It’s not too late for action: COVID-19 – An analysis
The global community confronts the novel COVID-19 virus. Tourism, trade, industry and social lives remain disrupted and deeply and widely damaged. Countries, such as Singapore and Malaysia, have taken leadership in the economic repair, maintenance and rebuilding of their tourism and other aspects of economies. In Nepal, Government and industry have started thinking and working towards studying and evaluating the real impact of this force majeure situation. Nepal Rastra Bank has come up with a broad guideline under its recently announced monetary policy specifying a need for financial support to the industry. These actions are appreciable, though late, but not too late, if actions are taken now.
Tourism is a chain of economic sub-systems. The outbreak of the virus has made severely adverse impact across the chain. From the airport to airlines continuing to the end of the value chain, that is retail outlets. The size and depth of the impact go in proportion to the nature, type and size of the businesses. As the guardian of the industry, government should consider extending support to all stakeholders of the industry.
Flight frequency, tourist arrivals, hotel occupancy and footfalls in the heritage sites and tourist locations have nosedived to the bottom. Airports are experiencing a dramatic drop in the airport revenues, airlines have lesser travelers and lower yields per seat kilometer flown, hotels have cancellations not only in room bookings but also banquet cancellations severely affecting their f/b revenues as well, tour operators and transporters have largely grounded their guides and vehicles. As it evolves, the outbreak of the virus has no known immediate outlet nor an assured remedy.
In a situation of uncertainty, wise decisions are important, and their timely execution is more important, however. The industry and public to feel the good governance, decisions and actions if taken now will help. It’s time for the government to give back to the industry in the forms of refinancing of interest to airports, airlines, hotels, and tour operators, easing cashflow by repayment restructuring, reducing aviation fuel, waiving airport charges and certain taxes. In the meantime, all stakeholders should also act more aggressively for recovery.
It’s time for the government to hear and feel the cry of despair of the industry and, in response, act NOW.
Mr. Vijay Shrestha
Former President of Airline Operators Association of Nepal (AOAN)