

Nepal COVID-19 Monthly Update
May, 2020
TABLE OF CONTENT
 COVID-19 Monthly Update Key highlights Sta-s-cal Update COVID-19 Cases Tes-ng and Procurement Government Orders Relief Measures Economic Update Evacua-on Preven-ve Measures Other Informa-on
Regional StaAsAcs Expert Speak Tourism Sector (Mr. Bijay Amatya) Hospitality Industry (Mr. Pralhad Raj Kunwar) Light Manufacturing Sector (Mr. Dan WiQng) Tourism Sector (Mr. Marcus CoRon) Health Sector (Ms. Megha Chaudhary) Hospitality Industry (Mr. Douglas Maclagan) Tourism Sector (Mr. Pankaj Pradhananga) Pharmaceu-cal Industry (Mr. Vivek Man Vaidya) Tea Industry (Mr. Neeraj Rathi) Hospitality Industry (Mr. Parmita Sakya Shrestha)
InternaAonal PracAces Lessons of adaptability amidst coronavirus from Hong Kong
NEPAL COVID-19 MONTHLY UPDATE | MAY 2020
KEY HIGHLIGHTS •
Nepal witnessed a quick jump of COVID-19 cases from 100 to 1,000 cases within May. Likewise, the first COVID-19 related death was also reported in May.
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The naAonwide lockdown has been extended to 14 June and the ban on internaAonal flights has extended to 30 June.
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The annual federal budget for the fiscal year 2020-21 was announced this month, which primarily focused on employment generaAon, economic recovery, and healthcare.
STATISTICAL UPDATE
Total Tested
Total Cases
Total Recovered
Total Death
April
12,577
59
16
0
May
69,587
1,572
220
8
COVID-19 Cases •
Amongst the cases that were tested posi-ve, the highest numbers of cases, 189 cases, were registered on 30 May.
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Province 2 and Province 5 are the most affected regions of Nepal with each registering 547 cases by 31 May followed by Province 1 with 160 cases, Karnali Province with 61 cases, Bagma- Province with 45 cases, Sudurpaschim Province with 21 cases and Gandaki Province with 20 cases.
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Nepal registered its first COVID-19 related fatality on 16 May. Eight deaths were reported by the end of May with people ranging from the age of 2 years to 70 years.
TesAng and Procurement •
The Ministry of Health and Popula-on was short of Rapid Diagnos-c Test kits in early May as the Nepal Army and other contractors with whom the Ministry had signed a deal to procure medical supplies failed to deliver on -me.
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Nepal’s bilateral partners stepped up to help support Nepal’s response to combat COVID-19. In this context, Germany provided Nepal with 3,000 PCR-Test kits on 2 May. Likewise, the government of another bilateral partner, Switzerland, dispatched 30,000 PCR kits to Nepal on 7 May. Similarly, China handed over 40,000 PCR test kits among other medical equipment and devices to Nepal, and India handed over 30,000 PCR kits to the Government of Nepal on 17 May.
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Around nineteen tonnes of medical supplies imported by the Nepal Army on behalf of the Nepal government arrived in Kathmandu on 18 May from Guangzhou, China. Similarly, the Army brought in consignment including 28,000 PCR kits, personal protec-ve equipment, and 30 portable X-ray machines on 28 May.
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Ministry of Health and Popula-on (MoHP) issued an interim guideline permiQng private and community hospitals to conduct RDTs for COVID-19. Previously, these ins-tu-ons were only permiRed to conduct the PCR tests. Likewise, it also decided that ci-zens, as well as foreigners, could now pay and do PCR/RDT tests for COVID-19 even without any signs or symptoms.
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The Supreme Court issued a writ pe--on to the government to increase the tes-ng of coronavirus infec-on through PCR in light of the increasing number of cases across the na-on.
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Members of the federal parliament as well as the provincial parliament of Gandaki and Karnali were tested for COVID-19 in the light of budget prepara-ons. None of them tested posi-ve.
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The Epidemiology and Disease Control Division started training over 2,000 health workers to conduct contact tracing as MoHP officials expect COVID-19 cases to rise swihly over 20,000 soon.
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As Province 5 became the hotspot for COVID-19 cases, the provincial government decided to use its police and army hospitals for the treatment of COVID-19 pa-ents.
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The Legisla-ve Management CommiRee of the Na-onal Assembly directed the government to get at least one person from all families tested for the COVID-19. Along with this, the commiRee also directed the government to equip all provincial and local levels with the necessary health equipment, manage relief distribu-on, and drah a unified law concerning the health sector.
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Thirty-eight people including doctors, nurses, and pa-ents were quaran-ned at Tribhuvan University’s Teaching Hospital aher a 6-year old pa-ent seeking ENT treatment was tested posi-ve for COVID-19.
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Sellers, producers, loaders, and drivers engaged in trading agro-products at Kalima-’s “Fresh fruits and vegetables market” were tested for the COVID-19.
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The Government of Karnali Province used helicopters to collect swab samples of COVID-19 from various places of Humla and Mugu ci-ng reasons for physical remoteness.
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Rap- Academy of Health Sciences, which is the first medical college established in Province 5, will hereon be involved in the treatment of COVID-19 pa-ents. Previously, the Academy was only tes-ng COVID-19 samples. Similarly, in Province 2 Gandak COVID Specialty Hospital located at Birgunj commenced its opera-ons from 21 May to treat the increasing number of COVID-19 pa-ents.
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Nabil Bank provided NPR 2.82 million to Karnali Provincial Hospital to establish PCR machines in their premises.
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Everest Parenterals Private Limited, Bara started the trial produc-on of viral transport medium kits, which is required to transport collected swabs to the laboratory for tests. The kits are sent for third party trials. Once approved, the company can produce about 15,000 kits a day.
Government Orders •
The na-onwide lockdown that began on 24 March has been extended un-l 14 June. The lockdown was extended thrice in May; first by 10 ten days on 6 May, second by 15 days on 17 May and third on 31 May by 14 days. Likewise, the ban on interna-onal flights has been extended to 30 June in a similar phase-wise extension.
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Addressing the na-on on 25 May, Prime Minister KP Sharma Oli said that the spread of the coronavirus in the na-on was due to the failure of tes-ng the Nepali returnees from India, and thus, urged the returnees to get their tests done in -me. Addi-onally, he also stressed that the government will rescue Nepali ci-zens living abroad.
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Ministry of Home Affairs decided to cancel the validity of travel passes for all intra-district movements with effect from 16 May. The Ministry also made it compulsory for everyone to produce his or her rapid diagnos-c test results to enter the capital city in the view of rising COVID-19 outbreak inside the valley.
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The Ministry of Educa-on, Science, and Technology instructed schools across the na-on not to enroll new students or charge any fees to the exis-ng ones in the light of schools being shut.
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The District Crisis Management Centre in Parsa directed security personnel to open fire at coronavirus pa-ents if they try to leave the isola-on ward at coronavirus hospitals.
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Aher the High-Level Coordina-ng CommiRee’s decision, the Nepal government is set to allow people who came from Japan and Hong Kong for a holiday to go back.
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All privilege passes issued at the beginning of the lockdown were revoked on May 14 and new passes were issued by local administra-ons. However, under the new provisions, businesses that apply for passes to move vehicles during the lockdown are required to provide tax clearance cer-ficates and recommenda-ons from agencies.
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The Government of Nepal decided to halt regular schedules of staff recruitment in the public sector, except for emergency cases, un-l further no-ce.
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The government decided to use hotels and resorts as quaran-ne facili-es for the people who will be brought from abroad. However, the Hotel Associa-on of Nepal has demanded at least NPR 3,000 for each person per day, if their proper-es are used as quaran-ne facili-es.
Relief Measures •
The budget for FY 2020/21 has men-oned about various relief packages, including for people who have lost their jobs due to the COVID-19 pandemic.
