Starry-eyed plan

Almost all your comments on “Visiting tourists” expressed concern about the Prime Minister’s executive order to prepare a blueprint to do away with the minimum tourist tariff. The poll asking, “Should the minimum tariff for tourists be removed?” drew a similar response with 82% saying “No!”

Thank you for your comments. As promised, I’ll share your views with the government.

Today, I wish to draw attention to another blueprint that the Prime Minister has ordered. In the same executive order (of 13 November 2009), the Tourism Council of Bhutan was directed to constitute:

A cross sector implementation team consisting of the MoEA, MoF, TCB and ABTO to frame and present the blueprint for … Mandate all hotels catering to tourists to upgrade to at least 3 Star category.”

The idea, ostensibly, is to ensure “high value tourists” even after liberalizing the minimum tariffs by forcing them to stay in expensive hotels.

But how would we monitor that tourists, who will no longer be required to use tour operators, are actually staying in 3 Star hotels? How could we do so without becoming a police state?

Will all hotels currently catering to tourists be willing and able to upgrade to at least a 3 Star category? What will happen to those that are unable to upgrade?

And, what will happen to the guest houses in Bumthang? Where would tourists stay when they visit Bumthang? Where would tourists be allowed stay when they travel almost anywhere outside Thimphu and Paro?


Facebook Comments:


  1. I really hope that there;s some kind of economic , financial or cost- benefit analysis done when important decisions such as these are made. Not only that .. I hope that the distribtional and equity factors are also addressed.

    we should reeally like to see some real numbers and why it sis beneficial to liberalise toursim.. like what revenue forecast we are talking about, how many toursit we are targeting and how is that good for our country and how might we still be able to offer ” high value , low volume” principle or are we changing that?
    When we say upgrade the existing hotels to 3 stars, what standards are we talking about. How much money is it going to cost the owner and what financial assistance will be provided for the hotel owners in the East?
    How will Merak and Sakteng that PM mentioned as a tourist detination meet those requirements? or one month from now that Hilton or Hyde or whatever those hotels are… might be coming to Bhutan? Because we never know what to expect anymore….

  2. Ugyen Tshering says

    Is there any baseline, homeworks or researches done in consultation with the key stakeholders whilst the parliament hook onto changing legislatives/orders and covenants on whose plate rests the BREAD of thousands?

    Democracy could be pardoxical sometimes. The lives of thousands rest on the decision of a group! There should be proper reference specially with the masses prior to introducing alterations and innovations!!!

    Dear OL,
    i am blogging for the first time in the domain of your interactive website. i came to know about your web through my colleague. I personally think that this is an effective interactive forum, where the comments and thoughts of masses are taken into consideration, but only if pertinent issies be positively be raised and let known. Congrats! your forum can give voices to some who do not have a proper channel to raise concerns. I as a citizen of this Drukyul, once again convey my deepest sincerity and appreciation to this earnest effort of yours.


  3. Ofmountains says

    PM is encouraging Bhutanese/hoteliers to upgrade and seriously get into business. The theory of demand and supply coexist and surely this is right the way forward. We can not wait for development but we must work hard and take a lead role. He is blessed and elected/chosen to lead the country forward and he is doing it.

    PM is not saying to shut down business if they can not upgrade but guiding to look forward and take active participation in the development process.

    By the way Bhutanese are accustomed to blindly oppose things without doing any analysis on the subject.


    Likewise our OL and hidden PDP members, NC, media and general public deserves due credit for their hard work to achieving vibrant democracy.

  4. thongnangchen says

    I think Tashi has lot of questions to ask the govt. and I do respect his concerns. Like Tashi the other 700000 odd citizens also have questions to ask. But what if all of us only ask and demand. Human desire is unlimited and there is a hidden agenda behind every question raised and every word uttered. Try to imagine being the PM for a day yourself. Uneasy lies the head who wears the crown…. sums up all. It is easy to ask and comment but a differnt thing to quench the thirst for greed of kinds of people.

