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Nepal: Fifth Review Under the Extended Credit Facility Arrangement and Request for Modification of a Performance Criterion-Press Release; Staff Report; and Statement by the Executive Director for Nepal
Author:
International Monetary Fund. Asia and Pacific Dept
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Series:
IMF Staff Country Reports
Volume/Issue:
Volume 2025: Issue 066
Language:
English
Publication Date:
18 Mar 2025
DOI:
https://doi.org/10.5089/9798229004336.002
ISBN:
9798229004336
ISSN:
1934-7685
Pages:
96
Keywords:
staff appraisal; issuance of the Request for Proposals; implementation of the prior action; Nepali authorities; ECF arrangement; Credit; Anti-money laundering and combating the financing of terrorism (AML/CFT); Financial statements; Global
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This paper presents Nepal’s Fifth Review under the Extended Credit Facility Arrangement and Request for Modification of a Performance Criterion. Nepal has made tangible progress in implementing economic reforms under the program, despite a challenging political environment and disruptions caused by the September 2024 floods. The growth recovery is expected to continue in FY2024/25, supported by increased capital spending including on reconstruction, an accommodative monetary policy stance, and additional hydropower generation. Monetary policy should maintain the current cautious, data-driven approach to preserving price and external stability. Executing the planned increase in capital spending and modernizing public investment management are critical to support domestic demand and medium-term growth prospects. Domestic revenue mobilization is needed for development spending and to preserve medium-term fiscal sustainability. To support the most vulnerable, eligibility for the child grant should be expanded. Ongoing efforts to improve the anticorruption framework and enhance anticorruption institutions by amending the corresponding legal acts should continue.
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Cover IMF Staff Country Reports
IMF Staff Country Reports
ISSN:
1934-7685
Publisher:
International Monetary Fund