Dr Gail Marzetti has been the Head of DFID Nepal (the UK government’s Department for International Development) since 28 October 2013. An Agricultural Economist with a strong background in development, she has experience of working in various countries including Brazil and Mozambique. She believes that Nepal can be a prosperous nation by utilizing its resources. She spoke to Siromani Dhungana of New Business Age regarding DFID’s engagement in Nepal. Excerpts: As the new DFID head, what plans will you execute in Nepal in the coming years?
Department for International Development (DFID) is a part of the UK government. DFID’s main programmes have been around promoting transformative change in Nepal and looking for ways to promote economic growth. DFID has been working on securing development benefits for the poorest people by ensuring good health, education and better access to infrastructure. DFID is committed for inclusive economic growth while safeguarding development benefits through working on climate change and disaster risk mitigation. Nepal is a country prone to higher risk of climate change and earthquake and we are committed to provide assistance in these areas.
DFID has developed an operational plan that will cover up to the end of March 2015. The plan has four main pillars: inclusive wealth creation, governance and security, service delivery and climate change and disaster resilience. Gender and social inclusion is a major cross-cutting theme throughout all of our works. We, in partnership with the Government of Nepal, aim to create 230,000 jobs, lift 570,000 people out of poverty, avert 400,000 unwanted pregnancies, support 7 million people to vote in elections and make 4 million people better able to cope with natural disasters by the end of this period. These are the tangible outcomes we look forward to have.
What are the main priority areas of DFID in the changed political scenario, i.e., after the success of the second Constituent Assembly election?
It was good to see high voter turnout in a transparent and free manner during the second CA election. The new government has come up with a fresh mandate. What’s really important is that there is now a stable and certain government to lead the country. Our main interest now is to recognize that Nepal has moved away from post-conflict transition. We want to see Nepal as a country where economic growth will be unleashed in the future. We will be targeting our support in removing bottlenecks and facilitate economic investments towards areas where growth can be increased.
Nepal's domestic economy is characterized by low productivity and under investment. What approach has DFID taken to assist in Nepal's effort to achieve a sound economic growth?
Nepal has achieved reasonable growth rates over the last few years despite political uncertainty. Nepal has really done well in reducing poverty, from 53 per cent in 2002-03 to 25 per cent in 2010-11. However, more things need to be done. Businesses need political certainty along with good infrastructure, effective information systems, and government policies. DFID has been involved in many development activities. One of them is to look at the regulatory environment for investment. Similarly, DFID has been working with the International Finance Corporation to build a platform for dialogue between the government and the private sector. We are also working on facilitating big private investment in Nepal such as hydropower.
In its operational plan, DFID has estimated that 230,000 jobs will be created by 2015. Can you share the progress?
As per our latest estimate, we have created around 30 thousand jobs. This includes both short term jobs (eg short-term employment on rural roads construction) and long term-jobs through skill training. So, we are right on track in achieving the target.
It seems DFID is quite keen about the Private Public Partnership (PPP) model. Do you have any plan to work with the private sector in Nepal?
Nepal needs more private and public investment to reduce poverty. The government needs to remove bottlenecks that are stopping the investment. It is worth stating that the PPP model can be a powerful tool and it can make a huge difference when it is used at the right place at the right time. An example of where we are engaging this model is in hydropower. If the government could unleash hydropower potential of the country, all the benefits and jobs that would come from that sector would make an enormous difference. However, PPP model is not the sole panacea. We need to choose appropriate operating models to ensure effective results. UK’s Secretary of State has stressed that we should be engaging more with the private sector. The private sector is the one that can bring in innovation, increase revenue through taxes, helps in employment generation and can boost investment. Nepal lacks quality investments that contribute in value addition and this is holding the country back. We have to look at the different sectors to find the best way of unleashing that potential.
DFID’s investment in infrastructure projects has been highly praised by independent observers. What are your plans for the same in the coming days?
DFID has been supporting in rural roads programmes for a number of years. Linking communities together through road connectivity is really important for development. We will continue to do that and that will remain an important part of our future portfolio. DFID has also started working with the World Bank on road safety project, particularly in the central region. Making infrastructure safer is also one of our areas of concern. We provide assistance to local communities in projects such trail bridges, earthquake resistant buildings projects etc which will have direct impact on their livelihoods. We have quite a lot of infrastructure related work related to seismically retrofitting hospitals and schools. We are working with the Ministry of Health and WHO on a project to improve the seismic resilience of Nepal’s hospital infrastructure. Surveying of 59 large hospitals and capacity building for local engineering companies is due to be completed this year. This will result in the identification of 10 priority hospitals which will be taken forward for retrofitting. DFID anticipates funding some of these hospitals and will be seeking additional support from other donors to cover the remainder.
It is also said that foreign aid increases dependency rather than contributing in alleviating poverty and other development activities. What’s your opinion?
There is a huge debate on whether aid money creates dependency or it contributes in alleviating poverty. What I have seen in my career in DFID over last 20 years is a big reduction in the number of countries where we have bilateral programmes. When I started working in DFID, there were about 48 countries where DFID had bilateral programmes. Now, it is down to 28. I was involved in evaluation of aid money to Brazil and the withdrawal of UK aid from there.
Aid really works and can make a difference. Donors don’t want to work in a country forever. What they want to see is the development of the aid-recipient country, reducing its aid dependency and get up on its own feet. Nepal has already made significant progress on hitting the first MDG to halve poverty earlier than the targeted date, which is the next year. If Nepal can continue the progress rate for next 10-15 years, Nepal will be free of chronic poverty and it might not need any more donors. I would like to see Nepal joining the group of middle-income countries which is also priority of Nepal government.
What are your plans during your tenure?
DFID Nepal is committed to execute its operational plan. It is currently spending about £100 million a year. We will maintain it for the next few years as we support the government in its objective to graduate from least development nation’s status by 2022. Celebrating 200 years of Nepal-Britain diplomatic relationship will be an important event during my tenure. We want to see a strong and stable government to work with that can ensure faster economic growth of Nepal.
