Dr Thomas Prinz, Ambassador of the Federal Republic of Germany to Nepal for over a year, talked to Editor-In-Chief Madan Lamsal of the New Business Age on wide range of issues including Nepal-Germany relationships, getting access for Nepali products to Germany, and German financial assistance to Nepal’s development. Here are excerpts:

How do you assess the current status of Nepal Germany relationships?
The relations between the two countries are good. We have absolutely no issues whatsoever. In addition, the German government has decided to prolong the development cooperation for Nepal. This is a good sign for our bilateral ties. We readily helped Nepal during the COVID and we are providing 1.5 million doses of COVID specialized vaccines against Omicron variant which will arrive soon. We are standing by the side of Nepal. In addition Nepal is a good partner in international crises such as Ukraine and Iran.

Germany has been active and kind to provide assistance to Nepal in various fields, and one such prominent area is for cultural preservation. How satisfied is Germany with the achievements made in the field so far?
We are extremely satisfied with efforts made for cultural conservation. We take every visitor coming from Germany to Bhaktapur and show them around. Bhaktapur had many problems back in 1970s such as lack of hygiene and canalization. But, these problems were solved in collaboration with German engineers and now it’s one of the most beautiful cities in the world. We take pride that we took part in making the city beautiful. Bhakatapur is just one example. We have the conservation projects in other parts such as Upper Mustang. We try to help Nepal preserve its wonderful culture and fantastic architecture. We are happy with this cooperation and will continue our help for conservation efforts in Nepal.

Germany was one of the major donor countries to provide help to Nepal in its reconstruction campaign following the deadly earthquake of 2015. How do you evaluate the use of the fund allocated for the reconstruction work?
Recently I have been to Ramechhap with German parliamentary secretary. There, we opened a District Hospital. This is the hospital serves the people from the whole district. This is one of of several success stories of how Germany has helped Nepal to overcome damages done by the 2015 tremor.

Nepal and Germany had signed an investment agreement back in 1986. How effective has it been in your experience?
I think the agreement is a basis for bilateral investment. But, it does not necessarily lead to huge amount of business. I think we can do more by bringing German businesses to Nepal and taking Nepali businessmen to fairs in Germany. What we need is civil society contact that was hampered by COVID-19.  In 2019, we had German Nepal Business Council and right now we are working to organize Nepal German Business Council again next year in order to bring in interested investors to Nepal and match them with their counterparts here. In addition, many companies are bringing in German consumer goods and products. The number of middle class people is growing in Nepal and they want to consume what people of their class consume elsewhere. There is a lot of interest for German goods and products in Nepal and that is first step for future investment.

Germany used to organize Drupa fair. Nepali entrepreneurs used to visit Germany to participate in the fair until the COVID crisis. Are you going to restart the fair?
I know from our visa department that many Nepali entrepreneurs are showing interest for the trade fairs in Germany. And we are starting the fair very soon.

Foreign Direct Investment (FDI) flow from Germany to Nepal seems to have slowed down in recent years. In 2017/18, Nepal received 51 million US Dollar from Germany. In 2018/19, the FDI coming to Nepal was just 65 million and nothing came after that. Does it indicate that we need to revisit the 1986 agreement?  
I don’t think so. It also depends on products Nepal is providing. In the last few decades, Nepal was exporting carpets to Germany. Of late, this has slowed down. I think Nepal has to diversify its products as many countries are coming out with products of many style and fashion in the market. Nepal cannot rely on carpets and pashminas only. That is why we are supporting various products such as organic tea, coffee and herbal products to enter the European market.

Is it true that Nepali products such as carpets and pashminas have lost their market in Germany for failing to meet the quality and requirements of German consumers?
I don’t think so. Nepali pashminas are wonderful and your carpets are fantastic.

If so, where is problem? And what is lacking?
There is no single reason.  There are many competitors coming up with their products. And market somehow saturated. We should look for new opportunities with different products. That is why, as a government, we support certain industries such as pharmaceutical association in Nepal. We advise and guide them on how to meet necessary requirements and standards to export their products to international market such as the United States and Europe. Recently, I visited some pharmaceutical producers in Nepal and they have got top products facilities with highest standards. This is how we want to help Nepali businesses to jump over the border and export their products to international market.

How do you think Nepali entrepreneurs and businessmen can export their products to European market such as Germany?
I think they have to show their products to the world, take part in fairs. And most importantly, go with market flow and be innovative. For instance, travel industry is dynamic and changing. You have to figure out new travel destinations. Khumbu and Annapurna are well known destinations, but other regions need further development. Nepal has to be flexible to offer new destinations and come up with new ideas. One example: For female tourists, you need female tourist guides. We had a GIZ delegation which did make a study on travel market in Nepal. The delegation helped local agencies on how to explore new destinations and provide new offers to the visitors. Female tour guides are one of the recommendations.

