Nepali Times
"We need to talk directly with potential tourists."

Ang Tshering Sherpa has been a tourism entrepreneur for close to 30 years, and in the airline business since 1993. He is chairman of Asian Airlines Helicopter, Skyline Airways and Asian Trekking. Ang Tshering spoke to Nepali Times about marketing Nepal directly to overseas clients and the domestic aviation industry.

NT: How has business been since the emergency?
Ang Tshering Sherpa: The emergency has had a negative impact-tourists are down by 60 percent. There many factors-the palace incident, 11 September, the security situation and the emergency. Of course, those tourists who have come know it's quite safe here. But those who haven't think the situation must be extraordinary for an emergency to be declared.

How have you been coping?
From time to time, we go abroad and meet our clients directly and brief them on the current situation. That helps lessen their fears. We tell them that though there is a problem, no tourists have been attacked so far. Some are convinced, they come. We have to send out a strong message through the government, the travel trade. The government should try harder with the embassies-many embassies don't update their websites, so they have six-month-old news up. Tourists look at this and hesitate to come.

Has your agency had any cancellations following the recent cases of extortion by Maoists?
There have been inquiries. International agencies are concerned, mainly those in the English-speaking countries, who tend to react quickly to news. In cases of extortion, the money should be returned to the tourists.

You've often highlighted the need for more airline seats.
A country's tourism depends a lot on its national carrier. Ours isn't strong, which makes the long-term development of tourism difficult. Royal Nepal is so weak, it is now reduced to flying in the regional sector. When it flew Europe, it brought in about 2,500 tourists a month-roughly 30,000 a year. If we want long-lasting tourism, we need another international airline run by Nepalis. As long as there's no competition, I don't think RA will be competent. I remember, when there were no other domestic airlines, Royal Nepal had a box outside its marketing office, where we had to drop our reservation requests. We didn't have direct access. If the staff felt like it, they would check the box. Even when we called by phone, they never responded, marketing heads never gave appointments. Today, they seek us out. Monopoly never improved anything. RNAC needs a strong competitor.

What about other international airlines?
We can't just depend on those. Quite a few came, such as Lufthansa and Dragon Air. But they withdrew after seeing no profit. Even Aeroflot, which has been looking to more profitable sectors, has withdrawn flights. Not only have the airlines disappeared, travel agencies have stopped promoting Nepal. Can we afford to sell Nepal on the basis of international airlines that might pull out any time? If an airline is run by Nepalis, as a joint venture or solely with Nepali resources, they'll be obliged to make it run.

Is anything happening in that direction?
The realisation is dawning on the travel trade sector. There are about 400 trekking agencies in Nepal, about 450 travel agencies, and numerous hotels-many empty. If a big hotel like the Hyatt invested Rs 50 million and got guests, it could earn that amount in five days. If a trekking agency put in Rs 500,000, and brought in tourists, it could get that amount back as profit from five groups. But whether it is local investment or a joint venture, the management should be handed over to outsiders.

Would people invest, given the history of the domestic airline industry?
There has to be a trustworthy, honest team. In Nepal, we've seen numerous examples where people have raised money, invested, but pulled a fast one. We need an efficient, honest management team. I'm ready to invest whatever resources I have.

How come Skyline hasn't had to implement cost-cutting measures as other airlines have-no staff lay-offs, no salary cuts?
When you run a business, you have to have a certain market in hand. If you don't, the commission agents will kill you. The agents should depend on the airlines, not the other way round. Otherwise, you might have to fly empty once you reduce the commissions. Most of Skyline's promoters are from the travel trade, so there is enough business to sustain it.

What do you think of the government's recent move to hike the fees payable by private airlines?
The aviation industry is in dire straits. The government expresses sympathy, but adopts stringent measures, doubling and tripling its fees. In the current situation, parking, landing and navigation fees should be reduced, but they've been increased. This makes it difficult for us to function. All airlines have requested that fees be reduced in this critical situation and have asked the Nepal Oil Corporation to be a bit lenient about dues.

What about the proposed subsidies for flights to remote airfields? (See Biz briefs, #91)
It is a good idea, but hasn't been implemented yet. The rural areas will have the facility. Since there's no subsidy now, we suffer losses. We can't even raise money for the cost of fuel, and so airlines don't want to fly there.

How is your helicopter division doing?
We were the first to bring in heavy helicopters in the early 90s. The MI-17 revolutionised the rural economy, enabling equipment for development projects and goods to be transported. We carry out rescue flights and transport expedition equipment. They've stopped flying in food supplies and there aren't many places to fly to owing to the security situation. Our job is providing relief to the people, but we can't just land anywhere. Insurance companies get jittery. It's difficult to fly even if we want to.

You have a chain of hotels in Khumbu. How is the situation there?
It's the safest place now, so most tourists coming to Nepal are going there. Hotel occupancy is good compared to other places, though of course not as good as in previous seasons. Prior to the slump in tourism, industrialists felt they were running the country, businessmen said the economy was based on them. Now everyone's sitting up and taking note that tourism is also an important sector. The government is feeling it, industry is feeling it, commerce is feeling it. The impact is being felt everywhere.

You actually studied to be a doctor, what made you change your mind?
I did for three years, and was all set to be a doctor. But the climate didn't agree with me. I grew up at 4,000 m, my college was at sea level. I was always falling sick. The doctor suggested I go to a medical school in the hills. I didn't want to be a doctor who was always sick. I thought I'd rather do business and joined the travel industry. For some time I worked as an assistant to Mike Cheney, a pioneer of Nepal's travel industry. Then I set out on my own.

(11 JAN 2013 - 17 JAN 2013)