Background

Nepal's tourism sector, despite its vast potential with a strong hospitality base, remains underutilized, contributing only 2% to GDP and employing 200,000 people. The COVID-19 pandemic severely disrupted the industry, slashing tourist arrivals from 1.2 million in 2019 to 0.15 million in 2021. After the slowdown of the COVID-19 pandemic, the sector is gradually recovering. However, meeting the country’s vision to attract 3.5 million tourists annually by 2032, as envisioned by Nepal Tourism Decade 2023-2032, which is three-fold of the current trend, appears challenging. Reaching this target will require enhancing tourism facilities along trekking routes and at key destinations, developing a skilled workforce, ensuring seamless connectivity to major tourist destinations, and implementing targeted promotional strategies.

The Sustainable Tourism Project (STP) - a joint project of the Nepal Tourism Board (NTB) and UNDP Nepal aims to revitalize Nepal’s tourism sector post-COVID-19 and support inclusive, resilient, and sustainable economic growth. The project will prioritize strengthening domestic tourism by improving infrastructure, enhancing affordability, promoting digital and integrated marketing, fostering public-private partnerships, and supporting inclusive business development to create a resilient, competitive, and sustainable tourism economy in Nepal. STP focuses on three core outputs: improving tourism facilities along three major trekking trails to enhance community livelihoods; boosting employment and enterprise development for disadvantaged groups; and increasing tourist inflow through policy advocacy, digital innovation, and strategic marketing.

Summary

The project aims to elevate visitor safety, security, and satisfaction through improved tourism facilities while simultaneously creating income and employment opportunities for local communities. The project intervention is expected to upgrade three major trekking trails and enhance a range of tourist services, promote emerging destinations, build local capacities, and digitize tourism services. These measures are expected to foster inclusive, sustainable, and resilient economic development by creating tourism-based employment opportunities for poor, vulnerable, and marginalized groups including women, youth, LGBTIQ+ people, and persons with disabilities, capacity development of the tourism sector workforce, standardization of tourism services, adoption of digitization, and promotion of Nepal's tourism sector. The STP project envisions an integrated approach that strategically leverages resources from both public and private sectors as parallel funding to achieve the strategic priority output.

Additionally, the project fosters digital innovation in Nepal’s tourism sector by integrating the development and or promotion of digital tools and technology like mobile apps, virtual tours, and data-driven dashboards. It empowers startups through provincial boot camps, promotes e-learning, and enhances destination branding, all aimed at improving visitor engagement, SME competitiveness, service standardization, and evidence-based decision-making for sustainable tourism growth.

Ensuring national ownership and developing an exit strategy the STP project fosters long-term sustainability and community-led growth in Nepal’s tourism sector.