Germany is the third largest market for Nepal’s export. But, the figures of Nepal’s export to the Germany seem to be stagnant. Are there any other items and products being explored by the German Chamber together with Nepali counterpart for export to Germany?
There are chances in high end agricultural organic products such as tea, coffee, honey, herbs. They are not traditional but high end niche products. Coffees, tea made in Nepal are world class. Consumers want fine quality, pesticide-free products. They are willing to pay little bit more for organic product. Pharmaceutical products, IT services also have chances of going beyond the border.

Nepal has quite young people and youths are excellent at IT. While working as envoy to Bangladesh, I saw the country making tremendous progress in the IT sector. They made a lot of profit by providing IT services to many countries. Nepal also can profit by providing IT services to various businesses outside the country.

You mentioned that there is demand of high value agro products in Germany. Producers of agro products such as tea, coffee have a hard time getting the market in Germany. How do they get access to the market in Germany to sell their products?
 In every German city, you find Nepali tea.  There is no tea shop without Nepali tea. If you want to sell your tea to the Germany, first get in touch with Tea Producers’ Association in Nepal as they already have contact with German importers. Second step is to get connected to the German importers and show them your products.

Germany is also one of the major sources of tourist arrivals in Nepal? As many as 36,000 tourists visited to Nepal in 2019. The number dwindled to 3,000 in 2021. What number of arrivals can we expect for 2022?
In 2022, I expect between 15,000 to 20,000 German tourists to visit Nepal. The arrivals will be back to pre-COVID figure in 2023. But, I suggest Nepal not to concentrate on numbers only. Add value to tourism. When you add value, tourists are ready to spend more. A problem I see in tourism in Nepal is haphazard construction of the roads destroying trekking routes and trails. For instance, trekking along the Annapurna route from Lamjung’s Besisahar is not good idea. The road constructed along the trekking route has diminished value of the trekking trail. No tourist wants to hike in the dust of busses and lorries. Thus, authorities have to be careful before constructing roads to preserve the tourist places and destinations.

What is your take on food, hygiene and pricing on the trekking routes and tourist places?
Food is okay. Usually, tourists get to eat daal bhat, and noodles. In remote areas, tourists do not expect a lot of options as well. Accommodation is also okay. They don’t expect star hotels and resorts in trekking routes. But, there are some issues regarding hygiene.  

Is there any possibility of resuming direct flight from Nepal to Germany?
I think Nepal Airlines will be interested to start flights to Europe. It would be good to have direct flight between Nepal and Germany. But, we have some aviation safety issues. Aviation authorities in European Union are demanding to have an independent safety body in Nepal. Once, the government establishes the independent safety body, the EU will think of allowing direct flight to Nepal.

Recently there was news that European Union was planning to lift the ban on Nepali airlines entering European airspace. Is the ban being lifted anytime soon?
It is right we are thinking to lift the ban. But, the pre-condition must be created by Nepal government. The ball is on the Nepali side.  Unfortunately, the discussion on the ban lift has gone for too long. EU will lift the ban once the government does something concrete in the field of aviation safety.

In 2019, Germany and Nepal agreed to set up bilateral consultation mechanism which was scheduled to meet annually. What is development on this? How effective has it been?
We were planning to reestablish the mechanism this year. However, due to elections on November 20, we postponed the idea. We have decided to postpone consultations until the new government comes into power.  Most probably, we will re-establish the mechanism in the first half of 2023.

Recently, German Embassy in Nepal helped organize Nepal German Mart 2022. What were the purposes, expectations and achievements of the programme?
That was a small step to help the members of Nepal German Chamber of Commerce members to create business opportunities. We offered the premises of the embassy for them to show their products. At the weekend, 500-600 visitors were there. Hopefully, we will repeat such a function next year. Maybe, we will shift the venue to another space due to security reason here at the embassy. But anyway it was a success - a good start.

Do you want to add anything else?
I would like to get back to tourism in Nepal. I see opportunities for tourism in areas where tourism has not developed yet. Until now, tourism is concentrated on few areas. Recently, I visited Karnali and there is a great opportunity for tourism there. You don’t need big investment for tourism development in remote areas like Karnali and other parts of the country. You can establish homestays and long distance trekking routes and serve the tourists with local food. In addition the cultural and ethnic diversity could also be explored for tourism. There is a lot more to see in Nepal than Everest and Annapurna.