Part 4: Economic Changes




Some Quick Facts:

GDP (1994-est.): $4.1 billion.

Annual growth rate: 6%.

Per capita income: $200.

Avg. inflation rate (1993-94): 9.6%.

Natural resources: Water, hydropower, scenic beauty, limited but fertile agricultural land, timber.

Agriculture (42% of GDP): Products--rice, wheat, maize, sugarcane, oilseed, jute, millet, potatoes.

Land--25% cultivated.

Industry (20% of GDP): Types--carpets, garments, cement, cigarettes, bricks, sugar, soap, matches, jute, hydroelectric power.

Trade (1994-est. ): Exports--$460 million: carpets, garments. Major markets--Germany, U.S.
                              Imports--$1.3 million: manufactured goods. Major supplier--India.

Official exchange rate (December 1994): 49 Nepalese rupees = US$1.00.        
                                 (January 2006): 71 Nepalese rupees = US$1.00



The graph to the left shows Nepal's GDP from 1960 to 2000.  As you can see, Nepal has had a pretty steady growth rate over the past forty years.  Nepal has had a pretty good growth as well.  In 1960, Nepal's GDP was around $1.4 billion and it grew almost four times as big by 2000.  This growth is rather amazing considering that Nepal is still a developing nation.  What does this mean?  Perhaps Nepal will ontinue to grow and eventually prosper itself into a developed nation.  One interesting period is that of around 1981. This is the same time of the gas crisis that we had here in the US.  This is also the only period during this graph when Nepal's GDP had not grown. 
To the left is another graph showing the GDP of Nepal.  This graph shows the projected GDP for the next fifty years.  This graph is much differnt then that of the last forty years.  While Nepal's GDP is projected to continuously grow over the next fifty years like it did in the last forty years, it is projected to increase at an exponential rate.  It is projected to double by the year 2018, but will grow at a much faster rate after that.  By 2050, it is projected to be eight times the size of its 2000 value.  Another interesting note is that Nepal's GDP is projected to never have a negative GDP growth value over the next fifty years.  Something that should be noted is that these numbers are very optimistic and while I hope Nepal will do this well over the next fifty years, I don't think it will.
The pie chart to the left shows Nepal's production by sector in the year 2000.  As you can see, agriculture dominates Nepal's production.  This is interestin considering that almost half of Nepal is mountainous.  Materials and IC tech only make up 1.2% of Nepal's production when combined.  Energy is also a slight portion of Nepal's total production.  Services is about 25% of  Nepal's production which is larger then I would have expected.
This pie chart shows the projected production by sector in the year 2050.  In this short time period, Nepal's production has changed dramatically.  It is easy to see that Nepal will move away from agriulture and more towards services, which becomes the dominate sector in its prodution.  In just fifty years, the services sector doubles and the agriculture sector shrinks from 55% to 17%.  The manufactures sector also increases dramatically and nearly doubles by 2050.  This could help explain the projected growth of Nepal's GDP.  Nepal's dominate sector switches from agriculture, which is not a very profitable, to services and manufactures which tend to be more profitable.
This bar chart shows the projected GDP per capita for the World, South Central Asia and Nepal over the next hundred years.  This particular graph is very interesting considering the projected GDP of Nepal.  Nepal's GDP increased dramatically over the next fifty years, but its GDP per capita does not do as well compared to that of the World and its region in the same time period.  Nepal's GDP per capita does increase expontentially by the end of its projected period but is still far behind that of its region and the World.  When looking at the total change during this hundred years, Nepal's GDP per capita is 35 times the starting value of $200.  Nepal does start to close the gap by 2100.  In 2000, the World GDP per capita is 26 times that of Nepal's, but by 2100 it is less then eight times that of Nepal.



        According to projections made by the International Futures Database, Nepal's economic conditions will get better in a much shorter time
then one would think.  For instance, in the next fifty years, Nepal's production will dramatically change for the better allowing its GDP to increase by 800%.  As good as this sounds, Nepal did not decrease the gap of GDP per capita to by 2050 to the World and region.