Government, Hoteliers Work Out Temporary Compromise to End Crisis

November 11, 2000
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Kathmandu, Nov.11: Amidst a tense atmosphere, government and hoteliers worked out a compromise Saturday evening to stave off a strike by hotel employees who threatened to go on an indefinite protest from November 19 demanding the compulsory slapping of a 10 percent service charge on all services.

Minutes before the end of a deadline by hoteliers who threatened to issue an international notice suspending services, Prime Minister Girija Prasad Koirala and hoteliers met and came to a compromise, sources close to the negotiations told nepalnews.com.

Government will announce the appointment of a high level committee to  resolve the issue of 10 percent service charge Sunday, another source close to the negotiations said.

Two unions close to the ruling Nepali Congress party and the Nepal Communist party( (Unified Marxist Leninist) are also expected to announce a postponement of the strike, sources said.

Hoteliers this week charged the ruling party and the  main opposition of inciting hotel workers to destroy Nepal’s tourism industry that earned $168 million in 1999 providing direct employment to 200,000 people.

Hoteliers said slapping the 10 percent service would be counterproductive while unions said they were ready to withdraw their demands if the tax hampered the industry; visitors already pay 12.3 percent taxes on all bills.

The Hotel Association of Nepal earlier charged the government of indifference to resolve the dispute.

Hoteliers demanded the government declare strikes illegal by declaring the hotel industry an essential service– a demand that the government was unwilling to meet.

Labourers threatened to go on a strike during the peak tourist season in Nepal when two British royals were to visit Nepal.

Prince Philip, the husband of Queen Elizabeth, is coming to Nepal next week to attend an annual conference of the World Wildlife Fund and Princess Anne, the daughter of the British Queen, is also visiting the Himalayan kingdom to inspect the work of a British NGO of which she is patron. nepalnews.com br