Good Political Culture

Op-ed piece originally appeared in The Kathmandu Post on March 29, 2017. Read original article here.

Jayung-Mahat-29032017084326-1000x0
Artwork Courtesy: The Kathmandu Post

Political parties’ failure to adjust their ideologies, principles and actions could put the country at risk

These days, people are constantly questioning the performance of Nepal’s political parties—be it in terms of maintaining internal cohesion or having enough collaborative efforts with other parties to work towards common national interests. While common Nepalis exhibit this trend in relation to the overall performance of Nepali political parties, cadres affiliated with different parties tend to defend their positions and make quick comments against other parties and their policies.

Need to evolve

I have interacted with some of Nepal’s leading politicians from both old and new parties, and only a handful of them have both impressed and instilled faith in me through their work and vision. While I don’t believe that our current politicians are totally abysmal, I believe that those with sound vision for the country are obscured and divided by individual and political ideologies.

Nepal’s major political parties have undergone numerous divisions and reunions, resulting in the constant creation and absorption of different factions, and providing an often ignored explanation for the country’s dire political conditions. Moreover, we can see how the intensifying frustration of common Nepalis towards the failure of old parties resulted in the rise of new political parties in the post-2006 period. If this trend continues, I do not see the formation of a better political system in Nepal. In the absence of a stable political system, I also cannot expect Nepal to establish balanced diplomatic ties with our immediate neighbours and with other nations across the globe.

My experience in over two dozen countries has led me to believe that, in conjunction with guiding political ideologies, all parties should also incorporate three key principles—political compromise, constructive criticism and innovative protests—into their political agenda to better organise themselves and meet citizens’ expectations. These principles are missing from the ideologies and actions of Nepal’s political parties.

Key principles

Forming a new political group is not a novel practice in a democratic country like Nepal. That’s why Nepal has countless political parties, of which over two dozens have at least one member in Parliament. If the figures are analysed according to the existing number of districts and zones in Nepal, about two registered parties can be allocated to each district and two parties represented in Parliament can be allocated to each zone. I have found no evidence of countries and communities flourishing as a result of having a large numbers of parties. Personally, I think this practice overcrowds the political scene and harms parties by creating confusion and division among voters. Political compromise among leaders and cadres of parties with similar ideologies and agenda could help avoid electoral losses. By coming to a compromise, individual parties would be able to prevent potential electoral losses and strengthen their collective voice to advocate common agendas.

Identifying problems in individuals or in political institutions is easy, but the real challenge lies in developing an intervention strategy that can make leaders and parties realise mistakes and correct them. I believe that if individuals enter into politics with the assumption that all others in the system are corrupt and non-functioning, these new entrants will neither give positive work due praise nor accept constructive criticism; they would only promote practices of blame game. During my travels to Switzerland and Japan, I witnessed the respectful way local politicians talk about their opposition and the overall impact this practice has on politics at local, national and global levels. I believe that parties in Nepal could employ these principles of respect in political activities, thus building a harmonious relationship with other parties and with the public.

With a large number of political parties in a country, the chances of disagreements are higher. This could result in frequent protests. This has been the case in Nepal. Though the ways of staging protests are changing over time, the current practice of disrupting public life by closing roads and markets, vandalising vehicles or burning tyres still persists in Nepal. Instead of inflicting damage, parties in Nepal should learn to use innovative and non-violent ways to express their dissimilarities; they should not compromise the country’s basic service sectors like education, healthcare, industries and airports. If used properly, effective protest techniques could help parties rally against disagreeable policies and actions presented by their opposition. They could also win public support through the same efforts, and build and maintain a good political culture in the country.

Nepal has seen a substantial growth of political parties in the last decade. Those that fail to recognise the citizens’ demands of time and dignity, and fail to accordingly adjust their ideologies, principles and actions could put the country’s future at great risk.

BRIDGING THE GAP – Emerging Technology Increase People’s Access To Finance

Article originally published in February 2017 issue of Business360°, one of Nepal’s premier business magazines, under the monthly column – Innovation Insight. Read original article here.

bridging-the-gap-770x433

January 2017 remained a very important month for smartphone users in Nepal, mainly for two big reasons. First, the iPhone was celebrating its tenth anniversary and the second, Nepal Telecom (NT) was launchingLTE-based 4G services for its postpaid GSM users in Kathmandu and Pokhara effective from day one of this year.

