Nepal

• Client: World Bank
• Partners: HM Design and Traditional Hospitality Nepal
• Project Duration: October 2019 - June 2020

Project Overview:  

Tourism is an important contributor to Nepal’s economy, poverty reduction, employment generation, and income redistribution. The WTTC report estimates that the sector supported nearly one million (945,000) direct and indirect jobs in 2016, or roughly 6.4 percent of total employment.

While the number of visitors has increased sharply in 2016 and 2017, tourism receipts are still low compared to competing destinations. The daily average spend per tourist remains low at $54 in 2017, compared to a regional average of $100-150 in 2016. There is also a quality and standards gap, whereby 80% of hotels in Nepal are in the tourist standard category catering to the low-tier tourist segment. Unhealthy competition entails companies competing on price alone, undercutting each other and paying little attention to the quality of products provided to tourists.

Overall, it appears that there is a tendency to maximize the number of visitor arrivals versus the value of visitors. A more sustainable strategy would entail efforts to increase the per tourist revenue by offering a more diverse set of higher-value and higher quality facilities that appeal to the middle and high-income tourists, while also trying to increase at a moderate rate the annual number of tourism arrivals.

The purpose of this assignment was to implement activities linked to the Nepal Creating Markets for Tourism project.  The objective is to support the Government of Nepal on promoting higher end tourism in the Annapurna Conservation Area (ACA) and identify private sector investment opportunities towards new heritage and cultural tourism products through the following:

1. Supporting heritage villages to provide diversified offer in Lower Mustang through identifying specific investment concepts and developing investment pitchbooks to be taken to market
2. Supporting linkages to market leaders for higher-end resorts and franchise opportunities along new trails in Manang

Major Activities

1. Formulate investment plans/models for three integrated heritage villages (i.e. Tukuche, Marpha, Kagbeni) to support rural municipalities to manage the villages, with an overview of regulatory requirements to facilitate private sector investments.
2. Create an investment pitchbook of the potential traditional old heritage properties located in 3-4 villages (ie. Kagbeni, Tukuche, Marpha), approved by the ACA authorities (NTNC), and disseminate among potential investors.
3. Facilitate linkage of existing lodges to local/global heritage boutique resorts for potential management through their own brands.
4. Share global best practice examples through a seminar that includes breakout workshops and technical deep dive sessions
5. Presentation of investment concepts and pitchbook at a final seminar.

Results

Support the Government of Nepal on promoting higher end tourism in the Annapurna Conservation Area (ACA) and identifying private sector investment opportunities.