Tourism Industry Losing 25 Billion In Nepal Due To Coronavirus

May 6, 2020 | Investopaper

With the worldwide Corona epidemic, the ‘Visit Nepal Year 2020’ suffered drastically. The year was supposed to attract 2 million tourists i.e. 800,000 more than the previous year. But due to the epidemic, the tourism industry has witnessed a rapid contraction, with an estimated loss over Rs 25 billion.

According to the department of tourism, 2600 trekking agencies are closed. About 20,000 tour and trekking guides are forced to stay indoors. There are no guests in 324 home-stays. 73 rafting agencies have parked their rafts (boats) in warehouses. Fifty-one domestic flights, including seven jets, are stranded in hangars, bringing tourists to Nepal. Thirty-three of the 10 helicopter companies that go on tourist rescue and charter flights have also not found work. This is the main business season for all of them.

“Our research has shown that 272,000 people are unemployed,” says Nepal Tourism Board CEO Dr. Dhananjay Regmi “This is a statistic of 175,000 employees employed in the direct tourism sector and 97,000 people who are involved in the season alone.”

Tourism sector contributes about 80 billion rupees in foreign exchange earnings annually.

The private sector has invested around Rs 1 trillion in the hotel sector. Of which more than half of the investment has come from banks and financial institutions. The loss of business by hotels will also have a negative impact on the income of banks and financial institutions.

Major hotels, including star hotels, are losing Rs 1.80 billion monthly business. Similarly, the aviation industry, which has 21 domestic airlines including helicopters and ships, is losing around Rs 1 billion a month at present.

The current status in the tourism industry is:

– All hotels except one / two out of 129 stars closed

– 26 hundred trekking agencies stopped

– About 20,000 tour and trekking guides unemployed

– There are no guests in 324 homestays

– 73 rafting agencies shut down

– 51 domestic ships, including 7 jets, stalled

– 33 aircraft of 10 helicopter companies are also out of work

Under the tourism sector, tourist arrivals in Nepal have been negative at about 14 percent this year, according to the Department of Statistics. Similarly, the contribution of hotels and restaurants to the GDP will be negative at 16 percent this year, according to the department.

The Tourism Board has suggested the government to set up a fund of Rs. 20 billion to revive the tourism sector from this negative situation. Of this, Rs 10 billion has been requested for airspace and the remaining Rs 10 billion for hotels, travel, trekking and other sectors.

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