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Last Updated: Tuesday, 17 August, 2004, 06:36 GMT 07:36 UK
Rebels force Nepal firms to close
Soldiers stand guard outside Soaltee Crowne Plaza hotel
The Soaltee Crowne Plaza hotel is closed
A number of big businesses in Nepal have shut down following threats from Maoist rebels.

The rebels have ordered the companies to close indefinitely as part of efforts to pressure the government.

The move is in protest at the alleged exploitation of workers, the rebels say. The companies deny this.

Security has been tightened after a bomb attack in the capital, Kathmandu, forced the closure of a luxury hotel on Monday.

A leading tobacco company has said it is also preparing to close down because of the rebel threat.

The hotel did not tell us anything. We only came to know it was a bomb from the newspaper reports this morning
Eva Pereira
Soaltee Crowne Plaza guest

"We cannot take any chances about security," Rabi KC, an official of Surya Nepal Private Limited tobacco company told Reuters news agency.

The rebels have warned 11 big companies to close with effect from 17 August.

They have also threatened to block roads linking Kathmandu with the rest of the country with effect from Wednesday, in protest at the alleged repression of their supporters by government forces.

Blow to tourism

Tourists have moved out of the Soaltee Crowne Plaza hotel in Kathmandu after a bomb attack on Monday. No one was injured in the attack.

Soldier in Kathmandu
Kathmandu is under threat of a rebel blockade
The authorities suspect Maoists of carrying out the attack, after the hotel defied the rebel warning to close.

Correspondents say tourists left the hotel on Tuesday, and the hotel's main gate was closed.

"The hotel did not tell us anything. We only came to know it was a bomb from the newspaper reports this morning. We thought it was a storm," Eva Pereira, a tourist from Spain who was leaving the hotel told Reuters.

Narendra Bajracharya, chief of the Hotel Association of Nepal, said it was "unfortunate for the entire tourism sector".

'Serious consequences'

In a statement last week, the Federation of Nepalese Chambers of Commerce and Industry - an umbrella organisation of Nepalese entrepreneurs - called for an end to attempts to disrupt business.

The All Nepal Trade Union Federation - the labour wing of the Maoist rebels - had earlier warned of serious consequences if the businesses defied the call for a shut-down.

The rebels have been engaged in an armed struggle since 1996 to replace the monarchy with a communist republic.

Nine thousand people have died in violence between the rebels and the security forces since then. Violence has risen sharply after peace talks broke down last year.

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