The pandemic has hit small to large enterprises from various industries in Nepal. An estimate of about 90% of the small and medium enterprises — contributor of 22% of Nepal’s gross domestic product (GDP) — have remained close.
Most recent government data showed that Nepal’s GDP saw a massive decrease in the 3rd quarter of the last fiscal year. The 4-month lockdown from March to July is foreseen to decimate the 4th quarter GDP. Based on the Central Bureau of Statistics data, at least 5 out of 15 sectors reported negative growth in the 3rd quarter. More sectors are expected to see a negative growth when the 4th quarter data is released.
The Nepal government did not declare a lockdown. However, coronavirus restrictions are being implemented, and COVID-19 cases continue to rise steadily. Businesses are getting very worried because of the plans to extend the current restrictions.
Both economists and businesses say that if businesses are not allowed to resume, the country’s economy may face a major setback that will result in an increase in unemployment.