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The government announced that rescheduling of loans and classifica-on of loans, for loans taken from banks and financial ins-tu-ons, will remain the same. However, the NPR 60 billion refinancing funds will now be made an NPR 100 billion funds, and the interest rates, for loans provided through it, will be lowered.
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The Interna-onal Monetary Fund approved USD 214 million as a disbursement to Nepal under the Rapid Credit Facility to address the immediate external and fiscal financing needs that have emerged due to COVID-19.
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Asian Development Bank is providing a USD 250 million concessional loans to Nepal to increase its tes-ng capacity, set-up quaran-ne facili-es, and support social protec-on programs such as subsidized lending to affected small and medium businesses.
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A mee-ng of the execu-ve body of Dhangadi Sub-Metropolitan City brought a policy of providing work to its daily wage earners instead of distribu-ng relief materials.
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Nepal Oil Corpora-on announced to provide health insurance worth NPR 100,000 to its employees in case they contract COVID-19.
Economic Updates •
The government announced a health budget of NPR 90.96 billion (a 32 percent increase from the previous fiscal year) in the new annual budget for FY 2020/21, out of which NPR 6 billion has been allocated for the preven-on and treatment of COVID-19.
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The government has started prepara-ons to establish a labor bank in its bid to address job losses caused by the global COVID-19 crisis. The bank could employ around two million workers in partnership with the private sector.
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The government has decided to merge the management of two of the state-owned cement industries – Hetauda Cement Industries and Udayapur Cement Industries to curb opera-onal costs.
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Since the onset of lockdown, Nepal imported packaged medicines worth NPR 2.7 billion and NPR 0.6 billion worth of raw materials for producing medicines. Likewise, from the first week of lockdown to the eight weeks, the import of food items surged by 82.6 percent, pulses and legumes by 121.1 percent, fruits by 305 percent, dairy products by 132.9 percent, and vegetables by 9.6 percent.
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The Tribhuvan Interna-onal Airport in Kathmandu has started prepara-ons to resume its opera-ons in June. They will be adop-ng social distancing measures to minimize the risks. Meanwhile, the Civil Avia-on Authority of Nepal and individual airline companies are also preparing to issue their guidelines to promote safety aher the flight resump-on.
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Cargoes are being piled up at the Sirsiya Dry Port in Birgunj, as importers are unwilling to clear their cargoes ci-ng reasons for unavailability of trucks and low consumer demand. Consequently, the port is opera-ng at three -mes its capacity.
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Nepal’s stock market - NEPSE resumed its opera-ons from 12 May, aher a halt of 50 days.
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Banks all over Nepal made new arrangements to digi-ze remiRance processing. This arrangement will replace the requirement of recipients to visit banks with documents. Instead, they can submit their proof of iden-ty (code number/iden-ty documents) electronically. Upon verifica-on, the bank shall transfer the money into the recipients’ bank account.
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Nepal government signed an MoU with the Asian Infrastructure Investment Bank where the laRer will provide loans worth NPR 13.7 billion for implemen-ng the government’s plan on upgrading and expanding Nepal’s electricity distribu-on system.
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Nepal Insurance Board ordered insurance companies to provide discounts on premiums of vehicle insurance star-ng from March 24 un-l the lockdown ends. Approximately 1.5 million vehicles are insured each year in Nepal.
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Dairy Development Corpora-on’s Biratnagar Milk Supply Scheme halted the payment of more than NPR 100 million of around 11,000 farmers in the Eastern region ci-ng reasons for a decline in the sales of milk products.
EvacuaAon •
The government is considering repatria-ng Nepali workers stranded in COVID-19 affected countries. Those in urgent need to return home will be priori-zed in the first phase. The COVID-19 Crisis Management Centre has been assigned to manage Nepalis returning to Nepal from various foreign des-na-ons.
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Nepal Associa-on of Foreign Employment Agencies announced that at least 500,000 to 600,000 migrant workers have expressed their desire to return to Nepal aher losing their jobs abroad. Nearly 3,500 Nepali workers in Kuwait alone, who had been working and living undocumented, have submiRed their applica-ons to the host government seeking repatria-on.
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As many as 343 homebound Nepalis are stranded in no-man’s land along the Nepal-India border in Kapilvastu, as they were denied entry into the country. Due to the lockdown, the Armed Police Force security personnel stopped them from entering the country. Likewise, over 1,000 Nepalis are wai-ng at the border town of Belahiya in India to cross over to Nepal.
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The Na-onal Human Rights Commission asked the government to make arrangements of quaran-ne and isola-on facili-es as per the World Health Organiza-on standard and rescue the ci-zens stranded at various Nepal-India border points.
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Government authori-es brought home around 1,300 Nepalis stranded in Dharchula, the bordering Indian town across the Mahakali River.
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Prepara-ons are being made to bring approximately 500 Nepalis placed under isola-on at the Nautanawa area at Indo-Nepal border in Province 5. These people will be placed in quaran-ne centers at Siddharthanagar and TiloRama municipality.
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About 350 Nepalis who were living in quaran-ne facili-es in India post-lockdown entered through the Raxaul-Birgunj border point.
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As per the agreement between the security forces of both India and Nepal, 687 Nepalis were brought to Nepal and 1,483 Indians were sent to India through the Nepalgunj border.
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A Nepal Airlines chartered flight flew to Narita, Japan on 15 May carrying Japanese ci-zens along with Nepali students and workers who have goRen their entry permits.
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Three hundred nine ci-zens from 54 different na-ons flew out of TIA in Qatar Airways des-ned to Paris via Doha on 2 May.
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276 Australian passengers and 5 passengers from New Zealand were evacuated through a NAC plane chartered by Australian Embassy Nepal.
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For the first -me since the onset of the lockdown, the Government of India chartered a flight and evacuated 165 Indian na-onals on 20 May.
PrevenAve Measures •
Aher the country reported a surge in cases in May, mul-ple ci-es and areas were sealed.
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With an increasing number of posi-ve cases, the Banke District Administra-on Office decided to impose a curfew in Nepalgunj sub-metropolitan city, from 11 am Tuesday 5 May un-l 14 May Thursday-midnight.
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A mee-ng of Karnali Province Disaster Management Council decided to seal all the entry points of the province for a week effec-ve from 5 May.
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Twenty-six Nepalis who entered Nepal from India amidst the ongoing lockdown were sent back to India.
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Makawanpur District COVID-19 Preven-on Command Post decided to stop the movement of people and vehicles to Hetauda through Churiyamai transit point aher the increase in the reported cases of COVID-19 in Province-2.
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Amidst the growing risk of COVID-19 spread, the district of Sindhupalchowk prohibited the import of fruits and vegetables from outside districts.
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Chandragiri Municipality was sealed un-l 19 May to stop the spread of the virus aher four cases were confirmed in the municipality.
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A mee-ng of the District Security CommiRee of Banke on 18 May declared Narainapur as a highrisk zone and decided to seal off the area un-l further no-ce.
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To prevent the spread of COVID-19, the Godawari Municipality in Lalitpur banned the buying and selling of fruits and vegetables coming from Kalima-, Baneshwor, and Balkhu.
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Something done extensively in other countries, hotels in Nepal are to be used to quaran-ne healthcare workers.
Other InformaAon •
The Nepal police arrested individuals who were involved in selling drugs and alcohol in the name of transpor-ng essen-al goods from different areas in Morang. Besides these, in Province 1, police seized over 2,800 vehicles and penalized 1,523 individuals on the charge of defying the lockdown un-l date.
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Nepal Tourism Board proposed the establishment of the Nepal-India tourism task force to jointly work together and tackle issues in the tourism sector that is plaguing both the countries due to the pandemic.
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19 Indian na-onals were detained in MahoRari because of trying to cross the border by defying the lockdown restric-ons.
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Police opened two rounds of blank fire at the border region of Jhapa district to drive away people from across the border who were trying to crowd in defiance of the lockdown, on 4 May.
