‘Tourism sector needs satellite accounting’

Kathmandu, January 25:

The contribution of tourism to Nepal’s economy has been a source of constant debate. While a certain section of the power-wielding, decision-making class maintains that despite all importance attached to it, tourism contributes a minuscule 1.5 per cent to the GDP, earning about $ 180 million, tourism entrepreneurs and stakeholders beg to differ. According to them, the exact contribution of tourism sector can only be gauged after taking into account the impact of tourism on other sectors of the economy.

According to Nepal Tourism Statistics 2005, total foreign exchange earnings from tourism in 2004-05 stood at 6,683.2 which accounted for 1.2 per cent of the GDP. While figure for 2005-06 has not been made available as yet, tourism officials claim it would be less than two per cent.

However, according to World Travel and Tourism Council (WTTC), tourism in Nepal contributes not less than eight per cent to the GDP and employs more than 500,000 people, directly or indirectly.

The latter, understandably, takes into account the impact of tourism on other sectors of the economy like agriculture, manufacturing, handicrafts to name a few.

It is this detailed accounting of tourism, technically called Tourism Satellite Accounting (TSA), that the Nepal Tourism Board now plans to undertake in its endeavour to give the industry its due share of importance.

NTB is tying up with the Central Bureau of Statistics for all the data and expertise on accounting.

Although concept of TSA was theoretically pioneered by the World Trade Organisation, it was the WTTC which developed a method for measuring the economic impact of tourism on national economies over the past 15 years.

According to a NTB official, two important studies on the board’s agenda are: To take up detailed accounting of tourism or TSA in an attempt to identify the real impact of tourism on every sector of the economy; secondly, conduct an indepth survey of the expenditure pattern of international tourists in order to redefine its concept of value and volume markets.

“Satellite accounting will help us in ascertaining the total impact of tourism, besides giving the industry a better bargaining power with politicians who seem to be more concerned with their political agendas than the economy,” points out Basant Mishra, chairman, Nepal Association of Tour Operators (NATO).

Concurs Dhruba Narayan Shreshtha, president, Nepal Association of Tour and Travel Agents (NATTA) said, “We need to give tourism its due. Going by statistics that each tourist employs between 9-11 people, 500,000 tourists signify employment to over 5 million people.”

Shreshta maintains tourism and hydro-power are the only two promising sectors in Nepal’s economy. Nevertheless, according to Mishra this is not the right time for getting into TSA or any other research work.

“The focus of tourism officials and entrepreneurs should be in reviving the industry to the 1999 level of prosperity, targetting for half a million tourists. Only then should we take up any research work to establish the significance of the industry,” feels Mishra.