At a time when Nepal’s tourism industry is in the process of recovery, trade unions affiliated to the CPN-UML and UCPN-Maoist are threatening to shut it down. Although hoteliers and trade unions have signed agreements not take any action that will push for closure of the industry, the Maoist affiliated unions have shut down Hotel Vasihali, a Thamel based four star hotel. 


This is not for the first time Nepal’s trade union has made efforts to shut down the hotel industry. Coincidentally, whenever Nepal’s industry makes some progress, the trade unions launch strikes. Nepal needs peaceful atmosphere in industrial sector to get high economic growth. Given so many anti-industrial trade union acts, it is impossible to move forward.


Nepal’s industrialists have been demanding amendment to the Labor Act making it investor friendly. “There is the need amending the Labor Act to give peace and stability in the industrial sector. In the present circumstances, nobody will come to invest in Nepal,” said Bhaskarraj Karnikar, senior vice president of FNCCI.


Hotel Vaishali located at Thamel, the main tourist hub of Kathmandu, has been shut down from Monday by the management after the workers stopped their duties demanding salary hike. Following a decade of economic crisis created by the violent Maoist insurgency, Nepal’s hotel industry is now in the process of recovery as visitors continue to soar.


International visitor arrivals to Nepal via air have increased by an average of over 21.5 percent, totaling 501,264 visitors, the highest number in tourism history of Nepal during 11 months of the ongoing Nepal Tourism Year 2011.


According to figures released by the Immigration Office, Tribhuvan International Airport (TIA), the visitor arrivals have also increased by 20.3 percent to 58,156 visitors in the month of November compared to the same month last year.


The South Asian region, except for Bangladesh, has shown overall positive growth. The arrivals from India, Sri Lanka and Pakistan have registered growth of 22.1 percent, 22.1 percent and 27.4 percent respectively while Bangladesh witnessed negative growth of 11.8 percent in the month of November 2011.


Similarly, other Asian countries: China, Japan, Malaysia, Singapore and South Korea have maintained the upward trend with 149.4 percent, 6.2 percent, 9%, 16.9 percent and 11.3 percent of growth respectively. However, arrivals from Thailand have witnessed negative growth of 26.1 percent.


Except for Belgium, the Netherlands and Switzerland, all the markets of Europe have maintained positive growth. Arrivals from the United States of America, Canada Australia and New Zealand have also increased in November 2011 in comparison to the same month last year.


However, the threat of trade unions has once again dangled a sword at the slowly reviving industry. Vaishali is not the first case, just last month hotel workers affiliated to the UCPN (Maoist) closed down the Club Himalaya Resort at Nagarkot. The trade union affiliated with the CPN-UML has threatened to shut down hotels in Pokhara over salary hikes. Other hotels in the valley are also facing similar threats.


Trade unions are demanding the implementation of the minimum pay as fixed by the government on March 15. However, Hoteliers are saying that they have already increased the salary as per the government’s decision.


The closure has forced hotel guests to move to other places. The workers have said that they will not resume work unless the management considers their demand.


The General Federation of Nepalese Trade Unions (GEFONT) which is affiliated to the UML has threatened to close down all the hotels in Pokhara within a week if the workers do not get a raise as fixed by the government. GEFONT said that only three hotels in Pokhara have implemented the government’s decision.


“If the management does not implement the government’s decision, we will be compelled to close down all the hotels in Pokhara,” said Yubaraj Poudel, president of the Gandaki unit of GEFONT.
As of now, Fishtail Lodge, the Shangri-La and the Pokhara Grand have implemented the new salary schedule fixed by the government. There are 400 hotels and 300 restaurants in Pokhara employing 10,000 workers. 


If the political parties do not press their sister organizations to maintain restraint, Nepal’s hotel industry, as well as tourism industry, will face a severe crisis.