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Armed Police Force’s personnel posted at Suwarna Municipality-3 of Bara launched a round of open fire in the air aher Indian ci-zens were found allegedly crossing the Nepal-India border despite the lockdown restric-ons. The force took the step aher the Indian ci-zens tried to destroy a security post at the municipality.
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Six Chinese na-onals were injured aher they clashed with the Nepal police demanding to allow them to go back to their home country. Around 38 Chinese na-onals had been taken into custody on 8 May.
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Twenty-six people, who were quaran-ned at Kwholasothar Rural Municipality in Lamjung, have been repairing the public playground of Laligurans Yuba Club as an indica-on of doing something produc-ve in the area.
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Two pa-ents, admiRed in an isola-on ward of Narayani Hospital in Birgunj, escaped the health facility.
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Gandaki provincial government reported that out of 353 individuals who were sheltered in quaran-ne facili-es (since the beginning of the lockdown) only 23 people remain un-l date as most of the suspected individuals fled away fearing to contract the disease.
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Hospitals in Province 5 that were turned into COVID-19 care centers were reported to lack medical equipment, protec-ve gear, and medical workers.
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Dhulikhel Hospital was sealed off aher the death of a pa-ent infected with COVID-19.
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Hundreds of Nepali migrant workers in the United Arab Emirates have gone on strikes and protested against their employers for not giving them work and not clearing their dues for the last two months.
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Ma-hani Municipality in MahoRari temporarily placed bamboo fences by inves-ng NPR 200,000, along the border that it shares with Madhwapur bazaar in Bihar, India to stop the cross-border movement of people.
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A district commiRee in Jumla handed over the responsibility of supervision of the district-level quaran-ne established in Karnali Technical School to the Nepal Army.
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The Minister for Health and Popula-on Bhanubhakta Dhakal was home quaran-ned aher coming in contact with a COVID-19 infected pa-ent.
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The Supreme Court of Nepal provided an interim order to the Nepal Government to keep veterinary service under urgent services.
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114 people have commiRed suicide in Sudurpaschim Province during the lockdown period.
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More returnees from India are running away from quaran-ne facili-es ci-ng mismanaged and overcrowded quaran-ne centers, and long queues for PCR tes-ng.
Regional Statistics
Total cases in the region* 318,803
*As of 31 May 2020
Expert Speak Insights from industry expert and pracAAoners to understand their perspecAve on the impact of the COVID-19 pandemic on their respecAve industry.
Expert Speak: Tourism Sector
The ongoing pandemic has caused severe crisis in the economy around the globe and the tourism sector has not been spared. As an important part of the Nepalese economy with a contribu-on of about 8% to the na-on’s GDP in the year 2018, the current pandemic has created a disastrous situa-on for the tourism sector. As the pandemic con-nues and the lockdown prolongs in Nepal, the sector con-nues to suffer acutely with no sight of relief any-me soon. To understand the ongoing crisis in the tourism sector owing to the current pandemic, NEF sought insights from Mr. Bijaya Amtya, CEO of Kora Tours and prepared a brief insight as below. Impact of COVID-19 pandemic and the lockdown on your business Due to the lockdown, our business at present is zero. We were supposed to have a movement of 250 pax in June; however, all of them have been cancelled. While we have closed our office, we are currently working from home and have managed to keep in contact with all our clients globally. Impact of COVID-19 pandemic and the lockdown on the tourism sector Currently, there are no interna-onal and domes-c flights, due to which the tourism industry looks almost dead. The losses might be over NPR 2-3 billion in terms of monetary value. However, its biggest impact is to the job market as it has wiped out around 1.5 million jobs. Ironically, in Nepal’s tourism industry, the informal sector is bigger than the formal sector. However, many tour/trek companies, restaurants, souvenir shops, etc. will be forced to close down if the government does not come up with proper relief packages for them. The Pacific Asia Travel Associa-on (PATA) has declared that tourism in South Asia will take a dip by around 32% in 2020. With this, Nepal’s tourist inflow is set to be limited to 5-6 lakhs tourists at the maximum; that too if things go well. The future of the tourism sector There are some businesses that might be able to pick-up from as early as mid-September. However, that will just be a trickling effect. Even though October and November might be bit beRer, it might take around 1-2 years for the tourism industry to really pick up its pace. I believe that the year 2020 is gone and that we need to prepare for the year 2021. Nevertheless, there is a big opportunity to move towards sustainable tourism, which can help us give a new shape to our tourism industry. This will also help bring a balance between the numbers and the revenues, as the biggest challenge in the coming days will be to win back the market share being eyed by 197 countries in the global arena. Key areas to be addressed a_er the lockdown Aher the lockdown, we need to make sure that the air pollu-on is brought down. Along with this, we also need to make sure that our airport facili-es are up to the mark and that cleanliness is given a top priority in all touris-c points. Ini-ally, the government must encourage domes-c tourism. Then, we can focus on
China and India to get interna-onal tourists. We can do this by making aRrac-ve packages for them. To my knowledge, Chinese tourists will be the ďŹ rst one to come to Nepal, which will be followed by Indian tourists. For this, interna-onal airlines also need to be encouraged to start their schedule ights whereas the na-onal carrier needs to be supported by all means.
The above Expert Speak ediAon is based on the conversaAon with Mr. Bijay Amatya. He is the CEO and Founder of Kora Tours.
Expert Speak: Hospitality Industry
With divine and rich natural beauty, cultural heritage, history and religion, Nepal is considered as one of the most beau-ful countries to visit. Because of this reason, tourism is one of the most important sources of foreign currency in Nepal. This also shows that the hospitality industry is one of the most booming industries in the country. With Visit Nepal Year 2020 campaign at the doors at the beginning of the year 2020, tremendous opportuni-es and posi-ve changes were expected. However, even in the tourist season, the hotel industry has turned upside down due to the COVID-19 pandemic hovering above the country and worldwide. To understand how the hotel industries are doing amidst the pandemic, NEF spoke to Mr. Pralhad Raj Kunwar, the CEO of Hotel Himalaya and prepared a brief excerpt as below. Impact of COVID-19 pandemic and the lockdown on your business and hospitality industry Hotel Himalaya, conveniently located 8 km away from Tribhuvan Interna-onal Airport and only 2 km from the Kathmandu city centre, provides a perfect place for the guests to rest, work or socialize and enjoy the Nepalese hospitality. However, with interna-onal and domes-c travel badly affected by the coronavirus outbreak, Hotel Himalaya has remained closed from 1 April 2020 and will remain closed un-l the business viability is seen to achieve a break-even point. Amidst the outbreak, the occupancy rates of the hotel industry throughout the country have decreased dras-cally and hotels have shut down, which is why tourism will be the worst hit sector. In regards to this, Hotel Himalaya’s philosophy is about surviving un-l year end and then concentra-ng on revival thereaher. Currently, the only interna-onal airport, Tribhuvan Interna-onal Airport, has remained shut and all travels have been banned. Even aher the opening of the airport, Hotel Himalaya stressed that the business will not flow instantly. Nothing will flow from Europe and America since travel agents have not made any brochure for this year. Travellers themselves might be taking precau-onary measures to avoid overseas travel as well. Some low budget tourists may flow from China and India aher a few months provided the airlines offer discounted tariff. Thus, for the survival and revival of this sector, the government needs to provide waive-offs, subsidiary and discounts. Moreover, since payroll is the highest expense in the hotel industry, the old hotels will suffer the most. As it is currently, Kathmandu has surplus hotels. The compe--on will, thus, be fierce in future. Some hotels may even close down like it did during the Maoist insurgency period. With all of these hiQng the industry to its worst, tourism will take -me to bounce back unlike other manufacturing industries and factories. Given this, Mr. Kunwar believes that there are huge challenges to overcome yet very liRle opportuni-es for the industry un-l the end of 2022. Key areas to be addressed a_er the lockdown To address and take benefits of the opportuni-es that exist, interna-onal seminars, mee-ngs, conferences, exhibi-ons if promoted can enhance the room and F&B business. For this, the government
should not put restric-ons on the number of aRendees for social func-ons as it is one of the biggest sources of earnings for hotels. Hotels are already cheap in Nepal but airfare is making the des-na-on expensive. Thus, considering this, the government should not charge landing fee, airport tax and provide subsidy on avia-on fuel in order to aRract interna-onal tourists. When all of these will be considered, the revival of the hotel industry can be expected post COVID-19 pandemic.
