"The restaurant business in Thamel went through many ups and downs over the last five decades but never before had we faced such a crisis," restaurant owner Shrestha complained.
KATHMANDU, June 18 (Xinhua) -- It has been 51 years since Tejendra Nath Shrestha's family ran their restaurant business in Thamel, a tourism hotspot in the Nepali capital of Kathmandu appealing to foreigners in particular.
Never before in the last five decades had Shrestha found the hustle and bustle of past daily life in Thamel so deserted now after a deadly second wave of the COVID-19 pandemic hit the Himalayan country in early April.
Shrestha's elder brother started his Ying Yang restaurant in 1970 targeting Thai tourists, while he himself opened "Third Eye" in 1989 serving Indian visitors.
"The restaurant business in Thamel went through many ups and downs over the last five decades but never before had we faced such a crisis," Shrestha complained. "In the past, the restaurant business had suffered when the country was in the civil war, earthquake and subsequent trade blockade by India in 2015, but never on the scale that we are experiencing now."
After shutting down his restaurant for around five months during the lockdown last year, Shrestha restarted his business. Even though business was not as usual due to a lack of foreign tourists, he was prepared to wait for the situation to improve.
Unexpectedly, the second wave of the epidemic is denting his hope, as the Kathmandu Valley has been placed under a lockdown again ever since April 29 to confront more coronavirus infections, forcing him and his brother to close their restaurants.
"I am not sure whether I can sustain the restaurant business if the current situation prolongs," he said.
Until foreign tourists return, the restauranteur does not expect a smooth business as he relied on foreigners for 80 percent of businesses.
In the early months of 2020, Nepal welcomed 230,085 foreigners before a lockdown was imposed in late March. In 2019, the country received 1.19 million foreign tourists, according to data from the Department of Immigration.
Though unwilling to shut down the business, Shrestha is not sure whether he can continue it as many other restaurants in Thamel have already put up the shutters.
"Now, there is little hope that tourism will rebound anytime soon, which is worrying for us," said Shrestha.
What has kept him in business is an understanding landlord who has shown patience despite delayed payment of rent and he himself having no loans to pay for at the moment.
Shrestha is not the only businessman suffering from the COVID-19 pandemic.
Shova Laxmi Rajbahak, who had run a poultry farm at the Goldhunga area of Kathmandu for three years, abandoned her business last year after suffering losses during the lockdown.
"As I could not sell chickens in the market in time due to the lockdown last year, I had to suffer losses," she said. "As I was forced to sell the overgrown chickens, I could only recover the cost of chicken feed."
Rajbahak used to raise 2,000 chickens in one lot. She still plans to reopen her poultry farm once the pandemic situation normalizes and for it she has paid the rent for five years.
Hira Jargha Magar, a handicraft manufacturer, is also suffering from less sales of his products. His Kathmandu-based firm, Maitri Craft Nepal, produces paper-based handicraft products.
"I have not been able to produce the handicraft products due to a shortage of raw materials amid the lockdown," he said. "As there is no cash flow, I need to pay my staff and the landlord for the renting space."
Small- to medium-sized enterprises (SMEs) have been heavily affected by the pandemic compared with larger businesses, according to surveys conducted by Nepal's central bank.
Even among the SMEs, those related to the tourism and hospitality sector have suffered more as they have to rely on foreign tourists while international travel has been largely put on hold for now.
In June last year, 91 percent of hotels and restaurants were shut down completely while 7.21 percent of them were partially operational during the lockdown. The situation had improved in April this year before the second wave of the coronavirus infections hit the country, according to a survey conducted by Nepal Rastra Bank, the central bank.
As shown by a follow-up survey done by the bank in April this year, 57.3 percent of hotels and restaurants were fully operational while 34.4 percent of them were partially operational before the country was plunged into another wave of the pandemic.
As to the SMEs, the central bank survey found 81.7 percent of small-sized and 74 percent of medium-sized enterprises were fully operational by April this year. When it comes to large enterprises, 90.5 percent were fully operational during the period.
"The SMEs have little resilience against the adverse situation. They also have to pay more interest for bank loans as the banks see greater risk for financing such enterprises," Dr. Govinda Nepal, a senior economist, told Xinhua. "So it is very important that the government needs to support the SMEs for their survival."
The Nepali government and central bank have offered two types of credit support to enterprises affected by COVID-19.
The government has launched a Business Community Credit Scheme to offer loans at subsidized interest rates to micro, small and medium enterprises and the tourism sector, while the central bank has been providing refinance facility to enterprises by reducing the interest rates for loans they received before the pandemic befell.
According to a study conducted by the central bank in 2016, the SMEs had created a total of 2.2 million jobs in the country with an estimated population of some 30 million.