  5. Dear fellows,
    Did the local travel agents have a problem till date with the tariffs or did tourist complain. Yes! they might have but still the consistencies in the number of tourist are there unlike to the seasons.
    Today, after much of years of our new government, why is it that they try to overtake us with our any concerns. I think no local travel agents complained.
    Is the government trying to help us or ruin us?
    In stead of helping the agents by rather lowering the royalty why liberalize the tariff when all is going well.
    I guess its quite far that the stakeholders of such institution taking us for a ride…
    Rather trying to creating problems by wasting time where there is no problem with the system liberalizing it would be worth to liberalize the discussions or power in a democratic country.
    I guess in Asia we are one of the highest revenue earner through the tourism industry though the number of incoming is limited.

  6. Those questions that I ask are fair enough anf something that the Govt. should have answers too. I didn’t mean to oppse anything. i am concerned… and I believe that this are important issues to address before making a policy change or implementing a new on ein the country. We have time and again said we want to learn from the mistakes that the rest of the world made…more confidently we have claimed to teach countrie around the world how to be happy….
    And these are values that i value the most.. I value that the Govt. Don’t make some rash decisions that cannot be implemented in the end or that make the people suffer. I totally agree that to be a PM is a hard job….. and that’s exactly why his decisions have to be thought through.I still believe there has to be a economic analysis done on every policies that are made…..
    And our MPs should be able to read into these analysis and come up with the best alternatives that will benefit the country.

  7. Actually on second thoughts… being PM is not so hard… lsiten to people and think about what would be best for them and then go about doing what you can…….. I think we are not that big as a country…. to understand what those benefits might be…… visit parts of Bhutan more than abroad…. and when NA is in session – make that the most important priority… Most importantly…. make sure you say what the other Ministers says too..and don’t make up speeches while speaking ..and the most important MEAN WHAT YOU SAY!!!!!!some of us do that all the time !!!!

  8. thongnangchen says

    Points well put forward but far from convincing. Not all points can be valid, not all wishes can be realised and not all kidus can be granted. It takes time for the human mind to nurture and wisdom does not come in a day. I give due recognition to those men with wisdom nurtured and tested over time. I do not mean that I am for liberalisation but neither would I oppose just for the sake of opposing. Reading in between the lines of executive order indicates some logic and reasoning as well. Lets nuture our young minds like chewing doma in a cold winter morning. Meanwhile I have already digested some of Tashi’s points with a glass of lemon juice. Let us listen for others to express their views too. We have had our share.

    • lemon juice or not….. i think you didn’t get the point…. and you never will.. its the like of you who don’t understand, and my points were neither directed nor meant for you….. i will speak on this forum as much as i like and i ignore things that don’t seem important to to… you can do the same…. instead of putting names and getting personal

  9. The proposed tourism policy would adversely affect our nation’s pursuit of GNH. Beside the serious threat to our fragile culture and environment (two important pillars of GNH), it will probably create an unhappy dog-eat-dog society, similar to Nepal. Also what about the visionary policy of responsible tourism? To me, liberalizing tariff seems be going against the grain of what our philosophy of tourism has been so far. Everything we have done in terms of marketing and building a unique brand image will change.

    As we all know, tourism is a very sensitive industry. We are dealing with people and their feelings all the time. If we are not careful, in this interconnected world of internet, blogs, twitter, facebook, u-tube, citizen media, and online forums, it will only take few negative articles and comments from some irresponsible and unhappy tourists to damage the whole industry.

    Bhutan attracts world-wide attention because it is different. Different in our way of life, our culture, religion, environmental policy, governmental practices, standards of honesty, the pace of life, and development philosophy. The public face for all this is the tourism industry. If the tourism industry starts to copy the low quality, mass produced practices of Nepal and the rest of Asia, the precious sense of differentiation will be lost forever. Bhutan will become just another forgettable place in the world, grubbing for the dollar.

    Thank you for your time and for reading my concerns.

  10. I think the authroties of Tourism council doesnot like Bhutanese being successful. The unwaranted unscrupulous act by tourism authorities to subdue the stake holders instead of supporting and promoting them is a sign of just wanting to defame everyone who are continuously working hard to succeed. By liberalizing the tariff, we are in the long run inviting outside players in hotel business or to make tour operators as commission agents.