When late Apple co-founder Steve Jobs first unveiled iPhone to the public at Macworld Convention on January 9, 2007; most of the senior Silicon Valley entrepreneurs, including former Microsoft CEO Steve Ballmer, suspected that it would have substantial impact on people’s lives.However, in just one decade iPhone has revolutionised the way people live globally. It transformed a traditional communication device into a real “smart-phone”with sophisticated user interface, easy connectivity, rich app store and took the concept of mobile computing to next level with unlimited potential. Enhanced security features, user-targeted and user developed multimedia rich content and alternative ways of doing things that were traditionally less effective changed people’s way of thinking and acting. These developments have changed the way we communicate online thus affecting most aspects of our lives. In 2016, of an estimated 4.61 billion mobile phone users globally, about 2.1 billion users were thought to have been using smartphones and the latter trend is peaking significantly, especially in emerging economies like Nepal.

While there were less than 50 internet users in Nepal in 1995, the year 2016 saw that number increased to over 30 million according to the mid-September 2016 Management Information System report by Nepal Telecommunication Authority with country’s mobile phone and Internet penetration rates now standing at 116.59 % and 54% respectively. Though mobile phone ownership rate in urban areas is higher by about 15 % than in rural areas, the latter parts of the country are expected to see considerable growth in the near future with improved network coverage and expansion of service facilities. With the recently introduced fourth-generation wireless facilities, eligible NT users now can browse Internet at a peak data rate of 32.4 mbps and if used properly it can help them to significantly enhance their personal and professional development. As NT plans to qualify its prepaid subscribers to use 4G networks towards the second half of the year, the anticipated overall positive impact of mobile computing on lives of Nepalis are quite exciting and most of these would take place in rural Nepal where more than 80% people live.

Globally, mobile computing has been helping emerging economies to minimise the digital divide and facilitate a variety of public and private services in money and banking, education, health, transportation, agriculture, tourism and governance sectors in rural and urban areas alike. However, in the context of Nepal, I see huge potential of leveraging emerging technology in order to increase people’s access to finance, especially in the rural parts of the country, given geographical distribution of the country’s population, their current and potential smartphones subscription patterns and projections, annual incomes, literacy rate and underlying difficulties and high transaction costs for opening branches of banks and financial institutions (BFIs) in these regions.

Finance is at the center of the development process. A 2008 World Bank study has outlined that access to finance with an inclusive, efficient and well-functioning financial system leads to steady economic growth through improvement in opportunities and balanced income distribution and poverty reduction. Access to finance, in simple terms, is the ability of individuals or enterprises to receive financial services, including credit, deposit, payment, insurance and other risk management services. Indicators of whether individuals have bank accounts, use banks as their primary financial institutions and can reach financial institutions by foot are used to measure the extent of access.

According to Nepal Rastra Bank, 61 % Nepali adults have access to formal financial services. In recent years, there has been a surge in the network of banks and financial institutions in the country. However, 18 % adults still do not have access to financial services. As of mid-June 2016, there were 4,219 branches of 182 BFIs in the country and population per branch of financial institution stood at 6,647 national average. In some parts of rural Nepal, this figure remained at 72,026. I see a potential injection of mobile computing in order to minimise the existing inequality among ‘banked’, ‘under banked’ and ‘unbanked’ Nepalis at reasonable costs.

