Nepali economy in sound condition!

Kathmandu, 14 March 09 (Xinhua): Nepali pre-Finance Minister Baburam Bhattarai said all the economic indictors in Nepal were positive despite an economic crisis in the world. local newspaper The Rising Nepal reported on Saturday.
Speaking at a press conference on mid-term evaluation, the minister, however, expressed his concern that the country failed to see an expected economic growth and contain inflation.
The government projected a growth rate of 7.0 percent and an inflation rate of 7.5 percent in the current fiscal year's budget, implemented since mid-July, 2008.
According to the figures complied by the Central Bureau of Statistics during the last six months, economic growth in this fiscal year would stand at 3.8 percent while the inflation this year, according to the central bank Nepal Rastra Bank, would be at 12.5 percent.
Mr. Bhattarai said that the Koshi floods in southeastern Nepal, bird flu, energy crisis, strikes and other obstructions hampered the economic growth.
Mr. Bhattarai said that the government would adopt different measures to control the price hike in the country. The government would go for additional market interference to control the inflation, he said.
He further said that the government would use government's mechanism for supply management and punish those who were involved in black marketing to minimize inflation.
Mr. Bhattarai said that the government had exceeded its revenue targets due to good governance. According to the report, the revenue collection increased by more than 36 percent till mid- February compared to the last fiscal year.
The flow of remittance had increased by 65.3 percent and reached around 94.3 billion Nepali rupees (aroudn 1.2 billion U.S. dollars)in the first six months of the current fiscal year, the report said.
Similarly, the exports increased by 18.6 percent and the reserve of the foreign exchange increased by 5.5 percent amounting to 3.27 billion U.S. dollars. The foreign assistance had increased by 81.3 percent compared to the last fiscal year.
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Economy

Progress
The President signed the American Recovery and Reinvestment Act.
The President announced the "Making Home Affordable" home refinancing plan.
The President launched a $15 billion plan to boost lending to small businesses.
The President and Secretary Geithner announced the details of the Financial Stability Plan.
President Obama played a lead role in G-20 Summit that produced a $1.1 trillion deal to combat the global financial crisis.
The President signed the Fraud Enforcement and Recovery Act which gives the federal government more tools to investigate and prosecute fraud, from lending to the financial system, and creates a bipartisan Financial Crisis Inquiry Commission to investigate the financial practices that brought us to this point.
The President signed the Helping Families Save Their Homes Act, expanding on the Making Home Affordable Program to help millions of Americans avoid preventable foreclosures, providing $2.2 billion to help combat homelessness , and helping to stabilize the housing market for everybody.
The President signed the Credit Card Accountability, Responsibility, and Disclosure (CARD) Act to protect Americans from unfair and deceptive credit card practices.
Guiding Principles

President Obama’s central focus is on stimulating economic recovery and helping America emerge a stronger and more prosperous nation. The current economic crisis is the result of many years of irresponsibility, both in government and in the private sector. As we look toward the future, we must confront the many dimensions of this crisis while laying the foundation for a new era of responsibility and transparency.
Creating Jobs
President Obama’s first priority in confronting the economic crisis is to put Americans back to work. The American Recovery and Reinvestment Plan signed by the President will spur job creation while making long-term investments in health care, education, energy, and infrastructure. Among other objectives, the recovery plan will increase production of alternative energy, modernize and weatherize buildings and homes, expand broadband technology across the country, and computerize the health care system. The recovery plan will save or create about 3.5 million jobs while investing in priorities that create sustainable economic growth for the future.
Keeping Americans in Their Homes
Millions of hard-working, responsible families are at risk of losing their homes as home prices fall and jobs are threatened. The Making Home Affordable Refinancing program will expand access to refinancing for up to 4 to 5 million families who are current on their mortgages but otherwise unable to refinance because their homes have lost value. The Making Home Affordable Modification program has a $75 billion commitment to support loan modifications so that up to 3 to 4 million borrowers at risk of foreclosure can keep their homes. President Obama’s programs to prevent foreclosures will help bolster home prices and will provide direct support to up to 9 million homeowners to refinance for lower payments or have their mortgages modified to prevent foreclosure. President Obama also launched MakingHomeAffordable.gov, where borrowers can learn basic facts about mortgages, homeownership, and resources available.
Bringing Stability to Financial Markets
This crisis has taught us the real impact that financial markets and institutions can have on working families. President Obama has worked to get credit flowing again so that small businesses can rebuild and hire workers and families can afford to send their children to college. At the same time, the President has demanded accountability and transparency both on Wall Street and in Washington, taking steps to ensure that banks use taxpayer assistance to support lending and create sustainable economic growth. For the long term, the President will create a new regulatory framework that holds market players responsible for their actions and stops fraudulent practices before they take hold.

