Export performance and potential with regional partners: The case of a landlocked LDC, Nepal

Ramesh Paudel () and Swarnim Wagle

Departmental Working Papers from The Australian National University, Arndt-Corden Department of Economics

Abstract: This paper assesses export performance and potentials for increased bilateral trade with regional partners of Nepal, a least-developed country (LDC) in South Asia. Following an overview of the country's export performance, and the distinct policy and logistical challenges it faces as a landlocked country, an econometric analysis of the determinants of bilateral exports is undertaken using the gravity modelling framework. The results suggest that the 'structural' factors such supply-side constraints, distance to markets, and cultural proximity as geographical and cultural proximity have mattered more than trade and other policy barriers imposed by destination markets. The paper also identifies partners to which Nepal appears to be "under-exporting," and concludes that there is much room for the country to integrate further with regional markets if it were to overcome its supply side constraints.

Keywords: Nepal; export performance; gravity model; landlocked countries; regional integration (search for similar items in EconPapers)
JEL-codes: F11 F12 F13 O50 (search for similar items in EconPapers)
Pages: 31 pages
Date: 2017
New Economics Papers: this item is included in nep-int
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Persistent link: https://EconPapers.repec.org/RePEc:pas:papers:2017-06

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