A. Trade

Along with further development of the friendly relations between China and Nepal, the trade cooperation between the two countries is increasing rapidly. The trade volume between China and Nepal in the last three years is as follows:

The main products exported by China to Nepal are as follows:

Machinery and electric products, agricultural products, chemical products, textiles, light-industry products, garments, raw silk, building materials, electronic equipment and household appliances, etc.

The main products imported by China from Nepal are as follows:

Agricultural products, textiles, light-industry products, handicrafts, etc..

It is quite complementary in terms of trade cooperation between the two countries. Machinery and electric products (such as aero planes, automobiles, motors and engines, motorcycles, tractors, battery-driven bikes, mechanical machinery, communication equipment, etc.),household appliances, agricultural products, textiles and chemical fertilizer are badly needed in the domestic market of Nepal, and the market occupancy is in uptrend, while the agricultural products of Nepal like vegetable ghee and wheat flour are the goods in great batches needed by the Tibet Autonomous Region of China. In a glance of the trade cooperation between China and Nepal in the last three years, we can say that Chinese products, especially machinery and electric products, are taking bigger occupancy in the domestic market of Nepal.
In the year of 2001 the export volume from China to Nepal was a little bit declined, but more and more Chinese automobiles, motorbikes household appliances, etc., are entering the market of Nepal not only in increased quantity but also in increased variety.

B. Investment

With the healthy and steady development of the Chinese economy, more and more Chinese enterprises start to become globally oriented, seeking the optimization of resources around the world. The Chinese government timely set forth the development strategies encouraging enterprises to "join the world". Series of encouraging policies have been formed.

As the neighboring country of China, Nepal appeals to Chinese investors to some extent. In recent years, the amount and share of Chinese investment has been increasing. At the present, the number of the projects and the amount of investment registered in the Industry Department of His Majesty's Government of Nepal ranks the fourth place. Major Chinese investment projects in Nepal include the following: Upper Modi Hydroelectricity Project (BOT), Nilam Medicine, Nepal Radio Paging, Rainbow Food, China Mountain Restaurant, Panda Restaurant, Beijing Roast Duck among others. These investment projects play a positive role in promoting the development of local economy and in enhancing the quality of people's life by enriching the life.

Though Chinese investment in Nepal has not reached a large scale and the amount is not huge presently, more and more Chinese enterprises will invest in this beautiful country as Nepal becomes more and more politically stable and with the establishment of New Investment Policies and its entry of WTO.

C. Nepal -Tibetan Trade

Trade relations between Nepal and Tibet can be traced back to ancient history. Various forms of trade have been practiced at the boarder. During 50's, trade has been suspended for a certain period of time because of historical reasons. Since 1962 when trade resumed, people from both sides of Himalaya witnessed a steady growth of trade. Especially after the establishment of the open-door policy of China, the economic and trade relations have been greatly increased and play a important role in the economic development for both China and Nepal.

According to statistics released by Rastra Bank of Nepal, in year 88/89, trade between Nepal and Tibet was only about 514 million Rupees. It increased to 4.2 billion Rupees in year 99/00.
Forms of trade have been shifted from single barter trade to various forms. Businessmen and entrepreneurs from both countries have engaged themselves in investments and join-ventures in each others country. Payment can be made in U.S.D, RMB or Nepalese Rupees by T/T, L/C or bank draft. Boarder trade is limited to the residents of both countries living within 30 kilometer to the boarder. Boarder trade is carried out in Zhangmu.

Commodities imported from Nepal to China includes rice and wheat flour, sugar, dying materials, copper, ghee and other 60 or so items. China's export to Nepal includes wool, silk, garlic, electrical appliance, footwear, synthetic carpet, tools and 100 other items.

The 8th Nepal-Tibet Trade Fair was successfully held in Lhasa in October, 2001. A great success has been achieved in terms of number of participants and number of import and export contracts concluded during the fair. Organized jointly by the organizations concerned from both sides and our embassy, there are more than 100 businessmen and entrepreneurs from Nepal to participate the trade fair. During the fair, all exhibits they brought along have been sold out, and a number of import and export contracts have been signed between businessmen from both sides. The organizer of the fair in Tibet, the Foreign Economic Relations and Trade Administration of Tibetan Autonomous Region of the People's Republic of China put great efforts and importance to ensure the success of the fair. In order to develop trade between Nepal and Tibet, both sides decided to establish the trade fair facility every two years alternatively in Lhasa and Kathmandu. Eight sessions of trade fair have been held till now. The local government of the Tibetan Autonomous Region have also extended their great support by inviting more 70 companies, more than 200 participants through out the country to attend the fair, and organized more than 1360 items of commodity on the show.

According to the arrangement agreed by both countries that the next trade fair shall be held in Kathmandu in 2003.

D. China-Nepal Non-Government Forum

On April 18, 1996, during his visit to the People's Republic of China, Mr. Deuba, Prime Minister of Nepal, participated in the official signing ceremony of the "China-Nepal Forum for Cooperation" together Premier Li Peng. President Jiang Zemin spoke highly of the forum during his official visit to Nepal at the end 1996. He expressed his hope that on the basis of past experience, both governments of Nepal and China should give their full support to the forum to fully utilize this cannel for finalization of some projects for the benefit of the peoples of our two countries. Since then, 5 sessions of the forum have been held alternatively in China and Nepal and achieved great success.

First Session: Kathmandu in October 1996
Second Session: Beijing in September 1997
Third Session: Kathmandu in December 1999
Fourth Session: Wuxi in November 2000
Fifth Session: Kathmandu in November 2001

The fifth session of the forum held in Kathmande in November last year was a great success and made greater achievements than ever before to the satisfactory of both sides. The Prime Minister of Nepal, Mr. Deuba participated in the opening ceremony and delivered a worm speech speaking highly of the friendly relationship between out two countries and the need to further develop the economic and trade relations. Through various meetings and discussion between businessmen from both countries during the session, mutual understanding have been reached for further development of economic and trade relations.