Nepal - The Economy

NEPAL IS ONE OF THE POOREST COUNTRIES in the world and was listed as the eleventh poorest among 121 countries in 1989. Estimates of its per capita income for 1988 ranged from US$158 to US$180. Various factors contributed to the economic underdevelopment--including terrain, lack of resource endowment, landlocked position, lack of institutions for modernization, weak infrastructure, and a lack of policies conducive to development.
Until 1951 Nepal had very little contact with countries other than India, Tibet, and Britain. Movement of goods or people from one part of the country to another usually required passage through India, making Nepal dependent on trade with or via India. The mountains to the north and the lack of economic growth in Tibet (China's Xizang Autonomous Region after 1959) meant very little trade was possible with Nepal's northern neighbor.
Prior to 1951, there were few all-weather roads, and the transportation of goods was difficult. Goods were able to reach Kathmandu by railroad, trucks, and ropeways, but for other parts of the country such facilities remained almost non-existent. This lack of infrastructure made it hard to expand markets and pursue economic growth. Since 1951 Nepal has tried to expand its contacts with other countries and to improve its infrastructure, although the lack of significant progress was still evident in the early 1990s.
The effects of being landlocked and of having to transit goods through India continued to be reflected in the early 1990s. As a result of the lapse of the trade and transit treaties with India in March 1989, Nepal faced shortages of certain consumer goods, raw materials, and other industrial inputs, a situation that led to a decline in industrial production.

Foreign Capital Flows and Growth: Is Europe Different?

