KATHMANDU, JULY 25
The Hotel Association Nepal (HAN) has expressed disappointment over the Monetary Policy announced by the Nepal Rastra Bank for the current fiscal year, stating that it will not be able to address the existing problems seen in the hotel and tourism sector.
As a result, the association has decided to take the necessary initiatives to revive the hotel and tourism sector, which has been affected by the extreme economic recession due to the war between Russia and Ukraine by providing facilities related to refinancing and rescheduling of loans, and low-interest rates through the monetary policy and related solutions.
Although the budget and monetary policy for the current financial year indicate that the number of tourists has increased alongside economic activities, hotels across the country have been operating at less than one-third of their total capacity and are operating at a loss, a statement released by the association reads.
As a result, hotels are facing difficulties in paying the principal and interest to the banks. Although the third-quarter review of the monetary policy of the last financial year had introduced provisions for refinancing and rescheduling of the principal and interest, the government's decision to discontinue such provisions in the current fiscal year has confused the hotel and tourism stakeholders, according to HAN.
As the entry of world-renowned hotel chains in the country is increasing, the current monetary policy is not encouraging enough. According to HAN, attracting more tourists into the country is becoming difficult due to the tax imposed on raw materials such as vegetables and the luxury tax. This association believes that the guidelines for the implementation of the monetary policy to attract investment and encourage the hotels will provide stability to the hospitality sector.
The Hotel Association Nepal has anticipated the central bank to come up with guidelines to encourage investors and make the economy vibrant, including welcoming one million tourists to the country this year; to celebrate 2025 as a special tourism year, and make the tourist decade a success and meaningful as announced by the government.
A version of this article appears in the print on July 26, 2023, of The Himalayan Times.