A think tank constituted by ABTO submitted a report in this regard last week

Tourism: Highlighting areas of collaboration where tourism stakeholders can work together, the Association of Bhutanese Tour Operators (ABTO) submitted a comprehensive report to the government last week.

Titled “Bhutan tourism review and recommendations 2016” the report was prepared by a think tank constituted by ABTO. The think tank reviewed and analysed the current tourism situation and came up with several findings which ABTO used to compile recommendations.

The team began with an extensive desk review of policy documents with direct bearing on the industry besides gathering data and information from all key sectors of the industry.

The report states that the tourism industry appears to be at a crossroads with conflicting views and schools of thought as to how the industry should proceed especially with regard to the tariff structure. The conflicting needs and pressures of the growing industry has lead to a push for change while ignoring the continuity of the tested foundation of the unique tariff arrangement that has been the single most important unique selling point for Bhutan.

“The widespread opinion is that the existing tariff system is a tried and tested model that is best suited for the sustainable development of tourism in Bhutan,” states the report. “While the system warrants no change, improvements in governance structure, infrastructure and other operational aspects of tourism could help to effectively leverage  Bhutan’s ‘high value, low impact’ tourism policy.”

The report covers a variety of issues such as the tariff structure, marketing and promotion, lack of coordination and certification and monitoring, among others.


According to the report, the foundation of Bhutan’s tourism industry has been to achieve maximum benefits from fewer tourists and the high value tourism principle given the limited tourism resources and carrying capacity. “It noted that free-market conditions would lead to an uncontrolled growth in poor quality infrastructure and services as well as low yield per tourist,” it states.

If the current tariff system is done away with, the report adds that a larger volume of tourist arrivals would be required to reap the same benefits. This is expected to strain the tourism products to its limit and compound negative impacts that undermine its intrinsic values. It is pointed out that high value and controlled tourism with high yield per tourist is still the best option for Bhutan making it easier to manage tourism’s negative impacts in line with the country’s development principles, while also bringing in significant earnings.

However, to exploit the full potential within the given principles, consistent commitment and collaboration from the government and the industry is necessary. Efforts have to be made to put various vital but workable instruments and management systems in place to propel the industry to its optimal operational level without compromising the socio-cultural and environmental resources.

Rather than overhauling the tariff system, the report points out that it is vital that the industry rethink the structure, functions, and limitations of the government bodies associated with tourism and use the industry associations and stakeholders by outsourcing most functions to maximise results with minimal use of the country’s limited financial resources.

Collaboration & infrastructure development

The report also highlights lack of collaboration and a coordinated approach in promoting and developing the industry hence stagnating it from progressing to what it could have achieved even without considering changes. Although some plans and activities were developed keeping in mind the roles of the different actors, implementation of actions are most often isolated and compartmentalised not achieving the desired targets.

For instance, even the local governments have gradually started to take decisions without consultations or in conformity with national interests and it would hamper the overall operation and development of the industry.

In addition, the report also highlights issues of infrastructure development works like road expansion that are carried out without advance notice and consultation with the stakeholders. This was attributed to absence of a clear and defined short and long-term progressive paths laid down for the industry to move forward.

Lack of comprehensive, dynamic and latest authentic tourism data, the report states results in making improper decisions by the stakeholders. Such data and statistics are seen crucial for all planning purposes and further development of the industry.

The report states that tourism infrastructure including means of access to the country to immigration channels, airports, transportation, roads, routes, tourism sites, visitor friendly facilities and services, signage, rest rooms on highways, restaurants, entertainment houses, retail shops, and accommodation are a lifeline for a wholesome travel experience.

“A vast amount of money is spent on marketing and promoting the country abroad but it has not been equated with the development of infrastructure back home,” it states. “Putting the house first in order will go a long way towards tourism development since word-of-mouth is still one of the most important promotional tools.”

Marketing & seasonality issues 

Marketing and promotion carried out by different stakeholders, generally in isolation, is seen as an issue. “Some semblance of coordination exists only for major tourism fairs, which limits participation and impact,” the report states. “Better coordination and concerted marketing and promotion options should be systematically put in place to carry out better-planned activities and to target source markets.”

Seasonality is a reality that affects all destinations, which according to the report cannot be ignored nor addressed completely. Therefore, product diversification, specialised tours, special events and special offers are seen as necessary. Identification of comprehensive training needs for the industry, value chain not limited to just tour operators and the hospitality sector and innovative training modules need to be seriously explored and considered.

As a high value tourism destination, the process of certification and monitoring is an important component for tourism for which quality and standards have to be maintained.

It is highlighted that while some form of systems are in place, more importance and effort has to be made to put together an all encompassing certification process and monitoring for all activities catering to tourism. The report also highlights the possibility of outsourcing or bringing in credible third party inputs, while efforts could be made to encourage self-monitoring and maintenance of quality standards through performance incentives and awards of excellence.

Regional tourism, as per the report, will invariably be the destroyer or mainstay tourism in Bhutan given the huge outbound tourism potential and the spending power that India presents. The impact this will have on Bhutan and international tourism arrivals cannot be denied but a clear policy requires to be developed soon so that advantage can be taken of this potential.

Kinga Dema