Capital, in the last decade, has tended to flow "uphill" from relatively poor, mainly Asian, countries to the United States. The most vivid example is the flow of Chinese savings to finance the U.S. current account deficit. For some, the apparent incongruity of poorer world citizens financing profligate American consumers has ceased to be an anomaly. Indeed, they have come to view this as the norm. The reasoning is that the poorer nations transferring their capital benefit because by doing so they weaken their exchange rates, which, in turn, spurs the development of their exports. The bargain is that lower consumption today will pay back in future riches. A grander purpose served is the stabilization of the international financial system by containing either a free fall of the dollar or the risk of a U.S. and, hence, world recession.
Within Europe, however, the behavior of capital flows is strikingly different. There the flow of capital is "downhill" from rich to poor countries, allowing for the possibility that the emerging nations of Europe can simultaneously increase their consumption and investment. The tighter financial integration within Europe—reflected in more intense cross-border flows within Europe than in any other region of the world—apparently allows for greater diversification of financial risks. Hence, investors and lenders are much more willing to move capital to productive, but possibly more risky opportunities, into the countries of emerging Europe.
As financial integration has increased, the richer nations have tended to run larger current account surpluses (transferring capital) while the poorer countries have run larger deficits (receiving capital). In other words, financial integration leads countries to borrow more from abroad if they are poorer, and rich countries to lend more abroad if they are richer. This process is still ongoing. To take an example, my estimates suggest that, all else equal, an increase in financial integration by 100 percent of GDP would increase Lithuania's current account deficit by 3.5 percent of GDP, and would raise the Netherlands's surplus by 2.1 percent of GDP.
These capital flows have helped growth in the emerging nations of Europe—the poorer the country, the greater the contribution of capital inflows to growth. But as countries become richer, current account deficits (capital inflows) decline (for given levels of international financial integration) as does the growth dividend from foreign capital flows. External finance, therefore, has a self-limiting and transitory influence, though the transition can be drawn out.
This benign process carries at least two risks. First, the "downhill" flow of capital brings risks that are all too familiar from the emerging market crises of the 1990s. Capital flows can be fickle and may reverse at inopportune moments, with costly consequences. Deeper financial integration may imply that investors are better diversified and hence willing to take a longer view, reducing the risk of a "sudden stop" in capital flows. Nevertheless, these risks must be monitored and managed. Second, the gush of capital inflows can hurt if it leads to overvaluation of the exchange rate and a loss of international competitiveness. This possibility depends on whether the inflows are channeled to raising productivity. The evidence so far is that gains in productivity have accompanied in particular foreign direct investment. Other evidence shows that the new member states of the European Union, as substantial recipients of international capital, have also achieved significant transformation of their production structures, raising the technology content and quality of their products. Again, such a favorable outcome is not a given and the risks of exchange rate overvaluation cannot be ruled out.
Does the European experience hold relevance for other regions? Europe's experience may reflect historical and geographical linkages that have facilitated both financial integration and income convergence. Thus it may be that European-style financial integration and its implications apply only for middle-income and advanced economies, with no bearing for a wide range of poorer countries.
There is, however, a more intriguing possibility. The Asian-U.S. pattern of capital flows may reflect a unique response to the crises of the late 1990s. In protecting themselves against a repeat of financial crises, Asian governments have sought to raise their international reserves to unprecedented level, pushing capital "uphill." In a more financially-integrated world, such high levels of protection may not be needed. If so, the patterns we see in a tightly-integrated Europe may well be the leading edge, the bellwether. As global financial integration proceeds apace, it may draw a wider circle of countries within its fold, changing the direction and effects of international capital flows.