The above Expert Speak ediAon is based on the conversaAon with Mr. Pralhad Raj Kunwar. He is the CEO of Hotel Himalaya.
Expert Speak: Light Manufacturing Sector
The COVID-19 pandemic has taken a toll on us all and has caused a global problem, with rising number of cases each day and a poten-al threat to every business. Currently, everything has been halted and badly affected all the countries across the world. In this regards, it is no surprise that the pandemic hit hard in Switzerland too. To understand the impact of the current situa-on, how the governments are dealing with it and how the business environment is looking like in Switzerland, NEF spoke to Mr. Dan WiQng, partner of Baabuk Switzerland and prepared a brief excerpt as below: Designed in Switzerland, crahed in Nepal and Portugal, Baabuk is a Swiss brand that has been consistently making felt footwear since 2013. Confinement in Nepal versus Switzerland When Dan first heard about what had started to spread and how the confinement was beginning in Switzerland, he aRributed the confinement as a posi-ve response along with open communica-on from the Swiss government to its ci-zens. During an outbreak as deadly as coronavirus, the steps and leadership taken by the government leads the way for its ci-zens to cope with the situa-on. Thus, he believes that as ci-zens, everybody received a very humane and honest communica-on without the feeling of just another poli-cal ac-on. As there was no sign of the containment of the outbreak any sooner, and as the growing cases worldwide were becoming worrisome, Dan tried to pass the message to their employees in their workshop in Nepal. But, to his surprise, he heard about very liRle cases in Nepal and that the Nepalese government had not much communicated at this stage to prepare the popula-on. The complete lockdown in Nepal is much more severe than in Switzerland knowing that the number of communicated cases was very liRle. Given this, he thinks that the lockdown is a very wise decision for two reasons: •
The medical situa-on in Nepal is below the one in Europe and,
•
The popula-on has to be educated and disciplined to keep social distance.
Role of the government All businesses have been nega-vely affected by the uncontrollable outbreak. Dan, thus, stressed that he would like to see more support from the Nepalese government by releasing funds to support the shutdown business. In his view, ci-zens pay taxes and abide by all the government rules. So, now, it is -me that the government gives back as this is the neediest -me for everyone. Businesses like Baabuk and many thousands of other local business lack resources to keep the local employees paid without work. Without the support from the government, he believes that everyone will run into a global disaster, including themselves.
Contras-ngly, he pointed out that the way the Swiss government helped was in two ways: • •
y suppor-ng technical unemployment with 80 % paid by the government. B By giving a 10 % loan based on yearly revenue for small businesses with 0 % interest rate for 3-5 years.
These are decisions that he hopes will be proposed by the Government of Nepal. ParAng thoughts As concerning and alarming the current situa-on of the COVID-19 pandemic is, it is also a -me for incredible learning. With this, Dan hopes that people learn to be responsible to pay taxes so that the government has enough budget that will further be used for all its ci-zens to rely on when needed.
The above Expert Speak ediAon is wriaen by Mr. Dan Wicng. He is a Partner at Baabuk Switzerland, company that makes handmade felt shoes in Nepal.
Expert Speak: Tourism Sector
Tourism is one of the world’s largest industries and a massive global employer. For Nepal, tourism is an important source of foreign exchange reserve as well as employment with the sector contribu-ng around 8 percent to the na-on’s GDP. However, the recent coronavirus pandemic has pushed the sector to the brink of closure. Since the commencement of the na-onwide lockdown and other travel restric-ons, the opera-ng margin for the sector has dras-cally reduced. In this backdrop, to understand the impact and predict the possible future for the sector post the pandemic, NEF reached out to Mr. Marcus CoRon, Managing Director at Tiger Mountain (P) Ltd. to gain more insights and prepared a brief summary as below. Impact on the tourism sector The impact of the pandemic on all business ac-vi-es and sub-segments within the tourism sector has been massive. The global nature of the pandemic coupled with limited knowledge of the virus is further exacerba-ng severe repercussions on the domes-c economy. In a realis-c assessment, there will be liRle to no interna-onal travel in 2020 as the pandemic is far more severe than any other na-onal adversi-es of the past. Thus the industry will lose a year’s business. Few companies globally are designed to operate or survive such circumstances. That said, Nepal has had many adversi-es in the past and any well-established business that has hollowed out its balance sheet or borrowed excessively and failed to retain significant reserves has made a grave error of judgement. Tiger Mountain intervenAon Tiger Mountain is closed in line with government orders and has 33% staff on duty for maintenance, training – the major focus being on re-opening and new protocols for hygiene and health, security and fire piquet du-es. All are kept in isola-on from the community and vice versa. The rest are on leave or working from home. Having seen the past poli-cal and social disrup-ons that emergencies have on cash flow, our company maintains strong cash reserves which enable us to keep all our staff on full pay for an ini-al six months (i.e. Chaitra to Asadh). Our back office systems were designed to be resilient both in support of the New Zealand Consulate hosted in our Kathmandu Office and due to the semi-remote nature of our property; this has worked well – we have done many drills for just this sort of eventuality, but hardly expected a viral pandemic to trigger opera-ons ‘for real.’ Way ahead The global pandemic comes at a vital -me for Nepal’s tourism sector. The pause is actually a blessing in disguise for the industry to introspect, think, recalibrate and assess why tourism? what tourism? how tourism? For too long the country has not taken stock of the tourism poten-als, pixalls and approaches. This is a God-given -me where we can lih sustainability from a niche to the heart of the industry. The days of lip-service and greenwashing are over.
Since interna-onal, especially long-haul and mul--point, travel is going to be negligible in 2020 we must focus on domes-c and immediate region tourism. This means Nepal, China and India principally; two vast markets with point to point air access and Nepal’s domes-c market has grown significantly in recent years. Similarly, drahing prac-cal, eco-friendly, and appropriate standards and guidelines for industries will also be needed in the post crisis period. The government has limited ability to offer bailouts or similar financial incen-ves. However, allowing greater flexibility for interest payments, tax submissions and other repor-ng dates could assist. Moreover, merging the current and next fiscal years is a possible op-on for the government to consider. Business must stand on its own feet and stand tall – shareholders need now to inject capital rather than extract it and to protect their employees. It is -me also for Nepal to take fully on board that the tourism industry is global and Nepal competes on a global stage – will we really be ready when travel regenerates?
The above Expert Speak ediAon is wriaen by Mr. Marcus Coaon. He is the Managing Director at Tiger Mountain (P) Ltd.
Expert Speak: Health Sector
To understand the impact of COVID-19 on the health sector, par-cularly on hospitals, NEF sought perspec-ve from Megha Chaudhary, Managing Director, Norvic Interna-onal Hospital and prepared a brief excerpt as follows. Impact of COVID-19 pandemic and the lockdown on hospitals in Nepal The COVID crisis affec-ng the world today requires a level of response that goes beyond the capacity of any country. The Government of Nepal is puQng in place a series of measures to address the situa-on, but more needs to be done, and interna-onal solidarity is required to ensure that the country is fully prepared to face the pandemic and address its impact in all sectors. Hospitals are experiencing a reduc-on of in-person hospital visits due to lockdown and fear of COVID-19 transmission. But the major factor affec-ng us is the halt on elec-ve procedures and surgeries because of the government’s instruc-ons and lack of PCR tes-ng facili-es. Surgeries have been reduced by approximately 90 % na-onwide. Hospital’s revenue from elec-ve procedures and surgeries are usually higher than revenue from the emergency rooms services, so the financial impact has another long term factor disabling the hospitals for new investments in new technologies in the health care sector. Due to prolonged lockdown, availability of necessary consumables and accessories is another major issue which has to be imported from 3rd country. As private hospitals contribute nearly 2% of na-onal GDP, there is a great impact because of this pandemic. As this pandemic has exposed the challenges to the health sector globally, steps that could be taken in Nepal to improve preparedness in the future: • Coordina-on, Planning and monitoring. Establishing an incident management team including rapid deployment of designated staff from na-onal and partner organiza-ons, within relevant Emergency Opera-ons Centres (EOCs). •
Preparedness and response planning to opera-onalize the strategic preparedness and response plan at country level;
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Conduct regular opera-onal reviews to assess implementa-on success and epidemiological situa-on and adjust opera-onal plans as necessary.