  11. I agree with you Kesang that our kids have to eventually live here and it is our collective responsibility to preserve Bhutan for what it is now. We can certainly appreciate the initiatives of the royal government for all teh good initiatives of liberalizing teh bottlenecks and removing the barriers of all the hassles of permits to conduct easy good business. The tought of liberalizing tariff for promoting MASS TOURISM is really bad for our country. We will be flooded with cheap tourism and the net worth that all teh stake holders like tour operators, hoteliers, guides, transporters, handicrafts vendors etc etc will get will be much much lower than what it is now. Where will the desired expenditure come from if we are promoting budget tourism. TCB can claim that backpackers will not come but when we are charging just the royalty – there is no gurantee that the state holders or various operators will not succum to cheap deals for want of business. We cannot compromise our country today for want of mass tourism. Slow and steady should be the answer to our needs since we are all Bhutanese and we all have to live here forever. Tourists will come and go but we are here to stay.

    The poll run by OL speaks volumes and we should heed to that. There are, I believe, enough bloggers out there who are viewing this post and responding accordingly and we should not ignore this.

    I am a mother of four and I am constantly telling my kids the values of life and constantly telling them how fortunate we are to be living in a country like BHUTAN that is so well preserved by our Kings and leaders of the past. Their tourism policy of high value low volume was very sound and it is indeed bringing in the desired numbers on a steady basis. What si the rush now to try and increase teh volume to 100,000 + at the count of our precious country.



    Tourism Investigation & Monitoring Team

    A growing alliance of citizens organizations and movements in the South and the North are fighting the current system of globalization that primarily serves to strengthen the power of big corporations and obstructs efforts to create a socially just and ecologically sustainable world.

    However, the self-proclaimed ‘world’s biggest industry’ called tourism has largely remained unchallenged in this global struggle, although it has contributed considerably to the deepening crises of poverty and debt, environmental degradation, cultural dissolution, exploitative labour, eroding democracy and human rights abuses. There is little recognition that the corporate tourism industry – more than probably any other industry – is not only an expression of globalization but also one of the most powerful driving forces towards progressive liberalization of the global economy that creates far more losers than winners the world over.

    Tourism is the ‘world’s biggest and fastest growing industry’: this is a cliche that is being repeated by all tourism players and the media like a mantra. Indeed, a whole global army of people and agencies has been mobilized to engage in relentless ideological and promotional work to persuade the world that tourism is the most magnificent phenomenon of our times, so all efforts must be directed towards making this industry grow without restrictions. It is this dominant doctrine envisioned by the STRONG tourism lobby, which needs to be exposed and opposed as part of the neo-liberal game that is being forced upon us.

    Ironically, while tourism is undoubtedly one of the biggest money-spinners today, its economic value for large parts of the developing world has been seriously questioned. There are also the high social and environmental costs of tourism that are not calculated in economic balance sheets. The industry is known to be particularly deceptive because it is almost completely controlled by large foreign companies based in rich tourist-generating countries, so a large proportion of the tourist dollars either never reaches developing host economies or inevitably flows out in the form of repatriated profits and other payments. Even the World Bank and the World Tourism Organization (WTO-OMT), which have both encouraged many countries to rely on tourism as an economic growth strategy and a means to boost their foreign exchange earnings, acknowledge that added revenues from tourism undergo substantial “leakages”. Several academic case studies suggest that in small economies, the capital outflow can be higher than 80 per cent of tourism receipts. An independent research by Louis Turner and John Ash noted already a quarter of a century ago that: “It may be odd that tourism, this brash modern industry, can be economically valueless – or even disadvantageous – to economies based even on virtual subsistence-level agriculture. But it can be true.”

    What happened that travel and tourism have nevertheless gained unprecedented importance in terms of both wealth and power? How come that even before the Uruguay Round of trade negotiations, tourism had emerged as the most centralized and most liberalized economic sector and that under the system of the General Agreement on Trade in Services (GATS) and the World Trade Organization (WTO-OMC), more liberalization commitments have been made in tourism than in any other sector?

    One explanation is that the richest travel and tourism corporations have established huge international alliances and networks – consisting of global and regional business associations, foundations, research centers, institutes, publication agencies, etc. – to jointly push their ideas and interests at all levels. It is also noteworthy that the UN-affiliated WTO-OMT is the only inter-governmental organization that allows membership by the private sector. According to a recent WTO-OMT statement, the members of its Business Council (WTOBC) “have become more active and more vocal” in the organization’s meetings and programmes (see appendix).

