The initiative to boost economic growth in LDCs by giving duty-free and quota-free access to exports proposed during the June 2002 G8 Summit in Alberta, Canada came into writing this week with a Memorandum of Understanding (MoU) between the governments of Nepal and Canada.

Lava Kumar Devkota from the Ministry of Industry, Commerce and Supplies and Peter Sutherland, Canadian ambassador to Nepal signed the MoU giving Nepali garments duty-free access to Canadian markets. The understanding has been effective since 1 January , 2003.

About a quarter of total textile exports from Nepal reach Canada. Garments and other textiles exported to Canada must still comply with provisions set by the rules of origin. The Garment Association of Nepal recorded exports worth $400 thousand in the first four months of this year alone, compared to $500,000 for 2002.