THE FINANCIAL ACTION TASK FORCE

Another influential international mechanism has been the Financial Action Task Force or FATF, as it is known in English. FATF was created following the 1989 Paris Summit of the Heads of State or Government of the seven major industiralized nations (Group of Seven or G-7). The Summit concluded that there was "an urgent need for decisive action, both on a national and international basis to counter drug production, consumption and trafficking as well as the laundering of its proceeds." As a result the Summit created the FATF whose mandate was "to assess the results of co-operation already undertaken in order to prevent the utilization of the banking system and financial instiutions for purpose of money laundering, and to consider additional preventative efforts in this field, including the adaption of the legal and regulatory systems so as to enhance multilateral judicial assistance."
Given this mandate the experts duly met and produced a report in 1990. The report has become a landmark in anti-money laundering efforts and the 40 recommendations for action have been hailed by most observers as the single most important prescription for effective controls on money laundering produced The 40 recommendations encompass and enhance the provisions of the 1988 UN Convention and are designed to cover all aspects of money laundering. They cover the criminal justice system and law enforcement, the financial system and its regulation and international co-operation. Moreover, the recommendations are meant to be universal; they are guiding principles that give States the flexibility required by different legal traditions and constitutional arrangements.
As noted, the recommendations were first drawn up in 1990. Following six years of experience they were revised in 1996. The revised recommendations are reproduced at Appendix One. The changes over the six years are not dramatic but they do reflect the real experience of the 26 countries and two international organizations included in FATF membership. Membership carries with it the requirement that implementation of the 40 recommendations is monitored by an annual self assessment and a more detailed mutual-evaluation process which includes an on-site examination by experts from other member States.
THE FINANCIAL ACTION TASK FORCE RECOMMENDATIONS
The recommendations are, as noted above, intended to be comprehensive. They do not rely on the criminal law alone although the first set of recommendations call for strengthening of legislative and enforcement techniques and particularly those designed to take the profit our of crime. In this respect, they reinforce one of the central messages of the 1988 UN Convention.
A. General Framework Of The Recommendations
The first recommendation is the countries should ratify and implement the 1988 UN Convention.
The second recommendation calls on States to frame secrecy laws applying to financial institutions so as not to inhibit the implementation of the FATF program (or the UN Convention).
Third, FATF calls for increased multi-lateral co-operation as noted above.
B. Role Of National Legal Systems In Combating Money Laundering
Scope of the Criminal Offence of Money Laundering
Recommendations 4,5 and 6 call on States to criminalize money laundering and determine which crimes should be designated as predicate offences. The term "predicate offences" refers to the fact that in most countries with money laundering statutes there must be evidence of a previous serious crime before the provisions of money laundering statutes can be applied. That is, if there is, for example, evidence of illicit drug sales, then prosecutors can move to seize and forfeit the proceeds of the predicate crime. Beyond this, recommendation 5 urges that legislation be framed in such a way that knowledge of money laundering can be inferred from objective factual evidence. Thus, those facilitating money laundering schemes, lawyers and accountants, for example could be charged with money laundering if the facts can support the view that they knew or ought to have known that the money was the fruit of crime. They need not, therefore, have been party to the predicate offence. The final recommendation in this section calls on States to invoke the concept of corporate criminal liability so that the corporation and not just employees can be held liable. This is easily accomplished in common law jurisdictions but is more difficult for countries with civil law traditions that have normally not incorporated the idea of corporate criminal liability.
Provisional Measures and Confiscation
Recommendation 7 urges that appropriate legislative measures and procedures be put in place to allow for the ultimate confiscation of proceeds of crime together with "instrumentalities"(that is such things as cars, boats, planes, property) used to commit crimes. The measures, to be effective, must allow authorities to identify, trace and, in the case of valuables which can be moved or otherwise disipated, to freeze, pending determinations by a court.
C. Role Of The Financial System In Combating Money Laundering
Recommendations 8 and 9(Annex to Recommendation 9) address themselves to the variety of financial institutions. Banks, as this group well knows, have competitors. Thus, FATF urges that recommendations 10 to 29 should apply to banks, but also to non-bank financial institutions.
Customer Identification and Record-keeping Rules
There are, of course, a series of recommendations (10 through 13) dealing with identifying customers and keeping adequate records. Anonymous accounts or accounts in obviously fictitious names are frowned upon. Financial institutions are urged to rely on reliable identifying documents. With respect to legal entities, financial institutions are urged to verify the existence and the structure of companies and to verify that persons purporting to act on the company's behalf are so authorized.
Records of customer identity and of transactions should, FATF urges, be kept for five years. These records should be available to domestic competent authorities in carrying out investigations and prosecutions.
Increased Diligence of Financial Institutions
Recommendations 14 through 18 deal with suspicious and unusual transactions. They recommend that such transactions be investigated and that the information be brought to the attention of competent authorities -- supervisors, auditors and law enforcement agencies. If there is suspicion that the funds stem from crime, then there ought to be a requirement to report to supervisors and to law enforcement. Requirements such as these should be balanced by legislation which saves harmless from criminal or civil liability the institution and it's directors, officers and employees when, in good faith, they disclose information ordinarily protected by other legislation or regulation.
Financial institutions are further urged to co-operate with competent authorities by not warning customers and to comply with instructions from the competent authority.
Finally, in this section, financial institutions are urged to develop programs against money laundering that, minimally would see the development of policies and procedures and the involvement of management in the process. On-going employee training programs and audit checks of the system are also recommended.
Measures To Cope With The Problem Of Countries With No Or Insufficient Anti-Money Laundering Measures
The weakest link in the international chain of anti-money laundering measures is the complete non-compliance of several countries whose economies depend on their ability to provide tax havens and bank secrecy. Many such countries make it legal and easy to set up shell companies whose beneficial owners are unknowable. The legal use of nominees as directors of companies and the issuance of bearer shares makes identification of the beneficial owner more than difficult. Given this, recommendations 20 and 21 effectively say, "try your best." They do urge that, in the case of branches or subsidiaries, the same principles applying to the parent institution should apply as well to the subsidiary, where law permits.
Other Measures to Avoid Money Laundering
It was noted above that criminals like banks for the many of the same reasons as law-abiding persons. This does not mean that cash is entirely out of fashion. Many small time criminals use nothing but cash and there are still cash economies and places where banks are not trusted, even by ordinary citizens. There is also much smuggling of cash across borders, frequently so that it can be deposited in banks with less stringent regulations and practices. FATF therefore recommends that countries consider the feasibility of measures to detect cross border transportation of cash and consider as well reporting currency transactions over a threshold amount.
Implementation, And Role Of Regulatory And Other Administrative Authorities
Recommendations 26 through 29 urge regulatory authorities to develop and share information and guidelines on money laundering and to ensure that supervised institutions have adequate policies and programs in effect. Countries are urged to ensure that regulations cover the full range of non-bank financial institutions. Finally, regulators are urged to be vigilante about criminals acquiring significant interests in financial institutions.

