalayan Bank Nepal to serve its customers.

Maid in Malaysia: Door opens for Nepali jobseekers

Maid in Malaysia: Door opens for Nepali jobseekers
eKantipur.com, 10-Oct-07

The Malaysian government is soon allowing its citizens to recruit housemaids from Nepal and three other countries, opening a new avenue for aspiring female overseas jobseekers.

According to news reports, Malaysia is preparing to accept a new group of foreign workers from its existing pool of labor exporting countries in order to ease the shortage of domestic workers.

Malaysian daily the Malaysia Star said that Malaysians would soon be able to hire maids from Nepal, India, Laos and Vietnam because of increasing domestic demand as well as the difficulty in getting domestic helpers from Indonesia, its major source country.

The report quoted Deputy Prime Minister Datuk Seri Najib Tun Razak as saying that the recruitment from the four countries including Nepal would take place once memorandums of understanding were signed with the respective countries.

Talking to the press after chairing the Cabinet Committee on Foreign Workers Wednesday, Najib said the Human Resource Ministry would conduct a study on the country's need for foreign workers while also taking into consideration the problems that came with having more of them.

“Based on the findings of the study, the committee will decide on a policy on foreign worker recruitment,” the report quoted Najib as saying.

“This is good news, but we have not received any official confirmation about it,” said Keshar Bahadur Baniya, director general of the Department of Labor.

Officials at the Ministry of Labor also failed to reconfirm the report. If true, it will enable Nepal to send a substantial number of female workers to Malaysia, they said.

So far, Nepal has sent a meager number of women workers to Malaysia who were absorbed into jobs other than domestic work.

According to the Labor Department's data, a total of 71,074 Nepalis left for jobs in Malaysia during the last fiscal year, making it the most popular destination for Nepali workers.

Reports say that Malaysia currently employs 317,537 foreign maids, most of whom are from Indonesia, the Philippines, Thailand, Sri Lanka and Cambodia.

As of September 30 this year, there were 2,021,099 foreign workers employed in various sectors in Malaysia, including manufacturing, plantation, housework, construction, service industry and agriculture.

Of the total number of overseas workers employed in Malaysia, 57 percent were from Indonesia and 11 percent were from Nepal, according to the official data of the Malaysian government.