Thinley Namgay

Incentivising businesses that comply with anti-corruption mandates and promoting business integrity are essential for driving the country’s economic growth.

This advice comes from experts.

Bhutan is facing an increasingly urgent need to focus on economic development, especially as it recovers from the disruptions caused by the Covid-19 pandemic.

One of its key objectives is to improve its score on Transparency International’s Corruption Perception Index (CPI), aiming to raise it from 68 to 73 points—a figure that has remained unchanged for the past six years.

As part of its 13th Plan, the country has committed to making the private sector central to economic growth. This will be achieved through a government-supported, private-sector-driven development model. The plan includes creating a conducive environment for business growth, improving access to finance, promoting entrepreneurship, and increasing efficiency across all sectors.

Under the 13th Plan, Bhutan aims to maximise its GDP, targeting USD 5 billion, increasing GDP per capita to USD 6,174, achieving full employment with quality jobs by 2027, and quadrupling the income of the bottom 40 percent of the population.

However, a significant concern is the potential risk of corruption in the implementation of these economic activities, particularly within the private sector, which is often regarded as the engine of growth.

Elodie Beth Seo, Senior Manager at the Anti-Corruption Division of the Organisation for Economic Cooperation and Development (OECD), highlighted that incentives can play a crucial role in fostering business integrity.

She suggested that companies prioritising ethical business practices could be rewarded with benefits such as tax exemptions, access to public tenders, and reduced penalties in cases of liability.

Elodie Beth Seo said that sanctions alone were insufficient to combat corruption. “A robust mechanism is needed, including innovative strategies, resource guides, and multi-sectoral collaborations,” she said.

Citing data from the U4 Anti-Corruption Resource Centre, Deki Pema, Chairperson of the Anti-Corruption Commission (ACC), highlighted that globally, bribe payments account for 5 to 20 percent of construction costs. “The Global Infrastructure Hub estimates that by 2040, the world will face an annual infrastructure investment gap of USD 435 billion in road transport and USD 164 billion in energy systems. These gaps are worsened by inefficiencies, fraud, and corruption, which erode trust,” Deki Pema said.

She also pointed out that investors globally are increasingly prioritising companies that adhere to business ethics aligned with Environmental, Social, and Governance (ESG) standards.

“More than USD 60 trillion in assets worldwide are reported to be managed under ESG principles, demonstrating the power of integrity as a business asset and its role in driving long-term value and resilience,” she added.

Deki Pema said that governments must create ecosystems where compliance is rewarded. “The modernisation of Bhutan’s asset declaration system, along with the introduction of the model code of conduct and integrity vetting systems, are vital steps in strengthening the national integrity framework,” she said.

Finance Minister Lekey Dorji reiterated that Bhutan’s goal is to become a high-income Gross National Happiness (GNH) economy by 2034. He stressed that economic prosperity must be built on a foundation of strong integrity, value for money, effective anti-corruption measures, and transparent legal principles.

Lyonpo Dorji further noted that the right policies, incentives, and unwavering commitment to integrity are essential. “The government’s Economic Stimulus Programme (ESP) will also play a key role in strengthening the economy,” he added.