What are other major changes?
The following are some of the major changes.
1. One tourism policy
The one tourism policy is to revitalize the policy of ‘High value, Low volume’ tourism, where all tourists coming to Bhutan will receive the same premium and exclusive services. Bhutan will re-brand as an exclusive destination and attract discerning visitors.
2. No Minimum Daily Package Rates (MDPR)
The Minimum Daily Package rate of USD 250 and USD 200 per night per tourist will be lifted and not applicable. The tourists will have more flexibility to choose the services and arrange their tour operations. The change will allow the service providers to offer innovative and competitive services.
3. Professionalized tourism service providers
The tourism service providers (tour operators, hoteliers, guides, and drivers) will be elevated and professionalized to provide exclusive services. Stringent standards for licensing and certification of tourism service providers will be introduced. Leveraging the economic makeup of our country, the tourism sector will engage youth in meaningful high skilled, and well-paid jobs and have the dexterity to navigate and excel in a rapidly-changing technology-driven world.
4. Digitalized systems to enhance services
There will be significant changes in the tour operations and service delivery. For instance, the visa application will be open, where individual tourists can apply and it will be 24/7. One-stop tourism online portal will be in place to cater to all services for tourists. Work is also being done on digital payment enhancement, including payment gateway. This has been a long-standing challenge for the tourism industry. With this, we hope to make digital payment easier and more efficient.
5. More access to other parts of Bhutan
There will be four land entry points – Samdrup Jongkhar, Gelephu, Samtse, and Phuntsholing, which will give everyone a good choice to explore other parts of Bhutan. All these places will have a dedicated tourist information center to support and facilitate tourists and those involved in tourism.
What is the rationale behind lifting the Minimum Daily Package Rate?
The system of MDPR was designed in the 1970s when the Government pursued the role of a private tour operator. It was like hosting a Government guest today. This served the purpose of where choices were minimal and there was no existence of private tourism players with no competition and choices. However, now after about 5 decades where everything has changed, it has become imperative that we take advantage of the benefits of choices provided by the existence of many service players in the market. We need to ensure that services meet the expectations of our tourists. The demands of tourists have changed and it has become sophisticated. We need to ensure that the system is flexible and more agile and provide a level playing field for everyone.
Some of the limitations of the MDPR are:
1. Discourages innovation and creativity as most stick to the minimum services.
Had to be paid in advance
Services such as accommodation, meals, and guides are fixed and pre-decided
2. Doesn’t encourage going above the MDPR and also cannot account for payment of more than $200/250.
Misunderstood as tourism levy (SDF)
Stakeholders gamed the system leading to revenue leakages, tax evasion, and making Bhutan a cheap destination through misuse of the MDPR and the various discounts
Not able to ensure value for money for tourists (e.g. a tourist actually pays USD 475 per day and lands up getting services worth USD 70 only.)
Pricing and services are not transparent
Discourages out-of-pocket spending for food, accommodation, guide, and transport as these are all pre-decided and pre-paid.
Tourists could not connect directly with service providers nor could apply for visas directly on their own.
The lifting of MDPR is aimed at addressing these issues and also facilitating creativity and innovation in the tourism sector to achieve the ultimate objective of making Bhutan a high-value destination.
What will be the roles of the tour operators?
Except for the mandatory requirement to process visas and accept the MDPR, everything else remains the same. With the lifting of these logistics responsibilities, the Tour operators can now dedicate their time and resources to professionalizing the tour operations and tour packages. There will be more opportunities for innovation – to think of newer and creative ways to package tour programs or to come up with newer products that will attract diverse interest groups. Now the tour operators can play a bigger role in crafting and promoting the products. The tourists can contact our tour operators directly with the awareness being created on tourists being able to book directly with a Bhutanese tourism service provider. A dynamic online portal is being developed for tourists to connect directly with the Bhutanese service providers and attractions, in addition to other features that will make choosing and connecting with the Bhutanese service providers easier.
However, the new system will not be able to accommodate the so-called briefcase tour operators.
How about the tourist guides? The concern is that many may go out of business given the sheer number of licensed guides available in the market.
In the new tourism system of High value, the role of tour guides will be most critical. Therefore the future tour guides will be professional and become the true ambassador of our country.
According to our records, pre-Covid-19 there were 3597 licensed guides, of which only 1300 were active for about 72,199 tourists. Therefore, the guides like the tour operators and hotels in Thimphu, Paro, and Punakha were in oversupply.
So, it was a fact that more than 50 percent of the licensed guides were already unemployed pre-Covid-19 and going forward because of the slow re-start of tourism even without the effect of the changes, the tourist arrivals will be gradual. This means the engagement of guides will also be gradual and besides the required number of guides will be much lower than pre-Covid-19.
The vision for future guides of Bhutan is really high. A Bhutanese tour guide for example should be able to not only elaborate on every aspect of our country, but also about other countries. For instance, a Congolese tourist should be able to learn about Congo including their language from the Bhutanese tour guide. The work on this vision has already been started by the Desuung Reskilling Programme.
Who are the high-value tourists or how do you define high-value tourism in the context of Bhutan?
I like to clarify that our objectives of ‘High value, Low volume’ are beyond revenue, meaning other objectives such as sustainable development, cultural preservation, promotion, spirituality, and wellbeing promotion are equally important.
With this backdrop, High Value tourists can be understood in two equally important contexts. First is the value in terms of the profile of the tourist. A tourist who is discerning respects the local nature and culture, who appreciates the authentic ways of life, who appreciates space, tranquility, self-fulfillment and rejuvenation, clean air, clear water, the highest unclimbed mountain in the world, and virgin forest.
Second in terms of the minimum spending. This is not at all being elitist, in fact, it is the way of the world. For instance, even my brother wants to visit the Antarctic, but he cannot because he does not have the money to sponsor his trip. And this applies to every one of us. We know the doors to heaven are open to everyone, however, one has to fulfill minimum merits to be able to enter heaven. Similarly, while everyone is welcome to visit Bhutan, some minimum criteria have to be fulfilled to be able to visit Bhutan. And one such criterion could be the minimum spending.