Ministry of Commerce And Supplies - Enhanced Integrated ...

N T I S2010Constraints in the tourism sector exist in the form of immigration laws, documentation requirements,restriction on currency movement, lack of transparency, and policies that work as a disincentive for specificdestinations. The section below describes the barriers to export of tourism services.Barriers to Tourism ServicesRegulatory Barriers: Nepal opened travel agency and tour operator services for foreign investment up to 51 per cent foreignequity under its WTO Schedule of Commitments. This has yet to be put in practice owing to the lack ofa domestic regulation to abide by the WTO commitments; The lack of capital account convertibility is a constraint. Tourism promotion abroad requires largeexpenditures and people with international linkages, which are made difficult possibly due to the lackof capital account convertibility. Also, Nepalese traveling abroad are allowed to exit the country withonly US$2000; The Hotels and Restaurants Act 2038 (1981), formulated 30 years ago, remains in place and needsrevisions. For instance, the Act does not include provisions for opening hours of bars, dance clubs, andrestaurants; TIA, Nepal’s only international airport, closes at 12.30pm, putting pressure on daytime air traffic;International Market Access Barriers: Though China approved Nepal as a tourist destination in 2001, only three agencies in China providetravel services to Chinese wishing to visit Nepal, hindering the free flow of Chinese tourists;Domestic Barriers to Market Development Pokhara, the second city for foreign visitors, is to be strengthened as a tourism destination. However,the development of a regional international airport cannot materialize without support from donoragencies; The high ground handling charges and high fuel cost at TIA force large airlines to refuel outside Nepal; The lack of sufficient airport infrastructure and associated facilities at TIA needs to be addressed byinvolving the private sector; Though Nepal has 54 local airports, which is a good number for such a small country, quality of manyof the facilities is a problem; The very high mountaineering royalty charged by the GoN for climbing Mt Everest, (US$50,000) ispushing parties to climb Mt Everest from the Chinese side. Also, if one goal is to diversify and lowerthe pressure on Mt Everest, the Government needs to lower the royalties for climbing other Nepalesepeaks; Nepal has failed, thus far, to mobilize and involve foreign missions, Nepaliesenon-residents anddiaspora for more aggressive marketing of Nepalese tourism.Institutional Barrier: The Service Enquiry Point established under the WTO Division of the MoCS is acting as the coordinatingbody of the services sector in Nepal, which is being represented by 17 ministries or agencies at present.However, the enquiry point is not functioning effectively for lack of necessary human resources,equipment, and proper mandate and work plan;NEPAL TRADE INTEGRATION STRATEGY 2010BACKGROUND REPORT217