Kathmandu, December 11
The Pacific Asia Travel Association (PATA) has painted a bleak outlook of Nepal’s tourism sector, warning of a high probability that many tourism-related small and medium enterprises (SMEs) will go out of business and the tourism industry will face a significant loss of human capital.
In a report titled ‘COVID-19 and The Tourism Sector: A comparison of policy responses in Asia Pacific’, PATA has said that despite the re-opening of domestic tourism, it is unlikely that the tourism sector will stay afloat until international visitors return.
But this could take time as ‘the demand for international tourism in Nepal has dried up due to a rising number of community transmissions of COVID-19 in the country’.
Like in other parts of the world, Nepal’s tourism industry was among the first to bear the shock of the pandemic.
In 2019, the country had 1.2 million international arrivals, leading to tourism revenues of $2.2 billion, which was 7.9 per cent of its gross domestic product, and provided over a million jobs for local workers — 6.7 per cent of total employment. This year, Nepal’s
tourism-related revenue is expected to be 80 per cent lower than its 2019 levels.
“The country’s tourism operators are either paying staff a substantially reduced salary or have put them on leave without pay. Airlines, hotels and big operators are now going into debt, while domestic SMEs are gradually going out of business,” says the report.
Nepal has allocated roughly four per cent of its GDP to respond to the pandemic. The fiscal and monetary measures focus primarily on tax incentives and concessional loans, according to the report, ‘but do not provide any immediate monetary relief to the majority of tourism companies struggling to operate during the pandemic’.
Meanwhile, the continuing national lockdown has hampered the government’s implementation of its work pay programme for low-wage workers. Since there has also been a substantial delay in delivering the monetary