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Raising awareness and dissemina-ng technical guidance (in all levels)
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Business con-nuity planning for exis-ng humanitarian ac-on.
Ways private hospitals in Nepal can provide support to the government as the lockdown eases: • Private and public hospital systems should have a joint-partnership to fight the COVID-19 pandemic.
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Such partnership can give us the capacity to respond to COVID-19 now, and the ability to preserve our hospital network for our na-on’s health once we emerge from the crisis.
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Accommoda-on for quaran-ne and isola-on cases where necessary, and safety procedures and training in different places.
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Availability to address the large surgical backlog that will need to be addressed when the pandemic is over.
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Sharing of available healthcare resources like ICU Beds, Ven-lators, Monitors etc.
The new world post COVID-19 will be different- some things that hospitals could do to get back to their daily operaAons ensuring safety for all • Tes-ng and caring for pa-ents with confirmed or suspected infec-on and keeping the staff safe. •
Prac-sing specific WHO/Government guidelines regarding preven-ve measures against COVID-19 infec-on spread.
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Digital Health System and Ar-ficial Intelligence applica-on in the healthcare sector
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Devices like digital stethoscopes, portable ECG monitors and digital otoscopes can be used at home and the results can be shared remotely with doctors.
As Nepal does not have state supported health programs nor wide coverage of health insurances, steps that the health sector stakeholders (Govt, Hospitals, Insurance Cos, Banks) could take to roll out the health sector reform program • A na-onwide survey needs to be conducted and the vulnerable popula-on need to be iden-fied (children, elderly, immunocompromised, differently abled etc.) •
eveloping Health Insurance Program addressing equitable access with a view to improving health D outcomes.
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aximum number of pa-ents and people need to be enrolled into the health insurance program M at the ini-a-ve of the government.
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Policy needs to be made by the government regarding subsidies and fast tracking of the process involving all stakeholders like Private Hospitals, Public Hospital, Insurance Companies etc.
The above Expert Speak ediAon is wriaen by Ms. Megha Chaudhary. She is the Managing Director of Norvic InternaAonal Hospital.
Expert Speak: Hospitality Industry
The coronavirus pandemic has had devasta-ng effects on the global economy. The travel and hospitality industry has been hard hit due to the virus outbreak as hotels and restaurants have been increasingly closing down and laying off their staff to ensure the marginal opera-on of their businesses. In this backdrop, NEF reached out to Mr. Douglas Maclagan, Pavilions Himalayas for his perspec-ve on the impacts of the virus outbreak on the hospitality sector and prepared a brief summary as below. Pavilions Himalayas operaAons Pavilions Himalayas has completely closed its opera-ons as per the government’s enforcement of the na-onwide lockdown. With the only interna-onal airport being shut, we have a negligible number of foreign visitors. However, we have been very sincere to our team members and have given them twomonth no-ce in terms of keeping their salaries safe. We currently have thirteen staff (one member from each department) on board to keep our hotel alive in terms of maintenance and to cater to the local market. The rest of our staff are on unpaid leave and have been understanding and suppor-ve of this move. Changing the percepAon of travel Travel is never going to be the same again as this is not a na-onal or a regional crisis; this is a global crisis. People are also going to see travel in a different light. Big groups and places with huge popula-on will be sidetracked or avoided. Similarly, air travel has dras-cally reduced. Hence, while it is going to be very difficult for ci-es such as London, Rome, Kathmandu, and Pokhara to bounce back to their previous glory, travel involving nature, hiking, and trekking are expected to experience a faster recovery as this mode of travel involves social distancing. It is going to be a slow recovery and can take at least 3-5 years before we can see any return to the normal situa-on like in 2019. Challenges and opportuniAes for the tourism sector In terms of tourism, countries will eventually have to open up their doors for interna-onal arrivals. For Nepal, since the recovery of European na-ons, which are the major source of tourism to Nepal, is going to be very slow, so in the near future, we have to concentrate more on local and regional tourism. Nepal is a beau-ful na-on with healthy tourism prospects in the form of yoga, medita-on, organic foods, adventure, and nature travels. Thus, the na-on could focus on enhancing and promo-ng its natural beauty, culture, and tradi-ons to aRract more tourists from neighbouring na-ons like India, China, Bhutan, etc. However, aRrac-ng tourists from European na-ons is going to be challenging. Similarly, another major challenge lies in the future tourism job market. PotenAal consequences Direct employment of individuals who need jobs is going to be heavily impacted as the sector is currently considering downsizing and layoffs. Unfortunately, many people who have been geared up and trained in
this sector are going to lose jobs. The household economy is going to be largely impacted and people might have to consider returning to their homes. Way ahead For Nepal, ďŹ rst the lockdown has to end so that people can move, and the interna-onal airport can operate again. The coronavirus is not a momentary disease; it is going to stay over our economies for the long haul. The virus is more serious, stubborn, and deadly than any other disease that we have seen before. Considering this, we must come up with new and safe ways to deal with it. Opening up the na-on is going to be a challenge (both economically and socially). However, Nepal is a country where people are extremely peaceful and resilient. We picked ourselves up aher the earthquake. Therefore, there is real scope for reviving our economy, but this will come at some cost.
The above Expert Speak ediAon is wriaen by Mr. Douglas Maclagan. He is the Proprietor of Pavilions Himalayas.
Expert Speak: Tourism Sector
Bestowed with incredible natural scenery and rich cultural heritage, Nepal is considered as one of the most important countries to visit. Given this, tourism is one of the significant sources of income for the country contribu-ng largely to its revenue and foreign currency. Travel and tours sector is, thus, one of the most important sectors for Nepal with the ability to boost its economic growth. However, due to the coronavirus outbreak and the na-on-wide lockdown into effect, this sector has experienced a downfall. To understand how the travel and tours sector is doing amidst the pandemic, NEF spoke to Pankaj Pradhananga, Director of Four Season Travel and Tour and prepared a brief excerpt as below. State of business operaAons COVID-19 has caused a plunge in the travel and tours sector, and impacted it in an unprecedented way. In the past, there has never been a situa-on with zero clients for over two months. Since the company does not have inbound clients travelling with them, and since it is highly unlikely that it will rebound in a month or two, the business opera-ons have completely shut off. The team members are staying home and complying with the lockdown. The potenAal impact of COVID-19 on the travel and tours sector Tourism is one of the most important economic ac-vi-es for Nepal. But with the pandemic hovering above us all and throughout the world, the global tourism industry is going to witness a huge shih in the way it has been opera-ng in the past decades. In Nepal, tourism has enjoyed organic growth in the last 65 years. Nepal has been selling adventure, culture and nature. Now, it will be a high -me to reinvent with our products. In the coming months, interna-onal travellers will be extremely cau-ous about hygiene and physical distancing. Considering this, it should be ensured that the tourism opera-ng sectors (such as airlines, hotels, restaurants, and travel and trek operators) follow the standard opera-ng procedures religiously once the lockdown is over. Building back confidence among the travellers will be a daun-ng task as the opera-ng cost is bound to rise further due to physical distancing measures. This will result in a significant drop in the arrival of tourists to Nepal, as the des-na-ons all over the world will put their best efforts to get the maximum share from the global tourism market. This will result in tourism businesses to shih the focus to domes-c and regional markets like India and China. OpportuniAes and challenges for the travel and tours sector If we look at the tourism sector locally and globally, it has grown significantly in the last three decades. As per UNWTO, the Interna-onal Tourists Arrivals in the world was a liRle over 0.5 billion in 1995. In over 24 years, the tourist arrival numbers have crossed a 1.4 billion mark as of 2019. Needless to say, there were a series of global challenges in the forms of regional war, 9/11, SARS and economic meltdown. Despite these challenges, tourism bounced forward and recorded steady growth. Likewise, though the challenges of COVID-19 are unprecedented currently, I feel that people cannot lock themselves inside for a very long period.
