The Visit Nepal Decade and five million tourists by 2032
On the 23rd of September 2022, the Nepali Cabinet
approved a plan by Nepal’s Ministry of Culture, Tourism and Civil Aviation to
declare a Visit Nepal Decade from 2023 to 2032. The twin primary aims of the
campaign will be to attract five million tourists by 2032 from an earlier all-time
high of 1.2 million visitors in 2019 and increase the average spending per
tourist per day to USD 125 from the current USD 47. Both are daunting tasks but
not as ambitious as a third aim, discussed and discarded as being impractical; to
increase the average length of stay to 20 days per tourist from the present 12
days.
It will do well to recall here that past Visit Nepal
campaigns were limited to a particular year. Visit Nepal ’98. Destination Nepal
2011, Lumbini Tourism Year 2012, and most recently the aborted Visit Nepal Year
2020. Each of those in addition, save the Lumbini one, had a single aim -
denoted in number of tourists to be attracted to Nepal in that particular year.
In 1998 the aim as to bring half a million tourists; in 2011 it was pegged at a
million tourists; and in 2020 it was two million tourists. The Government of
Nepal designed Lumbini Tourism Year to ‘raise awareness about Lumbini.’
Each successive campaign has failed to deliver in the end
for assorted reasons.
In 1998 Nepali Tourism would come tantalizingly close to
hitting the target with 463,684 arrivals. It would come achingly close again in
seminal 1999 with 491,504 arrivals. 1999 is remarkable for the hijacking of
Indian Airlines Flight IC 814 after departure from Kathmandu for Delhi on
December 24 which would affect air arrivals from India well into the next year
when the arrivals figure would dip ominously to 463,646. In 2001 the Royal
Massacre would once again put the spotlight on Nepal, and the Maoist Insurgency
would draw in the Nepal Army and violence would escalate driving down arrivals to
less than the 300,000 mark till 2006. It would only be in 2007 that Nepal would
attract a little over 500,000 tourists.
Barring the 2008 and 2009 dips due to the Global Financial
Crisis tourist arrivals would gather pace and grow at impressive double digit
growth rates and yet, not
make the mark set by the planners of the Destination Nepal 2011 campaign and reach
just 736,215 tourists that year. Well short of the planned one million tourists’
mark. In fact, that figure would only be reached in 2018.
In 2020 COVID-19 would mar the party early on and decimate
tourism worldwide and the target of attracting two million tourists would never
be put to the test. On 22 March 2020, the Government of Nepal would announce
the termination of the campaign citing the pandemic.
What the earlier campaigns did not comprehensibly address
was the ‘why?’ and even marginally address the ‘how?’ of reaching the stated
goal or target tourist numbers.
The Why
The closest thing to a rationale that seems to have been
applied was that these numbers may have reflected the number of tourists needed
to fill about 70% of available hotel rooms at those points in time to, in the
more extreme cases, these numbers were simply pulled out of ‘thin air’ because
they seemed like the appropriate ‘next’ milestones. In this respect, the VND
seems to have, knowingly or unknowingly addressed the why: to welcome five
million tourists spending, on an average 12 days (current average) in-country
with an average spend of USD 125 per day gives us a target of 7.5
billion dollars in earnings from international arrivals. Finally, it is about
the money. It should have been all along.
The How
Next, comes the even more tricky, ‘how?’ How indeed are we
going to get five million people to visit Nepal by 2032? And how are we going
to get them to spend USD 125 per day while they stay here? These are not questions
that are going to be answered by a committee formed with all the stakeholders present
and which is tasked with writing its own ‘Terms of Reference.’ These questions
must be answered at ‘The Very Top.’ At the same Cabinet meeting room where the
idea was inflated and endorsed.
Elections are around the corner and every outcome scenario
has a coalition Government of sorts coming out on top. Be it the ruling
Congress-Maoist-LSP triumvirate or the UML-RPP duo. A successful VND must first
have the ‘buy-in’ from all national level political parties, at least, if not
from all the bit players as well who may end up in the halls of power by dint
of chance come November. This will ensure that the idea is not aborted by the
time 2023 rolls around. Next, comes the task of aligning every ministry and
government department to the idea that tourism is going to be the go-to
economic driver of the Nepali economy in the next decade going forward and at
the same time ensuring that other sectors are not ignored.
So how? Let us say that the political parties and the various
governmental departments are on board. Once the former are on board, the latter
should not be a problem. Then, sooner rather than later, the question of ‘how?’
needs to be tackled along with ‘from where?’ How to get five million potential
tourists willing to spend USD 125 per day interested in buying a trip to Nepal
is a Sales and Marketing problem. How to get the interested five million to
Nepal is a logistical one.
Both problems beg solutions that cannot be conjured from
thin air. Dreaming like, ‘Oh, all we need to do is target a small part of the
neighborhoods out-bound travelers,’ might buttress the head count but will not
help with spend targets. Also, as a rule, short haul travelers are influenced
by the morning news and are notoriously fickle. In that, they can change plans,
destinations, and travel dates much more often and easily. It will need substantial
budgets, deep market insights, clever brand promises and delivery, regular
audits leading to realignments, recalibration, and a host of other things to
pull off.
Getting five million people to Nepal once they have been convinced
to visit requires connectivity. To some extent road connectivity but, in large
measure, air connectivity. Let us do the mathematics. In 2019, the last
‘normal’ year 58% of arrivals came to Nepal in the high-tourist season months
of February, March, April, October, November, and December. Let us assume the
pattern will stay. In these six months in 2032 we will need transportation for two
million nine hundred thousand tourists. Of which 340,000 will travel by road. Let
us also assume that 3 million Nepali travelers will also travel throughout that
year, and we will need an additional 1.5 million seats allowing for a total
arrival of 4 million 6 hundred thousand by air in those six months alone. We
will need to land, in one of Nepal’s three operational international airports
25,556 arrivals every day. That is the equivalent of 102 two hundred fifty-seater
planes every day in either KTM, BWA or PKR. Pokhara cannot take wide-bodies and
the other two will need to do the heavy lifting. For the rest of the year, we
will still need to land, the equivalent of eighty-five two hundred fifty-seater
planes every day. Ambitious and Daunting, to say the least.
Ambitious and daunting does not mean impossible. However, it
does mean that the proposed Cabinet meeting to answer the ‘why’? the double
‘how’? and ‘from where’? needs to sit, preferably with the scattered political
players, bring them on-board, and then entrust the task of planning and
execution to competent people.
The potential pay-off
The IMF forecasts a 7%
growth per year in GDP for Nepal between 2023 when Nepal’s GDP is expected to
be USD 39.03 billion and 2027 when it is expected to be USD 51.17 billion (source:
IMF). Keeping the same projection, Nepal GDP should be USD 71.76 billion in
2032. USD 7.5 billion from arrivals that year will put earnings from tourism at
10.46% of GDP. Currently tourism contributes about 3% of GDP. That would be
from in-country expenditure by arriving tourists. Add to that the potential of
earnings from a well-run airline with 60% market share which has a further
potential of earning USD 6.5 billion at approximately USD 700 per one-way fares
by 2032 from 4.6 million tourists arriving by air. Tourism earnings can by
then, potentially contribute 19.51% of GDP. Formidable numbers. Reminds me of lyrics
from the song ‘The Devil Cried’ by the legendary Ronnie James Dio of the
equally legendary heavy-metal band Black Sabbath which went:
I can win this game
If all things come together
I know this sounds quite strange
I won't be smart, just clever
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