It was Nepal’s misfortune that all the expensive preparations for Visit Nepal 2020, during which the country hoped to attract a record 2 million visitors, have gone to waste because of the Covid-19 crisis.
For five months now, regular international domestic flights have been grounded. Kathmandu airport is scheduled to reopen for limited regular flights next week, but may not be fully operational at least till early next year. Trekking trails are all empty and there were no crowds on the south side of Mt Everest this spring.
Nepal’s tourism industry is on the brink of collapse. Some restaurants and bars that opened after the 21 July easing are closed again. Some hotels are getting business from being turned into quarantine centres, but trekking and mountaineering agencies, airlines, tourist bus companies, cable car operators, safari resorts, handicraft vendors are all on the brink of collapse.
“Hotels have been very badly hit, and business is expected to shrink from 7.33% growth to a startling negative 16.3% decline in 2019/2020,” says Shreejana Rana, president of the Hotel Association of Nepal (HAN). Most hotels are keeping staff with reduced pay, but 25% of employees have been laid off.
With more than $700 million in annual earnings, tourism makes up an equivalent of 8% of Nepal’s GDP. It employs 500,000 people directly just in trekking and mountaineering, with 2 million others benefiting from tourism indirectly. For the government, there is a loss of revenue from taxes, mountain climbing fees, and national parks have lost income they used to plough into conservation work.
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Nepal’s domestic airlines used to charge foreigners higher ‘dollar fares’ than locals, and it made up to 40% of the revenue for airlines like Tara Air with which they used to subsidise Nepalis flying to remote areas. The Tourism Ministry announced this week that it was scrapping the two-tier fares, enraging airline operators who are already reeling from the five-month lockdown.
Yankila Sherpa, former Minister of Tourism and Civil Aviation, is now managing director of Snow Leopard Trek which specialises in high-value treks for 300 clients per year from the US, Europe and Southeast Asia. “We have had to lay off all our field staff,” Sherpa says.