Travel is considered as a necessity in developed countries. Though people will take -me to pack their bags and take flights for long haul trips, they will start exploring domes-cally as well as in nearby des-na-ons without having to fly for hours. In the context of Nepal, it will see the return of allocentric travellers who visit for adventure. Likewise, there is a possibility that special interest segments like spiritual tourism may put Nepal in their bucket list as well. Travellers will seek for an opportunity to experience the wellness of mind and body with a dash of inner explora-on. Key areas to be addressed immediately Some of the key areas that need to be addressed immediately for the sector to pick up momentum in the coming months are: •
S ustainable and sensible communicaAon: Our marke-ng communica-on should have a message of empathy and compassion. Many des-na-ons are engaging their customers and prospects with communica-on. It is beRer to send the message to take care and stay safe as no one would dream of a holiday in such a desperate situa-on. Hence, it is more suitable to share good wishes and posi-ve vibes and help target travellers to remain calm and serene. Sharing lihing stories from Nepal and life-changing trips taken by many in the Himalaya would be more appropriate now.
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T raining/capacity building: When the workforce is staying idle, it is beRer to engage them in capacity building. We should prepare for the team for the ‘next normal’ from the ‘new normal’. Preparedness is key when businesses rebound. Tourism associa-ons and Nepal Tourism board should organize and engage the interested ones in virtual training plaxorms.
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irtual tourism: Nepal should create and share its key highlights and des-na-ons on virtual V plaxorms.
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F ixing the basics first: Perhaps this is the best -me to fix the basics. For instance, roads in Kathmandu geQng a facelih are posi-ve steps towards achieving the basics. This lockdown should be used to upgrade the arrival and departure areas in the only interna-onal airport, fixing roads and basic facili-es for the benefit of the locals and visitors alike while also maintain physical distancing.
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ParAng thoughts Like many sectors, travel and tours has also been hard hit by the pandemic. In light of the current situa-on, the government should extend support to the businesses to stay afloat. It will enable the businesses to take sensible and sustainable decisions while working for reinven-ng for the next normal.
The above Expert Speak ediAon is wriaen by Mr. Pankaj Pradhananga. He is the Director of Four Season Travel and Tour.
Expert Speak: Pharmaceutical Industry
Along with health and financial crisis, business houses at the current -me are followed by economic pain. This case can go severe if not taken care soon enough. Business turnover and chain effects are too big to fall. Business challenges such as sharp decline in collec-on of market, the collapse of market demand, unavailability of raw material, mental disturbance in the workforce and nominal cash movement have caused great havoc. This widespread concern is even worsening as there is no mobility of raw material and finished goods from China and India leading to a high level of isola-on cost to the economy. En-re sectors are going under business trauma because of Covid-19. This fiscal year has become more of a year of survival for all enterprises. Especially service industries, tourism, avia-on and hospitality sectors have been hit hard by the outbreak. Tourism sector being one of the largest industries has been contribu-ng 8 percent to Nepal’s economy, which shall by now would not contribute for the next 6 months at least. Similarly, foreign employment, which has been contribu-ng 26% to the na-on’s GDP in the form of remiRance, has been impacted by the increased rate of virus pandemic. Impact on pharmaceuAcal industry Coming towards current scenario of the pharmaceu-cal industry, and talking about how it has affected, there are no pa-ents in the hospitals and clinics due to restric-ons in movement of the pa-ents and fear due to COVID-19 pandemic. At present, the total pharmaceu-cal market of Nepal is es-mated to be NPR 53 billion (approx. USD 430 million). Nepal imports NPR 28.65 billion worth of medicine from India and other countries, which is about 54.5% of the total market share, while NPR 24 billion worth of medicines are produced by domes-c industries, which is 45.5% of the total market share. Presently 59 industries are in opera-on and 26 industries are in pipeline. Major challenges since the outbreak begun have been collec-on of payments from the local market, sharp reduc-on in sales due to lockdown, restric-ons in the transporta-on of the medicines to other places, and availability of raw materials. Nepal imports 70-75% of raw materials from India while 25-30% from China. India imports around 80% of the intermediate products from China to manufacture raw materials. Therefore, Nepal is dependent heavily on India and India is dependent on China. Produc-on of the raw materials and intermediate products have reduced sharply in China, as a result, the cost has gone up 2-3 folds. India has banned the export of the essen-al raw materials like Paracetamol and a few others, which is going to create havoc in Nepal aher a couple of months if the situa-on remains the same. Most of the domes-c industries are either shut down or running at 20% capacity during the study done industry wise. The industry is facing problem to import raw materials from India due to the increasing trend of epidemics while China, on the other hand, is not responding. Way ahead To gear up the ac-vity for beRer survival posi-on of the industry, government and banking sector’s role is crucial. Policy for collec-on from market party needs to be secured as goods that were sold in credit earlier needs to be paid by now. What next if retailer party never intended to pay during the lockdown period. Who shall bear that risk? Similarly, in the case of such low collec-on point, how can businesses
make payment to interna-onal party? NRB policy cover issues of interest and short term loan dues -ll the period of Asadh. However, what should be the next provision if business houses are not fully opera-ng un-l the end. How can those bank interests be paid in Asadh if the business transac-on of the credit market is not opera-ng now? Besides these, a big challenge during the collec-on is the feeling of being in an uncomfortable zone. On top of it, there is no such ar-cle or regula-on where collec-on for private company can be eec-vely applied in case of failure in recovery. This is because people are trapped in social trauma where everyone says “How can you ask money in such pandemic -me and how can we payâ€?. Hence, to bring back orienta-on of market in discipline, every organiza-on needs to act as a partner to each other. Banks, vendors, par-es all stakeholders need to plan together sincerely at the least.
The above Expert Speak ediAon is wriaen by Mr. Vivek Man Vaidya. He is the ExecuAve Director of Vijayadeep Laboratories Limited.
