EIF National Implementation Arrangements in Nepal Lesson Learned and Prospects Chandra Ghimire Joint Secretary and NIU Chief Ministry of Commerce and Supplies

Contents: –Background –EIF Implementation Arrangements in Nepal National Steering Committee: Composition and Roles Focal Point: Roles and Responsibilities National Implementation Unit: Composition and Roles Technical Committees: Composition and Roles Donor Facilitator (DF) and Donor’s Group (DG) –Lesson Learned and Prospects

Global Backdrop IF program is established in 1996 during Singapore WTO Ministerial Conference to accelerate the integration of LDCs into the global economy. That time as an embryonic shape. The HK Ministerial Declaration also includes several issues related to AfT, particularly on IF (Para ).  Enhanced IF (EIF) shall come into force by 31 Dec. 2006, Para 49  Para (50): The Task Force…….. shall provide recommendations on how the implementation of the IF can be improved, to: Provide increased, predictable, and additional funding on a multi- year basis; Strengthen the IF in-country, including through mainstreaming trade into national development plans and poverty reduction strategies; more effective follow-up to diagnostic trade integration studies and implementation of action matrices; and achieving greater and more effective coordination amongst donors and IF stakeholders; Improve the IF decision-making and management structure to ensure an effective and timely delivery of the financial resources.

Background (Contd.) 2007: the IF Working Group (IFWG) and the IF Steering Committee (IFSC) adopted a package of recommendations to implement the Enhanced IF (EIF). A guideline has been prepared for implementation of EIF and as prescribed in it, an institutional set-up (at country level) is needed for implementation of EIF: –At Global Level: EIF Board EIF Secretariat at WTO Geneva, led by the Executive Director United Nations Office for Project Services (UNOPS) as EIF TFM

Background (Contd.) –At National Level: National Steering Committee (NSC) Focal Point (FP) National Implementation Unit (NIU) Donor Facilitator Other committees/task forces/working groups etc., as needed and decided by the respective government.

Nepalese Picture

EIF/NTIS Implementation Arrangement in Nepal NSC National Focal PointTechnical Committees (TCs) Technical Committees (TCs) at their outset 1.Agriculture, agro-industry, NTFP, and SPS 2.Private Sector Development (Manufacturing, SMEs, SEZ/EPZ and TBT) 3.Legislation and Intellectual Property Rights (IPRs) 4.Services and taxation 5.Cross-Cutting Issues and Trade-related Infrastructure Development NIU Donor Facilitator NECTRADE DPs Re-organized in line with the updated DTIS (NTIS 2010)

National Steering Committee (NSC) Composition: Chair- Chief Secretary, Government of Nepal Members  Secretary, Ministry of Commerce and Supplies  Secretary, Ministry of Industry  Secretary, Ministry of Foreign Affairs- Member  Secretary, National Planning Commission  Secretary, Ministry of Finance  Secretary, Ministry of Agriculture & Cooperatives  Secretary, Ministry of Law and Justice  Deputy Governor, Central Bank of Nepal  President, Federation of Nepalese Chambers of Commerce and Industry (FNCCI)  President, Confederation of Nepalese Industries (CNI)  President, Nepal Chambers of Commerce (NCC)  Joint Secretary, PITCD, Ministry of Commerce and Supplies, Member Secretary

NSC: Roles and Responsibilities  This Steering Committee shall carry out all task related to EIF, including the monitoring and following other tasks under the EIF:  Issue necessary policy guidelines for streamlining the foreign trade. Extend support to develop foreign policy as integral component of the national policy.  Extend support for the development of the trade sector by properly mobilizing the domestic and foreign aid received.  Introduce timely improvements in the execution of the GoN’s trade- related policies and programmes.  Perform a coordinating role to establish understanding between governmental, private sector and donor agencies.

NSC: Roles and Responsibilities  Make arrangement for updating the policies and rules in order to fulfill Nepal’s commitment at the time of joining the WTO in time.  Provide advice, suggestions and recommendations to the GoN by reviewing the country’s trade policy from time to time on the subject of enhancing the country’s import management and export trade.  Conduct the technical and financial support received in the trade sector in a coordinated manner. Select projects for foreign aid received in this sector and provide approval.  Act for developing trade-related capacity of the governmental and non-governmental sectors.  Do other tasks related to exports and trade sector development.

Focal Point: Roles and Responsibilities National Focal Point: The MoCS Secretary  Oversees the functioning of the NIU and advises the Government on NIU staffing and operations.  Chairs TAC 1 and TAC 2 and decides, in consultation with the other members, to invite other representatives to participate in these committees.  Works closely with the relevant line Ministries, the Donor Facilitator, the ES, donors and IF Agencies to ensure that trade is mainstreamed into the PRSP, as per DTIS priorities.  Leads on the preparation of the DTIS and its updating.  Reports to the Government and the ES on IF progress.  Provide continuous guidance and coaching to NIU staff (He/She shall appoint a deputy FP, if needed).

