World Trade Organization and its Impact to Nepal

12 Pages Posted: 7 Jun 2010

Date Written: June 7, 2010


In its quest to move along with global economic development, the Nepalese government realized that it cannot remain aloof from the waves of globalisation. Consequently, it applied for the membership of the General Agreement on Tariffs and Trade (GATT) in May 1989 and was subsequently given an observer’s status. The World Trade Organisation succeeded GATT from 1 January 1995.Nepal acceded to the World Trade Organization in 2004 as 147th member of the multilateral trade body and as the first least-developed country to have joined the institution through the process of accession. WTO is now the third economic pillar of worldwide dimensions along with the IMF and World Bank. WTO membership was simply a beginning of the process to integrate Nepal into the global economy in a meaningful manner. Trade between nations is increasingly being conducted under the rules and agreements negotiated at the WTO. WTO membership will help Nepal integrate with the global trading system .The special provisions of the WTO will guarantee a predictable and stable trading environment for the Nepalese SMEs. The two fundamental principles of the WTO, namely “Most favored nation (MFN)” and “national treatment,” will enhance the export potential of Nepalese products and services. Under the MFN clause, the Nepalese products and services will get access to global markets at equal or no less terms than being enjoyed by other WTO members. Similarly, the national treatment provision guarantees that the Nepalese goods and services will receive the same treatment as the goods and services of the importing country.

A small, land locked, poor and donor dependent country like Nepal the membership to the WTO is not a matter of choice. Membership of WTO was necessary; whether consequences are positive or negative. So the only choice Nepal has to mitigate the negative consequences and try to utilize potential benefits.

The author has tried to analyze both positive as well as negative impacts to Nepal after WTO membership and has disseminated various trade reports of pre as well as post accession period to WTO.

Keywords: WTO, Nepals Benefit and Challenges, Bikash, Thapa

Suggested Citation

Thapa, Bikash, World Trade Organization and its Impact to Nepal (June 7, 2010). Available at SSRN: or

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