Expert Speak: Tea Industry
AspiraAon Nepal, a na-on with a never-ending passion for HOPE – of a be0er future and RESILIENCE – to accomplish it,is suddenly looking at a catastrophe unlike any before. The Pandemic has not only created havoc in the popula-on’s physical and mental health but is also diminishing all economic progress made in the last decade in addi-on to drying out the foreign reserves and its major sources. Life, through and aher the pandemic, will be a constant fight for survival, for most of the populace. On the other hand, standing in stark contrast to this struggle, is the country’s undying strength, to prevail in the face of uncertainty. An agro-based plaxorm that can effec-vely take advantage of this strength, in today’s status quo, to truly achieve transforma-ve development from the grassroots with its larger footprint and mature infrastructure, is the Nepalese Tea industry. This op-mism comes from the reality that Nepal produces teas that are amongst the best in the world, surrounded by an expansive community driven (predominantly small farmers based bought leaf produc-on model) value chain that spans from tea pluckers to packaged products, for consumers, in a world where tea is the second most consumed beverage aher water (with steady growth in demand). Add to this the fact that Nepalese tea, which is merely scratching the surface in produc-on poten-al, is net export posi-ve, i.e., self-sufficient in tea produc-on and exports 95% of its hill-grown plus about 50% of its plains-grown produce. These factors when combined, points to an opera-ng environment, which if reinforced with appropriate support plus coordinated planning could generate exponen-al value for communi-es, industries and country while steadily being developed into a High-Value agricultural ecosystem. Struggle Now, despite the rosy posi-vity, Nepal’s tea industry has seen con-nued hardships in the past 2 decades and it is important to delve on major ones to understand the slow progress: star-ng with the establishment of CTM order 2000 and ini-a-on of Geographic Indica-on for Darjeeling tea by India. Which, made it difficult for Himalayan tea to find a market un-l that point, Nepal’s teas were essen-ally being bought through forwarding contracts and sold hassle-free by interna-onal buyers, simply as Darjeeling due to laRer’s brand significance. Although the situa-on did gradually recover, the distribu-on channel was forever disrupted with most Nepalese teas heading to India for value addi-on rather than the west. The civil unrest in Nepal further impeded growth and led to a massive migra-on of labour from the tea growing regions. This caused a substan-al shortage of experienced workers in the upkeep and harves-ng of tea farms as well as the processing of tea leaves, leading to degrada-on in quality and quan-ty of fresh tea leaves and hence the final product. Absence of skilled workforce also resulted in more use of pes-cides and chemical fer-lizers, bringing about major limita-ons in produc-vity, compe--veness and marketability of Nepalese tea in those years. These issues were gradually improved by shaking up women and marginalized groups in the community, with “the whole family approach” while ini-a-ng processes for integrated pest management and organic cer-fica-ons. Conversely, while prevailing deficiencies were being ironed out, another major challenge arose for high mountain teas of Nepal – an interna-onal project called the Unna- Challenge Fund came into being. While
the fund was launched to resolve major upstream challenges in the tea industry with key por-ons to be devoted to the grassroots, the fund managers in Nepal changed course at the last moment to invest in building more processing units for small farmers and middlemen or increasing produc-on capacity of micro units. This act basically tripled the produc-on capacity but did nothing for the expansion in planta-on area or yield of fresh green leaf, leading to cannibalis-c compe--on among exis-ng factories, which resulted in sheer degrada-on of the quality of tea leaves and ready teas. Moreover, the lack of exper-se of the added processing units in tea produc-on, market knowledge and logis-cs added to the woes and exacerbated the whole supply chain. Natural market correc-ons progressively ensued, as more than half of the new produc-on units closed while many are on the verge of shuQng down or changing hands. Uncertainty Today, fresh on the heels of the tea industry’s efforts to survive, comes the new COVID-19 pandemic. While there have been numerous opinions of a lesser effect on tea and other beverage industries, ques-ons are already being raised due to ensuing lockdowns and restric-ons being placed on the mobility of people and logis-cs. Big shorxalls in tea produc-on in the primary season (also known as first or primary flush, which gives the best returns to producers and farmers) coupled with limita-ons of movement both na-onally and interna-onally to deliver finished goods has caused addi-onal insecuri-es. This situa-on has been further aggravated by the na-onalis-c approach that many countries have taken to protect their own industries. Case in point being the recent intensifica-on of voices by the Indian tea Industry to pressure the Government of India to block all imports of tea from Nepal. Consequently, allega-ons of crea-ng deterrence to prohibit the entry of Nepalese teas into India is also rife, which if asserted, would be an establishment of non-tariff-based trade barrier by the government of India on Nepalese teas, viola-ng the trea-es and commitments to support the huge imbalance of trade, especially on agricultural produce. This is gradually looking to become the transitory norm around the world, un-l, as has always been the case with interna-onal trade, beRer senses overcome shortsightedness. Opportunity Despite the reserva-ons, there are some supposed bright silver linings for Nepal’s tea industry and the country, amidst the pandemic. Firstly, it is observed that the overall net demand for tea this year will rise, given the loss in produc-on across all tea growing countries and majorly the world’s highest tea expor-ng region, East Africa, that has also been badly affected by locust infesta-ons and unusual weather condi-ons. Secondly, the returning migrant workers could fill back the gap created earlier, to enormously help the tea industry in producing a higher quan-ty of good quality teas. An example of this was observed in the primary flush in the hilly regions (Produc-on in the Terai was nominal due to the enforced lockdown), where, even aher rela-ve delays in harves-ng, the yield and quality of green leaf was far superior due to the addi-on of mo-vated labour in the farms. Now, just combining the above factors with Nepal’s strength of ‘Hope’ and ‘Resilience’ provides adequate encouragement to resolve issues on various levels, but this pandemic today offers a window of opportunity to go one step further – the reset of the tea industry. The essence of this fresh start would have to begin from the grassroots by mobilizing all groups in the community including all returning migrant workers for a larger catalyzing effect throughout the value chain. This ac-on would support the ini-a-on of necessary conversion to organic or similar natural prac-ces of agriculture; allow beRer agri-prac-ces for upkeep and harves-ng, promote efficient land / organic input u-liza-on to boost yields and generate finer quality fresh tea leaves, to afford beRer prices
to farmers. Accordingly, larger quan--es of superior (organic / bio) Himalayan teas would lead to increased demand and higher prices while unlocking access to new markets that were earlier under the control of tradi-onal suppliers (countries with a larger magnitude of produce or brand significance). Which would give rise to higher brand awareness and consumer percep-on, resul-ng in added compe--on and greater demand for beRer quality green leaves plus wider cul-va-on of tea, augmen-ng economic benefits and overall wellness of communi-es. This, in turn, would invigorate the steady transi-on to high value agriculture. The realiza-on of which will allow actual value addi-on at source and further market driven investments for innova-on throughout the value chain while genera-ng environmental resilience, biodiversity and economic sustainability that could be replicated ubiquitously. The enlarging circle would progressively lead to con-nual development, mul-ply employment opportuni-es, increase government revenue and foreign currency reserves while stabilizing the balance of trade. However, as with all transforma-ons, it is important that all stakeholders play their part and this is where the government of Nepal becomes mandatory. The success of any ecosystem is wholly dependent on the prosperity of that ecosystem, to create an ecologically and economically sustainable model. Therefore, it is impera-ve for this once in a life-me ‘Reset’ to be favourably supported by the Government of Nepal (unlike other tea producing countries that are prized and supported by their respec-ve governments, Nepal’s tea industry lacks the support of the government) via financial and technical resources from the ground up. Likewise, in an era where other countries boast of Ministries of tea and Ambassadors of Tea in their respec-ve embassies, it would be vital for Nepal to at least create an endearing Public-Private partnership by forming a strong Tea board that would not just touch on all aspects of the tea value chain but be fundamental in dynamically linking the government and private enterprises with one single mission, the way to Nepal’s first export centred Billion Dollar Agri-based industry.
The above Expert Speak ediAon is wriaen by Mr. Neeraj Rathi. He is the Managing Director of Himal Tea Industries Pvt. Ltd.
