To Davos with hammer and sickle

Prime Minister K P Oli is flying off to Davos to attend the World Economic Forum on 20 January with a 18-member delegation. This is the first time a Nepali leader has been invited, and it is interesting that a communist is going to a capitalist conclave of free marketeers.

Unlike some others party heads from China or Vietnam who have attended Davos, Nepal’s prime minister is the first democratically-elected Communist leader to do so. According to PM Oli’s foreign policy adviser Rajan Bhattarai, the invitation to attend is a recognition of Nepal’s achievement in ending the conflict, holding elections under a new constitution, and its commitment to lifting living standards through stability. 

The Prime Minister will be speaking at two panels, one on South Asian security and another titled ‘Beyond GDP’, where he is expected to promote Nepal in the global arena as a politically stable nation with a favourable environment for international investment. He will meet the Swiss and Vietnamese presidents, and attend a private dinner hosted by the World Economic Forum Executive Chair Klaus Schwab.

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However, experts say Nepal’s leader will be judged more by what he does than what he says. Nearly a year after becoming prime minister, Oli gets generally failing grades on transparency, accountability and investment climate.

Former diplomat and UN official Gyanendra Acharya says that networking with international businesses and leaders in Davos will in fact be more important than performances at panels. 

As Nepal tries to take the great leap forward to middle income status in the next decade, Foreign Direct Investments (FDI) will be necessary to create employment opportunities, develop infrastructure and to propel sustainable growth. But the inflow of FDI has been minimal in the past five years, and FDI makes up only 1% of the GDP.

Says Nepal’s former ambassador to the United States Shankar Sharma: “Even if the prime minister just succeeds in conveying the message that Nepal’s economic environment is optimum for foreign investments, that alone will be an accomplishment.” 

Economics Jayajung Mahat adds that Oli being in Davos could be an important stepping stone to establish global political and economic partnerships, even if it may not have any immediate tangible impact.

The Davos conference used to be a platform to advocate for liberal policies and private sector development, but recently has also included issues of social justice, inclusion and sustainable development. 

Nepal’s newfound stability, improvement in electricity supply, the availability of cheap labour, and location next to the world’s two largest markets could be plus points for investors looking for under-exploited markets.