Focal Point: Roles and Responsibilities  Advises the Government on NIU staffing and operational issues.  Coordinates NIU expenditures.  Develops linkages with the ES and reports to it quarterly on IF progress.  Works closely with, and maintains, a continuous in-country dialogue with the private sector, civil society, the DF, other donors and IF Agencies.  Formulates the sensitization/communication action plan aimed at enhancing support and involvement of key IF stakeholders, to be implemented by the NIU.  Works closely with the Ministry of Finance, National Planning Commission and other Government agencies to ascertain that DTIS priorities are mainstreamed into the PRSP and other national development plans, such as the Private Sector Development program.  Reports regularly and no less than bi-annually to the NSC and the government authority overseeing the PRSP/national development plans.

National Implementation Unit (NIU) in Nepal NIU Chief (NIU Coordinator) MoCS official assigned to NIU (Number increasing over time) SWAp Focal Points (One from each line ministry) Externally recruited national consultants and support staffs Externally recruited international consultants (Decreasing over time) EIF Programme Manager Trade SWAp Coordinator

NIU Composition MoCS-appointed official: NIU Chief/Coordinator (JS/Head of Planning and International Trade Cooperation Division of MoCS) Trade SWAp Coordinator (Head of Foreign Aid Mobilization Section, MoCS) Private Sector Coordination Officer Inter-ministerial Coordination Officer GoN – TC Liaison officers (depending on number of TCs) SWAp focal points in selected line ministries (depending on number of TCs and recommendations from NSC). The existing WTO focal points could be upgraded to SWAp focal points. Externally recruited (full time positions): A National Programme Manager (NPM) A Programme/Policy Analyst An Administrative and Finance Associate/Assistant (AFA), A Programme and Training Associate/Assistant (PTA).

NIU: Roles and Responsibilities Under the overall supervision of EIF Focal Point, the NIU shall works with the various Ministries and Government’s trade-related institutions, private sector and civil society to ensure coordination at all stages of the IF process. The main duties and function of the NIU shall be:  Works closely with the ES, the Donor Facilitator and IF Agencies for the preparation of the DTIS, the formulation and appraisal of Tier 1 and Tier 2 project proposals and other TRTA actions, as appropriate.  Monitors the implementation of Tier 1 and Tier 2 projects under NSC supervision and reports on progress to the ES. Organizes, as appropriate, IF implementation meetings to assess progress of the IF initiative.  Works with all relevant partners to advocate for, and assist in, the inclusion of a trade integration strategy and its priorities in the PRSP or national development plans.  Prepares its multi-year work plan and a detailed annual operational plan.

NIU: Roles and Responsibilities 2  Raise awareness among Ministries, the private sector and civil society on the relationship between trade, economic growth, and poverty reduction with the aim of ensuring that agreed priorities are integrated into the PRSP/national development plans, relevant line ministry plans and the national budget.  Facilitate intra-governmental and donor coordination, as well as public-private sector dialogue on trade development, using proper consultation processes such as the PRSP, other national development plans and private sector development programmes.  Advise on sectoral and cross-sectoral trade issues, including the regional trade dimension, involving meaningfully the IF line Ministries.  Identify the preparation of diagnostic work to be carried out in partnership with other Ministries. This can range from full-fledged DTIS or DTIS updates to more narrowly specified analytical work that is required as a follow-up to the DTIS or to assist project identification/preparation.

NIU: Roles and Responsibilities  Work with implementing partners to turn priorities in the action Matrix into "bankable projects", including Tier 2 projects and projects for the financial consideration of bilateral and multilateral donors. Implementing partners is broadly understood to mean Ministries, other Government entities, the private sector, civil society, NGOs and other development partners.  Maintain and promote the dialogue between the national authorities and bilateral and multilateral development partners with a view to achieving a coordinated and comprehensive support to the implementation of the country's trade integration strategy, and its inclusion into the country's national development strategy (PRSP).  Recommend to the NSC, through the Focal Point, prioritized areas for IF actions and elaborate strategies of intervention.  Implement the national IF sensitization/communication activities aimed at enhancing support and involvement by local stakeholders.

