Helping Nepal Reach Middle-Income Status through SEZs

Locus Founder & CEO Jean-Paul Gauthier with Nepal's SEZ Authority Deputy Managing Director

For the last several decades, Nepal's special economic zone (SEZ) program has intended to promote export-oriented manufacturing to help the country graduate to middle-income status. However, as of 2016, the program had largely failed to overcome Nepal's overall challenges with offering a competitive business environment for manufacturers.

Thus, in 2016, the DfID-supported Economic Policy Incubator (EPI) and Palladium contracted Locus Economica to advise on Nepal's SEZ program. Locus worked closely with the EPI team and the Nepali Parliament's Industry, Commerce, and Consumer Welfare Committee, and carried out the following activities:

  • Analyze the SEZ Act against good international practices and suggest improvements through supplementary regulations
  • Analyze the draft SEZ Rules against good international practices and suggest improvements
  • Assess the status of the Bhairahawa SEZ and provide recommendations for bringing it to operation
  • Review the government's plans for the SEZ program and offer strategic advice on how to achieve the aims of the program.