… GDP records at Nu 187.8B
Bhutan’s economic or gross domestic product (GDP) recorded a growth of 4.09 percent or Nu 187.8 billion (B) in 2021, according to the National Statistics Bureau’s (NSB) National Accounts Statistics 2022 released on Saturday, July 30.
The economy saw an increase by Nu 15.5B which is an expansion of 14.1 percentage points from 2020’s GDP growth of -10. 01 percent, equivalent to Nu 172.3B.
GDP represents the flow of goods and services because of economic activities that take place in the economy. It is the sum of the values of all goods and services produced within the economic boundary of the country, which is available for final uses such as consumption, investment, and exports.
An expansion of GDP results in the creation of jobs, and an increase in people’s income levels and consumption capacity. It also means higher profits for companies, including the government and corporations, which in turn means higher stock prices for some of them.
After the economic shocks from the pandemic, the mining and quarrying sector saw an expansion at 28.27 percent in 2021. It is a 108.69 percentage point increase after having observed a record low growth of -80.4 percent in the previous year.
Mines and minerals like dolomite, limestone, coal, and gypsum among others were the main contributors to the growth of the sector.
Transport and communication also grew at 16.21 percent from a low growth of -14.65 percent in 2020. Telecommunication was the major contributor which saw a growth of 27.31 percent followed by publishing activities and surface transport activities with 19.42 percent and 3.15 percent respectively.
As expected, air transport and travel activities sub-sectors recorded a drop in growth, with -73.28 percent and -72.07 percent respectively because of the challenges posed by the pandemic and border closures.
Lifting the restriction on the import of foreign workers, improved economic activity in construction and resulted in the construction sector growing by 8.78 percent after three successive years of contraction. Wholesale and retail trade saw an increase of 7.26 percent.
However, the electricity and water supply sector, financial and insurance activities, and education and health dropped by 3.69 percent, 4.16 percent, and 0.01 percent respectively.
Statistics also show that the gross national savings (government and private savings) saw a decline of 6.14 percent at Nu 26.4B compared with the Nu 28.8B in 2020.
Gross national saving is derived by deducting the final consumption expenditure from gross national disposable income and consists of savings such as personal, business and government.
“Increased government final consumption expenditure, and continuous decline in the inflow of primary and secondary income from the rest of the world resulted in the fall of the national saving,” the report stated. Unlike in the past years, gross national savings was not adequate to meet the investment requirements of the economy.
Export of goods and services increased by 8.92 percent and at the same time, import of goods and services also increased by 15.74 percent in 2021. This increased Bhutan’s trade deficit to Nu 39.3B in 2021, an increase of 27. 94 percent from a deficit of Nu 28.6B in the previous year.
Among the sectors, the tertiary sector recorded the highest share of the economy with 46.61 percent followed by the secondary sector with 34.2 percent, and the primary sector with 19.19 percent.
Similarly, gross national income increased by 4.1 percent, an increase of 11.24 percentage points at Nu 176.3B in 2021.
The GDP per capita increased to Nu 248,334 (USD 3,359) from Nu 230,055 (USD 3,104) in 2021. This is an increase of 3.1 percent from 2020.