Since the last decade there have been many discourses about and experiments on mobile phone’s potential impact on the financial industry. According to the Global Mobile Systems Association (GMSA), in 2015, people in 93 countries made 33 million daily transactions through 271 mobile money service providers. With these developments, mobile money has been changing the overall financial landscape – in 2015, 37 mobile money markets had ten times more registered agents than bank branches and the total number of registered customer accounts increased by 31 percent and reached 411 million globally. Sub-Saharan Africa still dominates mobile money market with Kenya leading the way in harnessing mobile phone technology in financial services. For example, M-Pesa was the first mobile money transfer service in Kenya. Run by Safaricom, a Kenyan mobile-phone operator, M-Pesa was launched in 2007 for basic money transfer and financial services and has now transformed overall economic interaction of the Kenyans. In 2013, this platform witnessed 237 million P2P transactions amounting 43 percent of the country’s GDP. Currently, M-Pesa has became an integral part of the local daily lives as it allows people to accomplish an array of banking services including money deposit and withdrawal, remittance transfer, utility bills payment and microcredit provisions.In less than a decade, it has extended financial inclusion for an additional 20 million Kenyans and helped to create thousands of other small enterprises. Between 2008 and 2011, Kenyan mobile money services users living under $1.25 increased from 20 percent to 72 percent. After promising accomplishments in Kenya, M-Pesa later expanded its services to nine additional countries in South Asia, Africa and Eastern Europe. In addition to M-Pesa, FNB Connect and WIZZIT in South Africa, GTEasy Savers in Nigeria, Smart Money and GCASH in the Philippines, bKash in Bangladesh and EasyPaisa in Pakistan are some of the other successful mobile money service providers.

With the unprecedented innovations in mobile phones and related technologies in the recent decade, globally, more people now own real smartphones and these new devices are getting cheaper with the Internet too becoming easily accessible at lower cost. A 2014 study by GMSA has anticipated that smartphone features would allow every mobile money service provider to ameliorate the quality of its services through introduction of suitable apps, improved user interfaces, and enhanced functionalities. These features would also potentially ease adoption and usage by giving more intuitive customer experiences. Thus, the overall impact of mobile money services on people’s lives is certain to become even more evident in the future.

These successful experiences from different countries in Sub-Saharan Africa, East Asia and South Asia accompanied by available futuristic smartphones in the Nepali market that also can exploit NT’s 4G services, provide sufficient room for the country’s public and private mobile phone operators to work on utilising technologies to break the barrier among ‘banked’, ‘under banked’ and ‘unbanked’.

The Singapore model

What Nepal can learn from the city-state’s success in nation-building

Jaya Jung Mahat and Prem Upadhayaya

long-road-to-justice-10012017081044-1000x0
Artwork courtesy: The Kathmandu Post

Jan 10, 2017- Foreign and Nepali politicians often refer to Singapore as one of the model nations when it comes to planning for a ‘new Nepal’, even though our own country is almost five times older than Singapore. But Singapore has come a long way since its independence in 1965. Pragmatic policies, commitment, accountability and tireless efforts by Lee Kuan Yew, the founding father of Singapore, have contributed to this development miracle. There are key strategies that helped Singapore remain strong on the world map and lessons that Nepal could learn from.

A top performer

An island with an area of 720square kilometres, Singapore is home to about 5.5 million residents. Roughly 74 percent of the population is Chinese, 13 percent Malays, 9 percent Indians, and 3 percent are of other origins. It has a GDP per capita of 69,283 Singapore Dollars ($55,182)—almost 70 times higher than Nepal’s, and it maintains top positions in other international rankings.

Singapore has been thriving in an unprecedented way through locally contextualised politics. It has no natural resources, but Lee Kuan Yew understood that ‘people are everything’. He invested in them and believed in meritocracy to deliver development.

The dominance of Chinese Singaporeans is often considered one of the major factors that led to the separation of Singapore from Malaysia. Thus, in the post-independence era, the country adopted inclusive social policies that would help harmonise relations between citizens from different ethnicities. Hard work and self-reliance were extremely valued. Lee believed that all are born equal. He made huge investments in, and ensured equal opportunities to, all citizens in education, healthcare, employment, and social unity. Through a ‘many helping hands’ approach and ‘self-help’ community initiatives, the country could ensure participation of each individual, and meritocracy has remained the leading principle of every sector in the country.

Becoming a major player

Singapore started to move away from import-substitution by attracting multinationals during the mid-1960s, when only a few other countries had practised such strategies. Also, substantial investments for developing competent human capital, creation of industrial clusters and reforms of labour laws and fiscal and monetary policies helped Singapore achieve a competitive advantage. During this period, the country managed to maintain a 10 percent annual growth rate on average. Later Singapore revised its economic policies and liberalised key service sectors like finance, business and telecommunications to remain competitive. Such a ‘learning by doing’ reform approach helped Singapore graduate from the third world to the first world in a single generation.

