Does the Sun rise over Nepal, not India, China & Japan

Once manufacturing skills brought economic success, the global market now offers other routes
Everybody knows about the great historic trends driving economic globalization: the end of communism, which has united the world for the first time in history under one economic system; the emergence of china, India and other developing countries that brought three billion new worker and consumers into this global trade for the first time; and the virtual elimination of transport and communications costs, which has made it possible for the whole world economy to function as one. But many of the consequences that follow logically from this process are still not understood.
Particularly relevant to the contrast between Nepal; India, China and Japan. First manufactured goods, whose production is readily transferable to low cost economies such as China, are falling relentlessly in price. Secondly, this process of outsourcing has created a new type of business called “the platform company” by Charles Gave, the French economist.
Platform companies sell everywhere but produce nowhere – business such as Dell, Nokia, Ikea, Glaxo, Apple or L’Oreal. Where, for example, are the factories owned by Ikea or Dell? They do not exist, because these companies subcontract almost all their manufacturing to other businesses, mostly in developing countries. Any business process can be divided into three stages – design, production and marketing – and platform companies have perceived that the relative value of these stages – and platform companies have perceived that the relative value of these stages has fundamentally changed. In the 20^th century, control over production was the key to business success. Today the other two stages add most value, because production can be shifted to subcontractors in developing countries that compete intensely to reduce costs.

A brief analysis of the country we are in: Nepal

Europeans will recognise in the traditional political economists like Keynes, Polanyi and Shonfield; American will see it in the tradition of a Golbraith, Reich or Throw- and Friedman, on the right of the political spectrum.
I think if we attempt to isolate economics from other disciplines- notably politics, history, philosophy, finance, constitutional theory and sociology- has seriously disabled its power to explain what is happening in the world. There is too much ideology passing itself off as science, and the results have been lamentable.
Political argument that the semi-modern nature of Nepal is a fundament cause of Nepal’s economic and social problems. Markets are embedded in country’s social and values whether we like it is or not. It falls to the state to govern both the economy and society, and the character of the country’s political institutes themselves shapes the democratic character and the efficiency of governance. The constitution, which defines the responsibilities and institutions of government, is thus a central determinant of how the century is governed.
The urgency of addressing the country’s financial and constitutional system grows by the year. Ungoverned Nepal capitalism’s lethal demand for some of the financial returns in the world has encouraged firms relentlessly to exploit their new freedom to hire and fire. As a result there is a mounting and quite proper sense of crisis spreading across all classes about the character and availability of work and its implications for every aspect of society-from the care of our children to growing dereliction of our cities. Official unemployment figures, alarming enough, only tell part of the story. Insecurity, low wages and wasted talent are widespread, and problem touches professions and occupations once thought inviolable.
These does not mean change should be resisted; but it does mean that Nepal need better institutions with which to survive and prosper. We need a decent political system as much as proper financial and welfare system; we deserve a better structure for our firms, resources for education and training, and economic institutions that go well beyond the boundaries of the nation and state.
What is required is creative institution-building and a democratic opening- and confidence that men and women can shape heir world.
Yet in the last decade of the twenty first century the record of success is tarnished and any sense of privilege is evaporating. The country’s great industries are decaying and listless, while in the new industries and technologies Nepal is barely represented.
For decades of unemployment has been a grim fat of Nepalese life, bearing particular hard on men. As well as those included in the official count who want work and can’t find it, there are millions more who are marginalised-prematurely retired or living off inadequate savings of sickness benefit. Two in five of the country’s males of working age is now either official unemployed or idle, with incalculable consequences for our well-being and social cohesion. The numbers living in poverty have grown to awesome proportions, and the signs of social stress-from family breakdown to the grown of crime-mount almost daily.
As the economy weakens the country’s international prestige is warning. (Its capacity to cling on to its privileged position in the world pecking order.)
Above all, we live in a new world of us and them. The sense of belonging to successful national project has all but disappeared. Average living standards may have gone down and have not generated a sense of well-being; if anything there is more discontent because the gains have been spread so unevenly and are felt to be so evanescent. The country is increasingly divided against itself, with an arrogant officer class apparently indifferent to the other ranks it commands. This privileged class is favoured with education, jobs, housing and pensions. At the end of the scale more and more people discover they are the new working poor, or live off the state in semi-poverty. Their paths out this situation are closing down as the world in which they trapped becomes meaner, harder and more corrupting. In between there are growing numbers of people who are insure, fearful for their jobs in an age of permanent ‘down-sizing’, ‘cost-cutting’ and ‘casualisation’ and ever more worried about their ability to maintain a decent standard of living.