Fiscal Nepal
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EU Ambassadors
UMESH POUDEL/KATHMANDU: Nepal’s relations with the European Union (EU) appear to be entering a new phase of diplomatic, economic, cultural and investment cooperation, as a high-level European diplomatic delegation expressed strong confidence in Prime Minister Balendra Shah’s reform agenda, political stability, and commitment to fast-track Nepal’s development.
During a high-level joint meeting held at the Office of the Prime Minister and Council of Ministers in Kathmandu, ambassadors from the European Union, EU member states, and diplomats stationed in Kathmandu and New Delhi met Prime Minister Balendra Shah to discuss Nepal’s evolving political transition, investment climate, education, tourism, culture, infrastructure, and the future direction of the 52-year-long Nepal-EU partnership.
The delegation was led by EU Ambassador to Nepal Véronique Lorenzo, who later addressed a press conference and described Prime Minister Shah as a determined leader with “strong reform intentions” and a clear vision for delivering impactful transformation in Nepal.
Speaking after the meeting, Ambassador Lorenzo said the EU delegation found Prime Minister Shah highly committed to bringing meaningful and lasting reforms in Nepal.
“We found that Prime Minister Balen Shah has a strong reformation agenda to do something greatly impactful for Nepal,” Ambassador Lorenzo said, emphasizing that the new leadership has demonstrated seriousness about governance, development and institutional delivery.
According to the EU delegation, Prime Minister Shah presented a clear timeline, structured agenda, and implementation-oriented roadmap for Nepal’s development priorities, signaling consistency in governance and decision-making.
The diplomats particularly noted Shah’s message of determination and accountability, saying the Prime Minister strongly conveyed that his government was “here to deliver the expectations of Nepalis.”
The meeting reportedly focused on political stability, economic opportunities, institutional reforms, governance efficiency, youth engagement, and ways to deepen cooperation between Nepal and European nations at a time when Nepal is seeking stronger international partnerships.
A major focus of the diplomatic engagement was the long-standing relationship between Nepal and the European Union, which has now crossed 52 years of partnership.
Officials discussed strengthening cooperation in education, culture, sustainable tourism, economic transformation, green transition, governance reforms and people-to-people relations.
Ambassador Lorenzo noted that the EU sees Nepal as an increasingly important strategic partner in South Asia, particularly following the emergence of a new political landscape after the recent Gen Z-driven political movement and elections.
“We found that a new government has been formed in Nepal after the Gen Z movement and election. Nepal today represents opportunities,” Lorenzo said.
She added that European diplomats have observed what they believe is a conducive environment for investment and international engagement under the new administration.
“We appeal to the international community to engage more with the Nepali government right now,” she said, suggesting that Nepal is entering a potentially transformative period for foreign investment and institutional cooperation.
In remarks likely to attract attention from international investors and Nepal’s business community, Ambassador Lorenzo revealed that the European private sector—rather than only government institutions—is increasingly engaging Nepal for trade promotion, business partnerships and investment opportunities.
“EU private sector actors are engaging Nepal more actively for business promotion and investment,” she said.
She further revealed that before meeting Prime Minister Shah, members of the EU delegation had held consultations with Nepal’s private sector representatives, civil society members, journalists, and policymakers to assess Nepal’s current economic and political climate.
According to Lorenzo, discussions particularly centered around Nepal’s banking, tourism and energy sectors, which European stakeholders reportedly see as areas with significant growth potential.
“People we met were very optimistic about Nepal’s new government,” she said, adding that business communities and social stakeholders conveyed confidence about future reforms and economic expansion.
This positive outlook, according to the EU delegation, aligns with Europe’s growing optimism regarding Nepal’s medium-term growth trajectory.
The European delegation also held separate meetings with Nepal’s Minister for Culture, Tourism and Civil Aviation, Khadak Raj Poudel, Minister for Education and Sports, Sasmit Pokharel, and Minister for Foreign Affairs, Sisir Khanal.
According to EU officials, culture and education emerged as major pillars of future Nepal-EU cooperation.
“We are more focused from the cultural and education perspective in Nepal and are willing to do something impactful in the near future,” Lorenzo said.
European diplomats reportedly explored opportunities for expanded academic partnerships, cultural preservation initiatives, skills development programs, youth mobility and educational exchanges.
The EU delegation repeatedly emphasized Nepal’s youth population and the emergence of a politically active Gen Z generation as a major factor shaping Nepal’s future.