    Due to the heterogeneous nature of tourism, another outstanding feature of the tourism industry is cross-sector mingling – e.g. with the financial sector; the telecommunication sector; the construction, automobile and aerospace industries, the advertising and public relation industry. A good illustration is that members of the highly influential World Travel and Tourism Council (WTTC) consist not only chief executive officers of large hotel chains, tour operators, airlines etc., but also CEOs from heavyweights like American Express, Microsoft, PriceWaterhouse Coopers and Rolls Royce.

    Big tourism-related companies are strongly represented in the World Economic Forum (WEF) – a very powerful and unaccountable body where global political and economic policies are often fermented. The WEF also played a key role in initiating the GATT and WTO-OMC. So it is no coincidence that at its 2000 annual meeting in Davos, Switzerland, the WEF gave special backing to tourism “as a contributor to global prosperity”.

    In addition, corporate industry lobbying for tourism promotion has been extraordinarily successful at supranational governance bodies such as the Organization for Economic Cooperation and Development (OECD), the World Bank and the International Monetary Fund (IMF) and the WTO-OMC. As tourism provides the logistics and the physical infrastructure for freer movements of people and goods across the globe, governments of developed countries and international institutions regard this industry as a particularly effective instrument to break down national barriers to achieve free trade in goods of services, free circulation of capital and freedom of investment in general.

    According to a WTO-OMC report, the great level of commitments in tourism under the GATS reflects the “desire” of most countries to expand their tourism industry and to increase inward foreign direct investment (FDI). But this is not the full story, considering the way governments of developing countries have been bullied to adopt the rules of the neo-liberal tourism order. In particular, countries that have been pushed into structural adjustment programmes (SAPs) by the IMF, have little choice but to deregulate and liberalize the travel and tourism sector, despite increasing recognition that there are many disadvantages.

    For instance, most of today’s FDI in tourism is not devoted to new job-creating investment but to mergers and acquisitions, which pave the way to growing monopolies. Predatory big corporations are rapidly snapping up local tourism-related firms. This invariably results in a massive transfer of wealth to foreign corporate hands and heavy lay-offs, leaving local tourism entrepreneurs and workers on the pavement. A 1998 UNCTAD report states: “The number of small independent and family-run hotels is falling, while the accommodation offered by hotel chains is growing rapidly.” So the widely accepted argument that tourism stimulates local business, generates employment and, thus, increases the standard of living of people worldwide is – more than ever – disputable and needs to be reassessed.

    Developing countries are increasingly forced to sell cheap because of the limited capacity of local tourism-related businesses to negotiate profitable prices for their services. According to the UNCTAD report, large foreign tour operators “often exercise monopsonistic power over the local tourism suppliers”, and “the asymmetry of bargaining power is clearly revealed” in the content of contracts with local hotels, which usually contain various conditions favourable to tour operators. For example: “a substantial discount on the room price is provided; no deposit is required for the booking; payment may be made long after departure of the clients; and the tour operator retains the right to return unfilled rooms (“release back”) shortly before the arrival date, without any need to pay compensation.”

    SAPs and corporate efforts are directed towards getting governments in developing countries to establish policies that promote the privatization of tourism-related state enterprises (national airlines and transport companies in particular), safety in law for foreign investment and non-intervention in companies’ decision-making processes. This means that governments will be more and more unable to control and plan tourism on their own terms for the benefit of society and the environment. Their role will be restricted to making available public goods that the private sector cannot provide and to ensure political and economic stability to protect the wealth and hegemonic interests of foreign corporations. If countries do not make these necessary structural adjustments to allow the tourism industry to grow, they are threatened to be left behind on the sidelines as existing foreign companies will relocate elsewhere and no new FDI – tourism-related and otherwise – will come in.

    Although aviation liberalization has been considered by many developing countries as a threat to their continued participation in international air transport, big industry has been using all means to get governments to adopt “open skies policies”, saying protectionist aviation policies would severely constrain the development of tourism and pull potential customers away from hotels, resorts, car rentals, computer reservation systems, entertainment and all the rest of the industry. The WTTC claims the gross receipts from hotels and other tourist activities are substantially greater than those of national airlines, and foreign exchange leakages are proportionately much less.

