June 18: The economic crisis in the country has started taking its toll on the advertising industry, which is currently is a state of disarray,

Businessmen say that the advertising industry of Nepal has reached on the verge of collapse following the outbreak of coronavirus pandemic and the Russia-Ukraine war.

In addition to the financial crisis, the government's failure to amend laws and timely reforms to make the advertising industry viable has also affected the industry.

Advertisers say that if the industry collapses, the general consumer will be deprived of public welfare information and the employees working in the industry and the media will be affected.

According to Nepal Advertising Association, 142 advertising agencies are registered with the association.

The president of the association, Som Prasad Dhital, said that the advertising market has slumped. Compared to last year, the market has dropped by 40 percent.

“Government policies, the role of the media, the reluctance of advertisers are the internal reasons for the decline in the market while the post-coronavirus recession and the Russia-Ukraine war are the external factors,'' said Dhital, adding, “The media started blackmailing the advertisers. They used to behave well when they got advertisements but they started abusing after not getting advertisements. This made the advertiser angry.”

According to the stakeholders, the advertisement of the construction industry and automobiles sector has come to a standstill.

Krishna Prasad Ghimire, Secretary General of Nepal Advertising Board, complained that despite the hope that the industry would grow due to the formation of the Advertising Board and various decisions of the government before the coronavirus pandemic, it did not happen in practice.

Businessmen were hopeful that the advertisement market would increase after the government's decision to implement the clean feed policy.

“We also thought that Nepal's advertising industry would take over the market of goods imported from outside. The formation of the Advertisement Board also gave hope to the businessmen," he said. "But the advertising industry is becoming unstable now.”

The commercial establishments which used to allocate Rs 10 million earlier are not even spending Rs 1 million now. Even smaller industries are backing away from advertising.

According to General Secretary Ghimire, there is also a situation where municipalities do not allow advertising boards.

"With such policies of the local government, the budget coming to this area has been cut by commercial establishments," he said.

Stakeholders said that advertisements of alcohol and cigarettes have been stopped now. The businessman said that advertisements of sex-related material, which were only available at night in the past, have now been stopped. According to them, there was an annual advertising market of Rs 6 billion in Nepal at the time, but now it has shrunk to Rs 3 billion.

Chairman of Nepal Advertising Board, Laxman Humagai, said that the process of amending the regulations related to advertising is now progressing.

“It is true that the advertising market has declined. We are making efforts to improve the situation. Work is also being done to attract advertisers to the advertising market," he said. "There will be some improvements when the law is amended."

President Humagai also sees the need for regulating social media.

"We are also lobbying to regulate social media advertisements," he said.