NIU: Roles and Responsibilities  Monitor the implementation of the overall trade integration strategy, including the implementation of programmes supported by the IF Trust Fund, in close collaboration with key government agencies as well as development partners. This would include the integration of an IF monitoring and evaluation system into existing systems for monitoring development programmes.  Report on progress of IF implementation at relevant government coordination meetings (e.g., PRSP, national development plans, Private Sector Development Programme, etc.) where they exist. Where these do not exist, organize quarterly meetings.  Report on IF implementation progress to the FP, NSC and to the ES.  Prepare an inventory of all ongoing and planned TRTA projects in the country, if existing capacities allow for it.  Organize IF implementation meetings, in consultation with local stakeholders including donors, to assess IF progress at the country level.  Coordinate mid-term reviews and evaluations of the IF at the request of the IF Board and IFSC.

Technical Committees (TCs) TC-1 Lead by Ministry of Commerce and Supplies All the NTIS Actions related to ; Trade Capacity Development, Service Sectors (including 7 Value Chains), Trade Support Institution, Aid for Trade, Cross-Cutting Issues TC-2 Lead by Ministry of Agriculture and Cooperatives All the NTIS Actions related to ; Agriculture Value Chains (including 7 NTIS agro-products) and SPS TC-3 Lead by Ministry of Industry All the NTIS Actions related to ; Industry (including 5 crafts and industrial goods), Investment, TBT and IPRs

Cont… TC-4 Lead by Ministry of Finance All the NTIS Actions related to ; Customs and Trade Facilitation TC-5 Lead by Ministry of Law and Justice All the NTIS Actions related to ; Legal Reforms

TCs: Roles and Responsibilities In close cooperation with the EIF Focal Point and NIU, the TCs will be responsible:  To assess needs (infrastructure, legal and institutional, capacity building plans etc.) in their specific area,  To prepare a Trade Related Technical Assistance (TRTA) Plan and develop proposals for technical assistance and submit it to the National Steering Committee (NSC) for its approval,  Review rules/regulation in compliance with World Trade Organization (WTO) regime and examine/assess the commitments made by Nepal during the accession to WTO and report to the NSC,  Creating a WTO cell in the institution and assign a Joint Secretary as the Focal Person.  In order to carry out its activities, the TCs reserves right to create technical subcommittee(s), as and when required. In addition, consultant(s) can be hired to assist TCs and its sub-committees to conduct their activities.

DF: Roles and Responsibilities  The main objective of the DF is to help mainstream trade into donor programming to ensure timely implementation of the Action Matrix. The precise task of the DF will be based on a work program to be elaborated in cooperation with the LDC Government. The necessary functions of the DF are:  Assists the Government to enlist and coordinate donor responses to the Action Matrix produced, including liaison with donors to ensure effectiveness, complementarities and harmonization of interventions, including exploring the possibilities for pool funding arrangements for implementation of action matrix priorities.  Follows up on the Action Matrix, especially on donors' responses, to promote maximum coordination among donors.  Supports the NIU and the FP in the conduct of their responsibilities as per the established TORs.  Assists the NIU to formulate and appraise Tier 1 projects and participates in their approval process.

DF: Roles and Responsibilities  Assists the NIU to formulate and appraise Tier 2 projects.  Facilitates the Government's contacts with the donors by functioning as a link between the donors and the Government (when the Government and donors so desire). This entails ensuring that all relevant pieces of information regarding the IF and its implementation are adequately transmitted to IF stakeholders, including from the donors to the Government and from the Government to the donors. It also entails close coordination with, and being sensitive towards, the wishes of the National Implementation Unit and the National Focal Point.  Provides regular briefing updates to donors on IF progress and arranges for consultation and coordination possibilities for the donors present in the country.

DF: Roles and Responsibilities  Informs stakeholders, including the donors, on the progress and results of IF implementation.  Assists the local authorities in creating knowledge and understanding of the IF process in the country, especially at the higher political level.  Additional functions that the DF could undertake  Supports the Government in efficiently steering the IF process, possibly including the assessment of the institutional needs required and the establishment of the IF FP, NIU and NSC.  Advises, as appropriate, on the establishment/strengthening of inter-ministerial consultation mechanisms.  Supports the National Implementation Unit and its Focal Point in the conduct of its responsibilities as per the established TORs.

Lesson Learned and Prospects  Trade mainstreaming is the key up to sectoral level – as Government commitment for trade sector development  Active involvement of all the stakeholders (GOs and non-Gos) needed (e.g. mobilization of TCs in project preparation and resource mobilization)  Involve private sector as much as possible  Continue dialogue with the Development Partners  Mix-composition of NIU staffing with dedicated ToRs and develop capacities to perform their duties and responsibilities  Develop tools to communicate and monitoring the progress

Lesson Learned and Prospects Trade mainstreaming in the DPs' country assistance strategies Donor mobilization especially in 'hardware' related activities Setting up a full-fledged TTF in the Nepalese context Retention of high level political commitment for trade & development LDCs' solidarity with respect to South-South cooperation as part of learning from each others.

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