European diplomats said young Nepalese are increasingly aspiring toward education, innovation, entrepreneurship and international engagement, creating opportunities for deeper Nepal-EU cooperation.
“We have priorities toward Gen Z and especially youths, and the EU is always in engagement for better outcomes,” EU representatives said.
Prime Minister Shah, meanwhile, reportedly stressed that young generations should be expected to play a leading role in nation-building and development.
He encouraged greater international support to empower young people, innovation and modern governance systems.
Highlighting strong people-to-people ties, Ambassador Lorenzo said migration trends between Nepal and Europe have increased substantially in recent years.
She noted that Nepali students and workers are performing strongly across European countries, while migration to the EU has risen at an exceptional pace.
“We have people-to-people engagement since long, and Nepali students and workers are studying and working in European nations very well,” she said.
“The migration is spiking and growing at an exceptional rate in EU countries.”
According to the ambassador, European nations are increasingly becoming preferred destinations for Nepali students, professionals and workers seeking global opportunities.
“We found that Nepalese are prioritizing EU countries massively and they love our nations,” she added.
In a diplomatically significant statement, the EU ambassador revealed that several European countries that scaled down or permanently exited Nepal following the devastating 2015 earthquake are now preparing to return.
“Some EU countries left Nepal permanently after the 2015 earthquake, and now they are coming back to Nepal and planning to reopen embassies soon,” Lorenzo said.
The move could mark a renewed diplomatic push and stronger European institutional presence in Nepal amid growing geopolitical and economic competition in South Asia.
Representatives from European nations also shared country-specific observations about Nepal’s future development path.
The Ambassador of Sweden to Nepal said European stakeholders are closely monitoring Nepal’s new government and observing developments on the ground.
He suggested Nepal should focus on becoming a destination for high-demand tourism segments and diversify its tourism offerings to attract premium international visitors.
The comments come as Nepal seeks to reposition itself globally as a major destination for adventure tourism, cultural tourism, wellness travel, Himalayan trekking and sustainable tourism.
Meanwhile, Italy’s ambassador to India reportedly praised Prime Minister Shah’s ambition and reform-oriented governance approach.
According to the diplomat, Nepal has witnessed “dramatic changes” in recent times and there are significant opportunities for bilateral collaboration in tourism, hydropower equipment, critical infrastructure protection and cultural heritage promotion.
European countries are also showing increasing interest in supporting Nepal’s hydropower ambitions, sustainable infrastructure and science-backed protection of critical national assets.
The Ambassador of Estonia to India highlighted the Baltic nation’s experience as one of Europe’s most digitally advanced economies and indicated opportunities for knowledge sharing in e-governance and digital transformation.
For Nepal, which is increasingly prioritizing digital governance and smart public services, Estonia’s expertise could offer valuable lessons in public administration modernization.
Similarly, the Ambassador of Austria emphasized his country’s expertise as a tourism-driven economy and expressed willingness to share experiences with Nepal.
European support in mountain tourism, hospitality, winter tourism systems, destination branding and infrastructure could become increasingly relevant as Nepal seeks to increase tourism earnings and attract higher-spending travelers.
On Nepal’s long-standing placement on the EU Air Safety List, European diplomats expressed cautious optimism that recent institutional changes in Nepal’s aviation sector could help the country make progress toward removal.
The EU delegation acknowledged less efforts made by former Director General of the Civil Aviation Authority of Nepal (CAAN), Pradeep Adhikari, in working toward compliance with international aviation standards.
They also expressed hope that newly appointed CAAN Director General Mukesh Dongol would effectively handle aviation regulatory reforms and accelerate Nepal’s exit from the EU safety list.
The development is particularly significant for Nepal’s aviation and tourism sectors, as removal from the EU safety blacklist is widely seen as essential to restoring international confidence, boosting airline connectivity and strengthening Nepal’s tourism competitiveness.
The EU delegation’s visit comes at a time when Nepal is attempting to reposition itself as an investment destination, expand tourism recovery, modernize governance and accelerate development following political transformation.
With European diplomats signaling optimism about Nepal’s political stability, reform momentum and economic opportunities under Prime Minister Balendra Shah, observers say the visit may indicate the beginning of a more strategic and investment-focused chapter in Nepal-EU relations.
For Nepal, which is navigating a critical phase of economic recovery, youth aspirations, institutional reform and global competitiveness, the message from European diplomats appeared clear: Europe is watching closely—and increasingly ready to engage.
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