Singapore has also proven that small states can be major players in world politics. Trade networks, inter-regional groups and engagement are some of the diplomatic tools Singapore has been pursuing to boost its global standing. It has broken out of the ‘small-state mentality’ to think beyond borders. With limited land space at home, it believes in building industrial parks abroad. Its diplomatic dealings are fair, neutral, and mutually beneficial to all involved. It is the domestic strength and international trust that Singapore earned since its independence.

Both Singapore and Nepal are multi-racial, multi-cultural, and multi-lingual countries. Singapore has been practicing a dynamic social policy to strengthen national identity by protecting interests of all groups, and developing a common space to enjoy social life. Everyone is treated fairly without any discrimination. The minor-

ity’s representation in the political process is ensured through Group Representation Constituencies (GRCs). Every public housing estate has an equal share of different ethnic groups to foster harmonious relations. These insights will be instrumental for Nepal to realise federalism.

Breaking the inferiority complex

Like Singapore, Nepal too is surrounded by giant economies. If we could develop suitable and balanced economic policies and strategies, our industries could have direct access to the Indo-Chinese market of over 2.5 billion people. To achieve this, we need to focus on a high-end-value and export-oriented economic model rather than on an import-substitution one.

Breaking an ‘inferiority complex mentality’ in pursuing foreign policy goals must be at the forefront of Nepal’s external dealings. Singapore succeeded in positioning itself as a crucial player in the world economy. Nepal must also participate in trade networks and inter-regional groups, and engage actively in geopolitics in order to boost its standing with other economies.

Singapore has proven that the size and the population of a nation do not necessarily determine a country’s prosperity; its social, economic, and foreign policies and strategies do. There are two things that Nepal must learn from the Singapore model. First, we must gain internal strength through economic prosperity and social harmony. Second, external dealings must focus on national interests rather than on partisan interests. Despite being a landlocked country, these two nation-building principles could help Nepal survive and escape the vicious cycle of underdevelopment.

Read it online

GDP Per capita – Cuba Vs SAARC countries (1990 – 2014)

gdp-per-capita-worldbank-1
Graph Courtesy: Our World In Data

In 1990 Cuba’s GDP per capital value was higher by almost four times than that of SAARC’s most prosperous nation then – Sri Lanka. With an exception of Maldives & Afghanistan (for which data were missing), the performance of remaining five South Asian countries was even worse.

Twenty-four years later, Cuba’s GDP per capita exceeded $19,000 despite US Government’s extended economic sanctions. Among South Asian economies, Maldives had the highest GDP per capita value of $11953.59 and Afghanistan had the lowest value of $1844.02 in 2014 respectively.

During the same period, Nepal went through a decade long devastating Maoist insurgency (1996 – 2006). Moreover, the country also witnessed the fall of the Monarchy and two elections to the Constituent Assembly. During the same period, politically, Nepal remained one of the most unstable countries in the world. Between 1990 and 2016, the country saw twenty-five Prime Ministers, each occupying his office for average of about ten months only. All these factors explain why Nepal was the worst performer in terms of GDP per capita in 1990 and now remains the second worst performer among the SAARC member countries.

Links for 22/11/16

Links for 15/11/16

Links for 09/11/16

Interesting linkages between natural calamities, labor migration & remittances

According to World Bank’s recent Migration and Development Brief, remittances to labor-sending developing countries rise in the aftermath of a disaster. Moreover, those countries witness gradual increase in remittances in following years if extreme disasters, climatic & geological, affect more than 10% of the population – All developing nations saw rise in remittances by about 2% of average GDP in the first year following an extreme disaster and by approximately 5% by the third year.

14224815_336143173388923_4423095288722603944_nNepal saw 3 major floods and 2 major earthquakes during 2008 – 2015 period. Interestingly, the country saw increase in labor migration and remittances after flood events but increase in remittances and substantial decrease in labor migration in post-earthquake situations.