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Nepal economy to "decelerate" following devastating quake: IMF
[SINGAPORE] The International Monetary Fund (IMF) said Thursday quake-stricken Nepal's economy will "decelerate" in the short term as the impoverished nation reels from plunging tourism revenue and higher imports following the deadly disaster.
The UN body said the country, with a per capita GDP of just US$1,000 per person, will suffer "substantial output losses" following the April 25 quake which devastated much of the capital Kathmandu and has killed more than 7,600 people.
"Growth will decelerate in the short-term. Loss of tourism revenues and higher imports will strain the external position," said documents circulated at a media briefing in Singapore.
The IMF did not specify an updated GDP forecast following the disaster, Nepal's deadliest quake since 1934. In its World Economic Outlook report released on April 14 - before the earthquake - the IMF forecast Nepal's economy to grow 5.0 per cent in 2015 and 2016.
Changyong Rhee, the director of the IMF's Asia and Pacific Department, said the body would try to build resilience in Nepal in the wake of the disaster.
An IMF team "will go to Kathmandu next week to assess the current situation and coordinate with other donors and international organisations," Rhee told reporters in Singapore at a briefing on the body's latest Asia and Pacific regional economic outlook report.
Before the earthquake, Nepal had a solid external position, with official reserves covering eight months of imports and public finances that were in "good shape", according to the IMF.
Nepal's GDP grew 5.48 per cent last year, the country's central bureau of statistics showed on the trading economics site, much improved from the 0.16 percent recorded at the height of a Maoist insurrection in 2002.
The civil war, which ended in 2006, left more than 16,000 dead. The government had begun to get the country back off its knees before the earthquake but political bickering has prevented the drafting of a new constitution.
Crucial to Nepal's growth is tourism. It attracted almost 800,000 foreign visitors in 2013 - many of them climbers heading straight to Mount Everest but also less adventurous tourists seeking the rich cultural history of Kathmandu.
That revenue stream is now in jeopardy after mountaineering companies on Sunday called off their spring expeditions to Mount Everest and with much of the capital's sites reduced to rubble.