    Despite the tremendous pressures towards more tourism and aviation liberalization, however, the recent negotiations on trade in services at the WTO-OMC indicate that there is no effective commensurate benefit to the developing countries from the liberalization commitments of the developed countries in the service sectors such as travel and tourism. There is growing awareness that developing countries that are tourist destinations have been pressured to make concessions without effectively getting any in return. In fact, bringing the agenda of tourism liberalization into the WTO-OMC has itself caused imbalance, and pushing developing countries to undertake obligations on liberalization in tourism-related services has resulted in further inequity in this sector.

    Some trade experts have suggested that if developing countries are unable to block further negotiations in services, they should refrain from making further market opening commitments or restricting their right to autonomous actions in schedules at the GATS/WTO-OMC.

    In view of all this, there is an urgent need for greater and more effective monitoring and regulation of travel and tourism as the ‘world’s biggest industry’ that affects the livelihoods and well-being of many millions of people and contributes to environmental degradation at global scale.

    Many parties concerned with tourism have been involved in efforts towards “better sharing the benefits” of globalization through the development of grassroots-oriented tourism. We are all for people-centred projects, but there are good reasons to argue that these are bound to fail if the macro-economic climate is detrimental and even hostile to those goals. In other words, there is no place for a fairer and more sustainable tourism in this world under corporate rule, and viable alternatives will never thrive where a globalized economy controlled by a minority dictates its rules to local societies. Hence, the corporate tourism industry and other concerned institutions must first fundamentally change their role and vision.

    The United Nations can play a crucial role in effecting positive change. For the UN, the goal should not be partnerships with the world’s largest tourism companies and associations that are set to override the sovereignty of nations at the cost of an increasingly marginalized majority of resident people. UN and affiliated agencies – the WTO-OMT in particular – need to be stopped from providing image-enhancement services to the industry (e.g. through promotional campaigns, such as the International Year of Ecotourism 2002, which are likely to accelerate the corporate take-over of nature, cultures and people). Rather, they must be taken to task to help counter-balance the dangerously increasing power of corporations by providing programmes that prioritize human needs and rights and a healthy environment over commercial tourism interests.

    The right way to go for non-governmental organizations and citizens focussing on tourism issues is to become part of the burgeoning people’s movements that are fighting to remove the ill-effects of globalization and corporate rule at local, national and international levels. If we join the worldwide ongoing civil society efforts to bring about new policies, which restore the power of communities and democratic nations and remove the sources of injustice, inequality and conflict in general, there is a real chance that the fundamental problems of tourism will eventually be tackled.

    The time has come to launch a global Campaign On Corporate Power In Tourism (COCPIT), which aims to profoundly challenge the biggest players in this industry and their drive towards globalization, while it supports tourism-related people’s struggles for human rights, democracy, economic equality, social justice and ecological integrity.

  13. KUENSEL NEWS:Liberalised tariff+ highend tourism ( ABTO meanwhile asks government to reconsider)

    28 January, 2010 – The Tourism Council of Bhutan says that the new liberalised tariff system is meant to not only increase the number of tourists to 100,000 in the next three years but also have more high-end tourists.

    TCB officials said that the current USD 200 dollars was supposed to be a minimum price introduced in 1989 but in reality most tour operators provided everything within or lower than the package.

    According to TCB this ‘minimum glass ceiling’ has become a ‘glass trap’ with no incentives and competition for tour operators or hotels to improve and tourists had no say in where they would stay, how they would travel or even eat as everything was pre decided by most operators within that package.

    Under the new system apart from the liberalised tariff tourists will have a say in the packages. “The government is very clear and will remain with high value and low volume tourism as all tourists will have to stay in three star hotels and have a guide,” said the director general of TCB, Kesang Wangdi.

    He also said that Bhutan currently had the lowest tourism density of 0.06 in comparison to 22 other similar countries and even with 100,000 tourists it would still have 55 times lower density then the next lowest density country.

    He said that the main aim of the government was to create 25,000 jobs and more revenue by spreading the tourists across Bhutan through all seasons offering multiple packages compared to the 96 percent culture package right now.

