Nepal as a destination has remained almost static from the perspective of developing activities and introducing new itinerary as product development has been a great limitation during these past decades. Per capita spending of tourist in the country, virtually, also remained very low during all those decades due to absence of capability among Nepali travel operators to access consumer market directly.
By Prachanda Man Shrestha
Tourism is considered as one of most prospective sectors for the economy of the country. It is more so because of the need to compensate growing deficit in goods trade with other countries, ever increasing need of economic use of existing natural and cultural heritage for its sustenance, and alarming need for creating alternative employment opportunity both in rural and urban areas of the country. Periodical national development plans of the country are seen specifying its development objectives, and programs in the past. However, there are many aspects of tourism development and management which are further to be clearly established in the context of changing national and global perspective.
With the political change of 1950, country became open to foreign visitors. The global community with special interest of exploration, research, and adventure in the Nepal Himalayas were bound to approach during the decade from Nepali side as the northern side of Himalayas lying in the Tibet became closed to foreigners due to political change in China. All the eight thousand meter peaks of Nepal Himalayas, including the tallest Mt Everest, were successfully climbed during the decade. Success stories were massively covered by the media in tourist generating market which established Nepal as a country of natural beauty on the serenity of Himalayan range. Destination image of Nepal as Shangri-la in the generating market happened to be the base of Nepali tourism.
Growing interest toward Nepal as a pristine destination drew attention of the Nepali government to get benefit from the international tourist arrivals. First initiation was the establishment of a Tourist Office in 1957 under the Ministry of Industry and Commerce which was later converted into a full-fledged Department of Tourism in 1961.
Kathmandu, the capital city, was offered in the tour itinerary with full day and half day city sightseeing on the basis of a report prepared by French Advisor named George Lebrec who drafted first tourism development plan on the country. Department of Tourism got involved in identifying vantage points for the spots and sites coordinating with government agencies for physical infrastructures along with incentives to mobilize investment of private entrepreneurs for facilities.
High-level Nepal Tourism Development Committee was formed in 1969 with representation from both government agencies and tourism entrepreneurs for the longer term sector development perspective in tourism of the country. Hotel Management and Tourism Training Center was established in 1972 as per the tripartite agreement between the government, UNDP and ILO realizing the need for trained human resources for the growth of hospitality industry.
Similarly, with technical assistance of Federal Republic of Germany, first Nepal Tourism Master Plan was formulated in the same year which was reviewed in 1984. As recommended by the Plan, a separate Ministry of Tourism was formed in 1977.
For the effective coordination among different public agencies to have synchronized development policy environment along with private business operators for efficient tourism facilities, Tourism Coordination Committee under the chairmanship of Tourism Minister started to function from the year 1978. Also realizing the significant role of air transportation for access to the destinations, Department of Civil Aviation was brought under the Ministry of Tourism in the year 1982 along with the national carrier Nepal Airlines Corporation (NAC). In the year 1991, the coordination committee was expanded into a Tourism Council under the chairmanship of Prime Minster to achieve further effectivity in multi-agency coordination which all the time posed a great challenge for the development of tourism due to its multi-faceted nature and need for integrated approach in development.
New course of tourism development was set with the formulation of Tourism Policy 1995. The policy clearly established the sectoral objectives of tourism development to support balance of payment, area development, creating infrastructures, and alternative opportunities of employment extending from urban to rural areas, and economic utilization of existing natural and cultural heritage which was otherwise remaining economically wasted. For further institutionalization of public private partnership, creating positive synergy in development policy and program of tourism, a novel structure of Nepal Tourism Board was created in the year 1997 which in reality started to function from the year 1999. Nepal Tourism Board established as an independent agency with private sector domination got engaged basically in destination promotion programs in the generating market with industry representation. Tourism-related policy was further reviewed in 2008 with wider consultation process. Direction of tourism was intended to be more inclusive in this policy paper considering the changing national context. However, product development in the sector remained lagging behind due to constraints of physical infrastructures, instability in the country, and changing national system of regime.
