## Nepal: Staff Report for the 2012 Article IV Consultation

_IMF Staff Country Reports, December 6, 2012_

## Source details

**Canonical URL:** [Nepal: Staff Report for the 2012 Article IV Consultation](https://www.imf.org/en/publications/cr/issues/2016/12/31/nepal-staff-report-for-the-2012-article-iv-consultation-40149)

## Other formats

- [Markdown version](/en/publications/cr/issues/2016/12/31/nepal-staff-report-for-the-2012-article-iv-consultation-40149/index.md)
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## Bibliographic details
- Published: December 6, 2012
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781475555479.002

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### Political context and implications for macroeconomic management
- Nepal is described as a "post-conflict state seeking to formalize democracy in a challenging environment."
- Significant headway toward a new state has been made since the 2006 peace accord.
- The constituent assembly failed to meet an end-May 2012 deadline to ratify a new constitution, representing "a serious setback, and a major impediment to macroeconomic management and prospects for growth."
- The constituent assembly was dismissed in June 2012, leaving day-to-day operations in the hands of a caretaker government.
- New elections are notionally slated for April 2013, but will require fractured political parties to agree on an interim consensus government.
- The lack of a consensus government and functioning parliament is associated with:
  - Delays to key articles of legislation (such as the government budget).
  - Dampened investment (foreign and domestic).
  - Reduced potential donor support.
  - Undermined prospects for sensitive financial sector and state enterprise reforms.

### Technical progress and policy areas
- Progress has been achieved on a range of technical issues, including:
  - Public financial management.
  - Monetary policy.
  - Financial sector supervision.

### Risks to growth and financial-sector reforms
- Political impasse and caretaker governance are identified as principal constraints on:
  - Macroeconomic management.
  - Prospects for growth.
  - Implementation of financial sector and state enterprise reforms.
- The political situation is explicitly linked to lower investment and constrained donor engagement.

### Subject coverage and keywords (from the report)
- Subject: Balance of payments, Banking, Commercial banks, Economic sectors, External debt, Financial institutions, Financial sector, Public debt, Remittances
- Keywords include: authority, balance sheet, banking sector problem, broad money, Commercial banks, CR, debt, deficit, exchange rate, Financial sector, Global, inflation front, interest rate, ISCR, monetary management, Nepalese authorities, Remittances

*International Monetary Fund. "Nepal: Staff Report for the 2012 Article IV Consultation", IMF Staff Country Reports 2012, 326 (2012).*

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## Content in this bundle

- **Nepal: 2012 Article IV Consultation; IMF Country Report 12/326; November 2, 2012**
  - [Nepal: 2012 Article IV Consultation; IMF Country Report 12/326; November 2, 2012 (Markdown version)](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2012/_cr12326.pdf.md){rel="alternate" type="text/markdown"}
  - [Nepal: 2012 Article IV Consultation; IMF Country Report 12/326; November 2, 2012 (PDF)](/-/media/websites/imf/imported-full-text-pdf/external/pubs/ft/scr/2012/_cr12326.pdf){rel="external" type="application/pdf"}

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_Source: https://www.imf.org/en/publications/cr/issues/2016/12/31/nepal-staff-report-for-the-2012-article-iv-consultation-40149_