TOURIST AREAS

Buenos Aires This capital of 10 million inhabitants is one of the worlds cosmopolitan cities and the center of culture and commerce in the southern cone of America. The city reflects French, Italian and Spanish architecture styles at the turn of the century. Old mansions can be seen next to high rise buildings. Of particular interest are the famous Colon opera house, the Congress palace, the government house, "Casa Rosada"; the "Cabildo" a municipal government house during the colonial period, the Obelisk a symbol of Buenos Aires, as well as the luxurious neoclassic and French Renaissance style of the "Palacio San Martin" and Museo de Arte Decorativo. Other attractions include "San Telmo's" flea market, "La Boca" a brightly painted neighborhood, "La Recoleta" a fashionable area of the city and more than one hundred and fifty art galleries and museums There are in Buenos Aires numerous hotels, restaurants with a wide choice of cuisine, parks, golf courses and soccer stadiums in the heart of the city. Florida pedestrian street, shopping centers, cinemas and cafe-bar are bustling day and night. Buenos Aires is the city were the Tango was born and raised and today shares the excitement of the city night. From Buenos Aires one day trips are possible to the "Tigre" at the Delta of Parana River, a watersport and fishing center. The Falls in the North-East The sub-tropical rain forest in the Province of Misiones offers a chance of seeing the exuberant vegetation, tropical fauna, as well as the striking red coloring of the soil. Nearby the capital of this province the Iguazu river jumps hight from a plateau creating the Iguazú Falls, a semi-circular arch of 275 water falls surrounded by the forest. It is also worth seeing the ruins of the ancient Jesuit missions of San Ignacio that UNESCO included as a part of a Humanity's Cultural Heritage. The colonial flavor of North-West There are two colonial cities Salta and Jujuy, at the foothills of the mountains (Cordillera de los Andes). Both are rich in tradition and history and have cathedrals, churches (San Francisco) and buildings dating from 16th century. Here is still possible to find a mixture of ancient indian traditions and old Spanish influences. Worthwhile seeing are : La Quiaca and Humahuaca, two charming towns nearby Bolivia, the Humauaca Pass with its multicolored rock layers, the beautiful scenery of the Calchaqui Valleys and the Train of the Clouds up in the Andes. Cuyo and the West In vineyards of the fertile valleys of Cuyo (Provinces of San Juan and Mendoza) the best wines of the continent are produced and every year grape harvest festivals take place. Not far from the pleasant city of Mendoza the high mountains of Cordillera de los Andes attract hikers and climbers in the summer and skiers in winter. Las Leñas and Penitentes are among the leading ski resorts in this region. Many peaks, including the Mount Aconcagua the highest mountain in America, can be seen covered by snows all year round. The center and the Pampas Among the Sierras (hills) lays Cordoba, the second city of Argentina that was founded in 1573. From Cordoba to Buenos Aires stretches the symbol of Argentina : the Pampas, a huge plain bare of trees. Grazing fields, horses and cows are part of the scenery in the Estancias that supply beef and grain to the world. Some of them provide high quality accommodation for tourists. Atlantic coast Mar del Plata is the leading seaside resort on the Atlantic ocean approximately 400 km from Buenos Aires. The city itself has the largest casino in Argentina and offers interesting attractions including high seas fishing, sailing regattas, and retail outlets. Another beach resort is Pinamar a small city in a pine forest not far from Mar del Plata. Southern Lake District San Carlos de Bariloche a lakeside city in the heart of the deep blue lakes district is an incomparable vacation spot that attracts lovers of skiing, fishing, hunting, and boating. This region, plenty of high quality hotels and homey inns embraces four National Parks. Skiing is usually possible from the end of June to September in the resorts of San Martin de los Andes (Province of Neuquen) and La Hoya (Province of Chubut). Patagonia and the glaciers of the South The Patagonian long Atlantic coast is home to sea elephants, penguins, sea gulls, sea lions, whales. From Puerto Madryn is easy to reach the Peninsula Valdez reserve and enjoy this maritime extravaganza. But the wildlife is not just confined to the seashore, the Patagonia is also famous for wildcats, pumas, deer, rheas, eagles, and condors. Nestled on the mighty Andes the Perito Moreno is a unique glacier, a river of ice that is continually breaking into freezing water. It is truly one of nature's great spectacles. Ushuaia, the southern most city of the world is an excellent point of departure to explore the channels of Tierra del Fuego and the tip of this continent that faces the silent Antarctic.