    “Liberalised tariff is just one of the many initiatives like destination marketing, improving aviation, more supply of hotels, upgrading of hotels to meet the objectives,” said the joint director of TCB, Thuji D Nadik. He said that Bhutan was already open to the outside world with around 40 TV channels and any increase in tourist’s number would not have an impact. He also said that monitoring would be strengthened especially once the tourism bill becomes an act.

    Meanwhile the hotels have had a mixed reaction with many supporting a liberalized tariff but few others objecting to the move. The president of the Hotel Association of Bhutan, Ugyen Wangchuk said, “a major concern is that all tourist hotels have to upgrade to a three star which would mean around Nu 4 million in investment and so we are asking for easy loans and tax breaks”.

    However, the Association of Bhutanese Tour Operators (ABTO) have submitted in writing to the Prime Minister their objections on liberalising the tourist tariff.

    ABTO says that there has been a 35 percent growth in tourist arrivals since 2004, which will lead to around 91,793 tourist arrivals from the current 27,636 by 2013 at the same tariff.

    ABTO also says that there would be an influx of budget travelers, local culture and behaviors would be impacted through the “Demonstration Effect”, infrastructure would be challenged and there could be unhealthy price competition bringing lower yield from tourism and decrease in quality despite increase in volume.

    It has instead submitted that other current measures like development of domestic airports for example would help meet objectives if properly implemented. It suggests a tax breaks for tour operators so that the money can be reinvested in tourism. It also suggests strengthening linkages between tourists and villagers for better resource distribution, more awareness among all stakeholders and better monitoring to be put in place before liberalization as currently requirement like proper office space for tour operators and equipment for trekking are not enforced well.

  14. A definite no from guides on tariff liberalisation BY KUENSELONLINE.

    Lack of information and consultation raise the fears of guides
    31 January, 2010 – The Guides Association of Bhutan (GAB), which represents the country’s almost 1,300 guides voted against the policy to liberalise the existing US$ 200 tariff that Tourism Council of Bhutan proposed.

    The decision was a unanimous one from all 102 GAB members who were called for a meeting to discuss the policy yesterday. Voting forms were distributed among other guides to deliver for those unable to attend.

    GAB executive members said the association was in the dark regarding the government’s plans and policies.

    “There is a lack of information and consultation from TCB’s side,” Sherub an executive member said. “Our main source of information has only been the media while we have been mainly consulting with ABTO.”

    Another member, Jimba said they had a brief interaction with TCB which was neither enough nor substantive.

    Besides the lack of transparency, members pointed out that guides were left out during any consultations.

    While the members agreed with the governments plan to have a guide for every tourist, they cast their doubts of what was happening in reality.

    “There is a danger of cab drivers and people hired by hotels posing as guides without licenses,” Sherub said. “This will lead to the Kathmandu situation, where guides hang around tourist sites, soliciting them.”

    GAB members also expressed their doubts over TCB’s ability to monitor the ground situation in the face of increased tourist numbers.

    “The problem exists even today where TCB is unable to monitor basic things like quality of hotel rooms, food and guides without licenses,” Tashi, another member said. “So how would they be able to deal with big numbers.”

    Mindu said that even with an increased number of tourists visiting the country the guides would still earn the same income, as prices would reduce.

    Sangay Dorji said TCB’s current guide training courses were inadequate as they were conducted only once a month, which was too short a duration to produce quality guides. “There could be a problem in the number of guides to deal with increased tourists,” he said.

    Tashi complained that the guides, who were neglected so far both by Bhutan Chamber of Commerce and Industries and Association of Bhutanese Tour Operators, were being informed, out of the blue, at the last moment on the tariff issue. “ABTO is getting closer to us only because of this tariff issue which could hurt them more,” Tashi said, “Earlier they were not supportive of GAB at all.”

    GAB member also said the tariff liberalisation should be the last option in its attempt to bring in the required number of tourists.

    Guides also raised the specter of harm to the country’s culture from excess tourists.

    TCB’s Joint Director Kunzang Norbu said they consulted the GAB members to discuss these issues and would continue to do so until it was resolved.

    By Tenzing Lamsang

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