Expert Speak: Hospitality Industry
To comprehend the impact of the ongoing Covid-19 pandemic and the ensuing lockdown, Pramita Sakya Director of Sales ACE Hotels shed some light on some key pertaining issues and the future that lies ahead for tourism and hospitality sector. Impact of COVID-19 and the lockdown on your business and how are you miAgaAng the current situaAon? The coronavirus pandemic, which started in late December 2019, has disembarked us at unchartered territories; something we have never experienced before. Both our hotels Club Himalaya, Nagarkot & Ambassador in Kathmandu were seeing healthy and sustainable growth in 2018 & 2019. March 2020 the gross reality of the pandemic hit us hard. We saw our occupancy drop from 92% in November 2019 to 50% in February 2020, 22% in March and currently are running on single digit occupancy. While hotels have chosen to shut down, we chose to con-nue to serve our long-term guests. However, the decision has been biRersweet. On one hand, closing shop makes more fiscal sense; but con-nuing to serve our guests is what keeps us going and gives us hope for the future. The only thing we can vaguely compare the current turmoil in business due to Covid-19 was the height of the Maoist insurgency era where a number of big hotels had to shut down as Nepal was labelled as an “unsafe” des-na-on due to the insurgency and we were seeing less tourist arrivals. The case today is completely different now as we are harder hit today and this is a global problem. In terms of steps taken by us to mi-gate risks, in summary, our basic aim is to survive this turmoil. First and foremost, health, hygiene and safety standards of the guests, employees and physical spaces have taken as number one priority. I do not want to go into financial risks and details of the pandemic here. All I would like to say is the organiza-on has to survive to take care of its stakeholders. Every decision we take henceforth is keeping survival in mind. Key areas to focus on a_er COVID-19 To each his own: for us, survival is the key. Secondly, health, safety, hygiene of our employees and guests is our number one priority. We have already designed new protocols for when we open full-fledged. We will make masks, gloves, sani-zers the new normal (un-l required). I do not want to go into what the government should do; the list is endless. We will focus on what we can do and survive these unprecedented, unplanned, & unimagined phase. The future of tourism sector I am an eternal op-mist. I am an avid traveller. I am already dreaming of future travels. Therefore, I personally believe that people will never stop travelling. It is but human to travel either for business or for pleasure. Therefore, there is no doubt that travel will resume slowly but surely. However, the way we travel will defer immensely at least un-l the vaccine arrives. Travellers will definitely look for service providers that are going above and beyond to minimize the risks of contamina-on. All previously,
unroman-c no-ons of travels like sani-zers, gloves, masks, air puriďŹ ers will become criteria in choosing service provider. Price and the view from our hotel room may come at the boRom of the list for some -me at least. Therefore, to answer it simply the future of travel is s-ll bright: there is adequate light at the end of the sani-zed tunnel.
The above Expert Speak ediAon is based on the conversaAon with Ms. Parmita Sakya Shrestha. She is the Director of Sales at ACE Hotels.
International Practices
Lessons for Nepal An iniAaAve by NEF to understand how organizaAons in dierent parts of the world are overcoming the COVID-19 crisis.
Lessons of adaptability amidst coronavirus from Hong Kong If five months ago, the narra-ve of streets looking empty, students being out of schools, businesses being termed as essen-als and non-essen-als to determine whether they should be allowed to operate or not, or even geQng a plate of your favourite food from your favourite restaurant being newsworthy would have been brought upfront, it would have been a laughable maRer. But, that is the power of a crisis. In light of the current COVID-19 pandemic, the unthinkable has happened. Businesses across the world are shut down and as a result, economies across the world are witnessing crippling effects. Today, no-ng that the first coronavirus case was reported in early December 2019 in China, a long -me seems to have passed. What is clear is that prohibi-ng businesses to resume their opera-ons for ‘flaRening the curve’ is an extremely risky strategy. Given this, many countries have started exi-ng lockdown and con-nuing their businesses despite coronavirus cases with Hong Kong being one of such economies. Some 1,000 restaurants and food establishments throughout the city of Hong Kong were shut down, and a ban on foreign visitors was brought into ac-on with the onset of COVID-19. Thus, the economy of Hong Kong contracted by 8.9 percent in the first quarter of FY 2020, wherein a 10.2 percent drop in private consump-on has been aRributed as a major driver of the contrac-on.[i] Despite this, some businesses have found their way of opera-on in these difficult -mes. A small community of organic vegetable farmers in Hong King has experienced a business boom amidst the pandemic. At a -me when COVID-19 had started to cause logis-cal problems in the supply chain from the nearby Chinese mainland to Hong Kong, the costs of imported produce increased by 30 percent to 50 percent. Because of this, the locals tried to source local vegetables.[ii] Amidst this, Mapopo Community Farm, which has been running for the past ten years, witnessed their profits double aher they reopened their sales since February. One of the farmers noted that the coronavirus crisis has underscored the need for Hong Kong to become more self-sufficient when it comes to food as the city currently imports more than 90 percent of its vegetables from mainland China.[iii] Apart from this, the hotel industry in Hong Kong is also in a survival mode. Although they might not witness a V-shaped recovery in opera-ng performance, some signs of demand in the short-term have been coming up considering several overseas students might be returning and might need short-term accommoda-on for self-quaran-ne. Some hotels offering discounts on the short-stay plans are even enjoying full bookings. Such steps are not permanent solu-ons, but in a way ensure that visitors keep coming.[iv] Contactless technologies and hygiene regula-ons have been given the utmost importance.
If such businesses boom, it is expected to not only work posi-vely for the economy but also the community. For instance, hotels like the Tai O Heritage Hotel are opera-ng as a nonprofit social enterprise. The proceeds and revenues of the hotel are contributed fully to hotel maintenance, community engagement, and commitment to Tai O village, such that its heritage, conserva-on, tourism, and green living are promoted. With this, the hotel has witnessed a change in the demographics of people making bookings. While 75 percent of the guests used to be local in any typical year, since February 2020, the hotel has received 92 – 95 percent local bookings. [v] Similarly, Hong Kong’s urban farmers, Roohop Republic have faced cancella-on or postponement of most of their events since the outbreak of the virus. However, to stay afloat in the market, they have resumed their opera-ons by experimen-ng with ‘Online Plan-ng’ classes. They have been trying to impart posi-ve and uplihing news in their mass communica-ons while also ensuring addi-onal health measures in their public events.[vi] On the other hand, a plant-based natural beauty and skincare brand named ZeroYet100 has adopted a different strategy by launching hand sani-zers, as well as by rethinking old ways of doing business by minimizing on the packaging and being more mindful about business opera-on issues from the past. Learning is CriAcal Certainly, there are valuable lessons to be learned from the approaches of economies such as Hong Kong where businesses have been rethinking their ways of opera-ng and where the government has been able to fairly contain the contagion despite an economic hit. Findings that emerge from countries like these are a learning opportunity especially to iden-fy and understand what does not work. At the same -me, it is notable to the contrast between these approaches with countries of similar socioeconomic profiles for Nepal to accelerate its efforts. Only then can resources be allocated effec-vely. As Stanford economist Paul Romer put it, “A crisis is a terrible thing to waste”. This is the -me for all three -ers of the Nepali government to work proac-vely to create an enabling environment for businesses to resume their opera-ons. In addi-on, it is impera-ve that businesses show both ci-zenship (an interest in societal well-being) and resourcefulness (developing crea-ve responses to emerging challenges with scarce resources) to boost the na-on’s economy.
- wriaen by Nasala Maharjan
References: [i] Brunnersum, Melissa. “Coronavirus: Hong Kong reopening threatens to renew mass protests”, DW, 13 May 2020. Retrieved from- hRps://www.dw.com/en/coronavirus-hongkong-reopening-threatens-to-renew-mass-protests/a-53423607 [ii] Chow, Vivienne. “In Hong Kong, buying locally-grown vegetables is about more than just figh-ng coronavirus”, WQuartz, 2 April 2020. Retrieved from: hRps://qz.com/1819651/localfarms-in-hong-kong-are-thriving-because-of-coronavirus/ [iii] Ibid [2] [iv] Wong. Mar-n. “Hong Kong hoteliers can forget V-shaped recovery as coronavirus brings new norm to industry”, South China Morning Post, 31 March 2020. Retrieved from- hRps:// www.scmp.com/business/ar-cle/3077515/hong-kong-hoteliers-can-forget-about-v-shapedrecovery-coronavirus-brings [v] Marcus, Lilit. “The Hong Kong hotel weathering the coronavirus storm”, CNN, 6 April 2020. Retrieved from- hRps://edi-on.cnn.com/travel/ar-cle/tai-o-hotel-hong-kong-intl-hnk/ index.html [vi] Ho, Sally. “9 Hong Kong Businesses Share How They Are Coping With Coronavirus”, Green Queen, 2 April 2020. Retrieved from- hRps://www.greenqueen.com.hk/9-hong-kongbusinesses-share-how-they-are-coping-with-coronavirus/