Business Implications of COVID-19 Outbreak: Nepalese Economy
Today the World is experiencing the impact of the coronavirus (COVID-19). The business and economy implications in pandemic is showing adverse effects and pushing mankind behind. The spread of coronavirus is leaving a vast magnitude of economic damage in its wake. In this volatile period, the pressure is on for business leaders around the globe for shaping their strategy. And restructuring their organizations to deliver better and lasting results for all their stakeholders. The pandemic implications in business and economy is very huge, especially in countries like Nepal.
Covid-19 on Nepalese Economy
Nepal is also being subjected to the negative repercussions due to this deadly pandemic. As per the report published by the Asian Development Bank, taking the pandemic into account. The growth forecast for Nepal has been revise to 5.3 percent this fiscal year, which ends in mid-July. Prior to the pandemic, it had forecast a 6.3 percent growth rate. However, economists still consider the revised growth rate too optimistic. Many sectors have started to face the impact with the service industries. Such as, tourism, hospitality, and aviation sector being hit the most by the outbreak.
Business implications due to pandemic
One of the largest industry in Nepal, the tourism industry has been contributing 8 percent to Nepal’s economy. The tourist arrival rate has declined to below 10 percent, from 70 percent before the outbreak. Which devastate the tourism and hospitality-related business sector. Banks are also undergoing a loss of their investments in hospitality and aviation due to the decline in tourists. The trading sector is impact by the sharp drop in imports from China following the outbreak.
Remittance, a major contributor to Nepal’s economy, is currently facing a disastrous impact due to the coronavirus’ outbreak. In the last two months, remittance has contributed less than 1 percent in the country’s economy. Which can create severe consequences on overall consumption in the country. Some countries and organizations are building new advancements in technology but is still not enough for all.
Though we are yet to experience full repercussions and aftermath of the coronavirus, this global threat has created uncertainty about how deep and extensive the economic fallout will be. In such a situation, Nepal’s economy will be at risk of a much bigger impact than that directly inflicted by the virus.