Deposit Insurance System

Taiwan's government has decided to provide full deposit insurance coverage regardless of the dollar amount of deposits until December 31, 2010. During the aforesaid period, the content relating to the scope and limit of coverage is not applied to this web page.
What is deposit insurance?
Financial institutions duly approved under the law to accept deposits are required to take part in deposit insurance provided by the Central Deposit Insurance Corporation (CDIC) and to pay premiums therefor. If an insured institution terminates its business or is unable to pay off its deposits, CDIC will compensate depositors up to NT$1.5 million limited to principal. This system is designed to ensure the rights of depositors and maintain the stability of the financial system.
Fact Sheet on Taiwan Deposit Insurance System
Launched
Calculation of Maximum Coverage
(1) How is the per-institution maximum insurance coverage for each depositor calculated?The maximum insured amount for all types of deposits at all branches of the same insured institution is NT$1.5 million per depositor. Coverage does not include interest accruing to such deposits. A depositor can not get additional coverage over the NT$1.5 million limit by dividing his/her savings into separate accounts or branches within the same insured institution. (2) If a person deposits money in two insured institutions and both institutions fail, how is the maximum insurance coverage calculated?The maximum insurance coverage applies to the deposits for each depositor at the same insured institution. If a depositor deposits money at more than one insured institution, deposits at each of the institutions are covered up to the maximum of NT$1.5 million. For example, if the depositor has placed deposits at two insured banks, coverage of up to NT$1.5 million will be provided for each of the deposits at the two banks. (3) If Mr. Smith, his wife and children open separate accounts in their own names at the same insured institution, and that institution fails, how is the maximum coverage amount for all of the family members calculated? The maximum coverage offered by CDIC is based on the deposits of each individual depositor at each insured institution. In the example above, Mr. Smith, his wife and his children are considered as individual depositors and each can obtain the maximum coverage up to NT$1.5 million. (4) How is the maximum coverage calculated on accounts opened jointly in the names of more than one depositor? If a depositor opens a joint account with another person, the amounts entitled to each of the two parties are calculated together with the amount of their own personal accounts and coverage will be provided up to NT$1.5 million for each person.