A. Debt cancellation. Much of the scanty resources of the LDCs are directed to debt servicing. One-third of Nepal's internal revenue is utilised in servicing past debts. Debt cancellation will release significant resources for investment in the social sector and for infrastructure development of the LDCs.

Q. Are you satisfied that this conference is heading in the direction of debt cancellation?

A. Well our views on debt cancellation are not shared by many developed countries. But we are negotiating for a moratorium on debt servicing and are about to reach some agreement even if it is an agreement to work towards such a moratorium.

Q. Minister, there were several promises made at the opening of this conference regarding a better deal for the LDCs in terms of unfulfilled promises proceeding from the Uruguay Round ...

A. Unfortunately there has been no breakthrough so far because of the position taken by the developed countries - but we are still negotiating.

Q. What is your view on regional groupings?

A. After accession to the WTO the only way the LDCs can protect their own interests is through regional groupings and anyway the WTO allows regional
groupings.

Q. Nepal is one of nine LDCs that have applied for accession to the WTO. What are your views on their prospects?

A. The problem is that they are talking about exra-conditions for entry - This is bad. We should have the right to enter as equals. What we are demanding is easy and early accession and we think that we are heading for some agreement on this issue. Special and differential treatment provisions should be implemented and an extension of the transitional period should automatically be granted to acceding LDCs.

Q. Nepal and other land-locked countries have special problems. Were they adequately addressed at this conference?

A. This meeting has been organised for the problems of LDCs in general. But we are using every opportunity to highlight high cost of transport, freight and insurance borne by the land-locked countries - more than 25 percent in Nepal's case as compared to the global average of five percent. We expect that this conference will have something for land-locked countries.

Q. What is your view of market-oriented reform in the LDCs?

A. The experience of Nepal has been that some of our market-oriented reform actions have entailed increased burden on the common people in the short term. Weak institutional capacity, rising cost of internal security, widening resource gap, declining net external assistance and declining grant to loan ratio have all affected us.

Q. What can the international community do immediately to help the LDCs?

A. They can provide duty-free, quota-free market access for all products from the LDCs and remove non-tariff barriers that impede exports of the LDCs. We welcome the everything but arms (EBA) initiative of the European Union but urge other major trading countries or groups to extend similar facilities to the LDCs.