Private sector leaders need to translate words into action

KATHMANDU, April 10:

The Federation of Nepalese Chambers of Commerce and Industry (FNCCI), the umbrella organization for the Nepali private sector, is getting new leadership within April 13 after its 48th annual general meeting (AGM).
Business people from across in the country are now gathered in capital to choose their new leaders, but it is not easy to predict who will get to steer FNCCI through its next phase. Two presidential candidates -- Pradip Jung Pandey and Bhaskar Raj Rajkarnikar -- are in the battle; both have comparative strengths and weaknesses.

But the issue is not who will lead FNCCI. The issue is what the leadership should do.

No matter who comes on top, the election amount to much in the long-run unless the leadership shows the correct way in order to provide proper guidance to the private sector. Both of the presidential candidates’ agendas, which prioritize strong private sector, business with social responsibility, and attracting investment, sound good, but the real test begins when they try to translate their words into action after winning the crown.

ECONOMIC PROGRESS AND PRIVATE SECTOR

‘The Nepali private sector is more bureaucratic than government’, has become a widely shared view in recent times. Such kind of appraisal of the Nepali private sector from critiques has surfaced because of their inefficiency, incompetence and ambiguity, and that needs to be corrected quickly.
The private sector is undoubtedly an engine for economic growth. But it always bargains for facilities and blames the government for the stagnant economy. Around 1,500 youths are going abroad each day to seek jobs. This is not only an unfortunate situation for Nepal but also a challenge for the private sector as well.
“The private sector should focus on labor-intensive industries to create more jobs within the country,” Dr Chiranjivi Nepal, economic advisor to the Office of the Prime Minister and Council of Ministers (OPMCM), says. The private sector says it has not shown readiness to invest because of a long-drawn political transition process and political instability. Although somewhat true, it in self is not the final end, according to him.
“The private sector is not only affected by political transition but also deflated,” says Suraj Vaidya, the outgoing president of FNCCI, adding “the private sector is compared with the cooperatives sector as pillars of economic development in interim constitution.” Vaidya also concedes that the private sector has been slammed from this conception of law-makers. He accepts that the private sector has wasted a decade without any achievement waiting for peace and political stability since the political change of 2006.
Nepal also accepts the Vaidya’s point that private investment needs protection and surety of return. But the private sector also has to consider the responsibility toward the nation, according to him. “The foremost thing is the zeal of private sector to lead economic growth,” Nepal says, adding “A lot of investment opportunities remain untapped, investors have to look at those opportunities.” Finally, he stresses on the joint initiatives between the government and the private sector to graduate the country as a developed nation.

DIVISION CREATES MORE PROBLEMS

Whatever the candidate says, what has been happening in FNCCI in the past few years is an ‘open secret’. The panels led by the two presidential candidates are creating a clear rift among the business people right from the local level in districts and municipal chambers of commerce and industry.
“The panels are creating more division and this will hit the strength of FNCCI,” commented senior economic journalist Bijay Ghimire, who has observed several elections of FNCCI. He also shared that the presidential candidates bearing the expenses and logistics of the representatives from the local bodies in regard to ensuring votes is wrong.
“It sets a trend of buying votes and damages the image of the institution,” Ghimire said. Panels create divisions and ensure that no candidate from a single panel gets victory, according to him. It takes more time for smoothing relations between the team members elected as executives from across the panels.
Unity and harmony among the business peoples is a pre-requisite to making a strong private sector, he further said. The private sector leaders should learn from the bitter experience of the past. FNCCI is the only recognized umbrella body with a large network across the country and plays the lead role in economic progress.

CLARITY IN GUIDING PRINCIPLES

FNCCI has been slammed for things like protecting syndicates and cartels as well as abusing quality control and business ethics and other related issues which are directly hurting consumers. The private sector must be responsible and transparent toward the society to earn a reputation in the business. They should promote competition for quality of service and delivery. FNCCI should not lobby for protection of wrong-doers like what happened in the case of jewelry dealers, drinking water suppliers and value-added tax (VAT) defaulters.
The private sector should focus on mega-projects and take advantage of cost efficiency. It can also lead the cooperatives sector as well by linking them in their value chain.
The major troubles of the Nepali economy are low productivity, a burgeoning trade deficit and high inflation. To shut out the major challenges that emerge in the economy, the sector should focus on creating employment, boosting productivity and increasing exports of goods and services rather than exporting raw-labor to Gulf nations. The private sector leaders should mull on the hardships that country is facing.

CREATE HARMONY WITH GOVERNMENT AND SOCIETY

The private sector is always guided by profit-making motives and nobody should question this motive. That’s why they should do ethical business. Some of private profiteers -- guided by ill-intention and seeking overnight profits -- are delivering inferior services and goods. Evading taxes should be punished. The private sector organizations have to play a supportive role to its members follow laws and harmonize relations with government rather than warring with them. Thus, the private sector harmonizes the relation with the government and lobby to bring in essential laws and rules to enable economic environment will give benefit to entire society.
Likewise, some private sector leaders are seeking such policies and laws to help their own business thrive. They are being narrow-minded and need to think about a wider perspective.
“In the context, the government offered to allow the private sector to invest in infrastructure projects, the private sector should have to strengthen their capacity,” said Deependra Bahadur Kshetry, a former chairman of the National Planning Commission (NPC), adding “They have to prove their competency by implementation of some infrastructure projects."

Source: Republica