Kathmandu. One of the biggest reversals since the 2008 global financial crisis is now being seen in the private credit market. This has alarmed investors around the world.
In the past years, companies in the software and technology sector have been given huge loans, but now they are at risk due to the increasing influence of artificial intelligence (AI) and market volatility. This can have a direct impact on IT startups and software exporting companies in emerging markets like Nepal. That’s because foreign investors are starting to think a hundred times before pouring money into the tech sector.
However, this crisis has also brought a golden opportunity for Nepal. Investors are now moving away from “invisible” assets like software to “booming” but durable infrastructure, such as hydropower and big infrastructure.
If Nepal can make its hydropower sector known in the world market as a safe and long-term productive destination, then a huge amount of capital that has gone out of the technology sector can come here. However, we need to be cautious that the burden of foreign debt may become more expensive as such financial storms in the global market strengthen the dollar and increase international interest rates.
Although Nepal is not directly at the center of this storm, this change in global capital will certainly affect Nepal’s banks, hydropower projects, and technology dreams in new ways.