Status of Nepali Tourism:
Development of tourism in Nepal is mostly seen measured by three indicators – number of arrivals, per capita per day spending, and length of stay of tourists. Length of stay of tourists in Nepal has stayed in the range of 9 to 14 days since the very beginning of tourism in Nepal. Length of stay is determined by the type of tour itinerary and packages offered by the industry and the activities developed in the destination. It clearly indicates that Nepal as a destination has remained almost static from the perspective of developing activities and introducing new itinerary as product development has been a great limitation during these past decades. Per capita spending of tourist in the country, virtually, also remained very low during all those decades due to absence of capability among Nepali travel operators to access consumer market directly. Even due to absence of separate system to capture effectively the spending of tourist in the national accounting process, tourist spending could not be reflected in real terms. Official figure of the tourist spending always remained lower than real which could never cross the mark of US$ 100 per tourist per day, and during certain period even went much more lower because of the policy orientation in spreading tourism activities more toward deprived areas involving local participation with low capacity of providing standardized services. However, the arrival figure of the international tourist remained consistently growing though there had been periodical set back with reason of international and national situations.
It is very interesting to note the steeper growth on arrivals on above chart seen during the year 1994 to 1999, and 2007 to 2013. The focused concentration of the then Department of Tourism as national tourism organization on disseminating message of Nepal as a must visit place in the generating market, announcement of Visit Nepal Year campaign in 1998, confidence building action among operators of generating market joining hands with Nepali tourism industry by Nepal Tourism Board, and announcement of the year 2011 as a national campaign of tourism can be given due credit for the successful growth in generating visitors in that specific period. It has well demonstrated that effective leadership of National Tourism Organization in driving the message of Nepal as a destination in generating market can easily create repulse in Nepalese tourism with those of our own past experience. The set-back on arrival due to any reason whether it may be recession, natural disaster, or conflict, National Tourism Organization can lead in re-establishing confidence among the industry stakeholders to get back industry on track. Present context of negative impact faced by tourism industry due to great earthquake followed by constraint on supply line to the national economy, can easily be overcome by garnering multi-agency support by Nepal Tourism Board as a national tourism organization as in the past.
Nepal, being a landlocked country, international air accessibility is always remaining critical for tourism to grow. At present almost 30 online airlines are providing air connectivity with services of around 3 million air seats per year. However, Air Services Agreements (ASAs) have been signed with 38 countries with estimated provision of around 6 million annual seats. Similarly hotel beds are estimated to have provisions of around 70 thousands countrywide including international star rated standard to lodging facilities in rural areas. But almost over 90% of the available tourist standard beds are concentrated along few popular sites of the country as Kathmandu, Pokhara, Chitwan, Lumbini, Sagarmatha area, and Annapurna area. For ground handling travel services, nearly 4,500 firms are registered as travel or tour, or trekking companies. Those group of industry are mostly relying on their counterpart travel operators based at the market to generate tourists and to sell tourism services of Nepal.
Nepalese tourism industry is seen delinked with destination site owners which is causing absence of new product development in many of the potential sites of the country as well as mismanagement in presenting the existing sites in most professional business way enhancing quality and satisfaction to tourists. It has been very urgent to encourage destination management and development business firms to partner with local development agencies in managing and developing sites for tourism.
As Nepali tourism industry is not in a position to command in market access, particularly at consumer level, collaborating with multi-national tour and travel companies by Nepali firms may provide possibility of addressing this constraint. Giving space to market based travel firms in Nepal is possible by way of joint venture or strategic alliance.
Development and expansion of potential areas for the purpose of tourism destinations within the country is very challenging as state capability in provisioning infrastructures is very limited. Private industry investors may not be willing to take the risk by investing in basic facilities. In this context, identified selected sites with tourism prospects can be offered to business developers through international bidding with clear conditions and terms for longer duration. With such developers, basic infrastructures and facilities will be created along with their own marketing strength. Such sites will be established in the long run as new tourism sites in the country and surrounding host communities will have economic benefit of backward linkage.
(The author is the former CEO of Nepal Tourism Board)