| THIMPHU, Bhutan
THIMPHU, Bhutan May 28 Saffron-robed monks
wander the streets of Thimphu, where elaborately painted
buildings feature lucky symbols like tigers and phalluses, all
under the gaze of a huge gold Buddha atop a mountain overlooking
Bhutan's tree-lined capital.
Premium-paying tourists have long eulogised Bhutan's
unspoiled charms, its peace and its pristine environment, but
the Himalayan kingdom, famed as the "last Shangri-La", and for
using happiness to measure its success, is no idyll.
Its economy is struggling, with shantytowns emerging in
urban centres, packs of wild dogs roaming freely, and beggars on
Bhutan, wedged between India and China, spends far more on
imports than it earns, banks are cracking down on cheap credit
after a recent debt-driven spending boom, and youth employment
has surged to 9.2 percent as teenagers abandon farming for urban
The government is trying to cut the number of people living
below the poverty line to 15 percent of the population from its
current 23 percent, according to its own figures.
Encouraging more tourists would bring in cash, but the
government will not abandon its longstanding policy of limiting
visitor numbers by accepting only those who pay $250 a day in
"Bhutan will never be a mass destination," said Chhimmy
Pem, head of marketing at the Tourism Council of Bhutan,
formerly the Department of Tourism, which implements the
government's tourism policy. "Our target will always be the high
After paying for accommodation, travel, food and a guide,
$65 of that $250 goes to the government. The policy was adopted
to prevent tourism destroying Bhutan's unique Buddhist culture
and traditions, but some politicians say protection from the
outside world is no longer needed.
"Tourism was a real threat in the past, but that threat has
gone," Tshering Tobgay, head of main opposition group, the
People's Democratic Party, told Reuters. An increasingly
consumerist Bhutanese society, he said, is changing regardless
of the influence of sightseers. "It is us Bhutanese ourselves
who are now putting our traditions and culture at risk."
Bhutan adopted a "high end, low volume" tourism policy when
the reclusive nation first opened its borders to foreigners in
1974. That year just 300 visited.
In 2011, Bhutan welcomed around 64,000 people, according to
figures released by the Tourism Council of Bhutan this month. By
contrast, more than 600,000 people visited nearby Nepal in 2010,
official Nepali figures showed.
In contrast to Nepal and India, where backpackers who live
on a few dollars a day are welcomed, luxury resorts are more
Bhutan's style, attracting celebrities including Leonardo di
Caprio, Cameron Diaz, and Jack Nicholson, who can go unnoticed.
Management consultancy firm McKinsey was commissioned by
Bhutan to examine its economy, and recommended in 2009 that the
country should attract 250,000 tourists by 2014.
The government decided this target was too ambitious, and
instead wants to bring in 100,000 a year by the end of 2012.
Last year tourists paying in U.S. dollars contributed $47.7
million towards direct gross earnings, up 32.5 percent from a
Combined with visitor spending on extra services and
handicrafts, the Tourism Council estimated the industry
contributed nearly 10 percent of GDP in 2011, making it Bhutan's
second biggest earner. Power exports, mainly to India, account
for 40 percent of national revenue, and a quarter of GDP,
according to the Asian Development Bank.
Sonam Dorji, secretary-general of the Association of
Bhutanese Tour Operators, said early fears over the culturally
and environmentally destructive effects of tourism had faded,
but concerns over numbers had not.
"The tourists who come here are well travelled, and cultural
tourism is their major interest, so they travel to the villages
to see local festivals and stay in traditional homestays," he
said. "This brings money to local economies and supports these
traditions which could die out otherwise.
"But we just can't cope with much greater numbers. We
couldn't absorb them and provide a good quality service. We are
a developing country, but one of the least developed in the
world and I don't see that changing rapidly in the near future."
PROGRESS AND TENSION
About 70 percent of Bhutan's 700,000 population survives
through subsistence farming. Electricity and roads are yet to
reach all of the country, and the latest Gross National
Happiness survey, conducted in 2010, found only 41 percent of
Bhutanese were classified as "happy".
In an interview with Reuters in May, Prime Minister Jigmi
Thinley said Bhutan could not cope with the recent phenomenon of
debt-fuelled consumerism which has outstripped economic output,
forcing the government to cut spending and consider raising some
Bhutan has proudly marketed itself as the "The Land of True
Happiness" since its fourth king famously adopted a mantra in
1979 that a happiness index, rather than orthodox economic
indicators, was a better way to measure national progress. It
was not until recent years that Bhutan actually came up with a
way to measure this.
But Bhutan is a country in transition. The younger
generation is abandoning traditional dress in favour of jeans,
T-shirts and tattoos, and most young Bhutanese are on Facebook.
It is a major shift for a nation that only allowed
television and Internet access in 1999, and still bans the sale
This is the where the tension lies: tourists, so important
to the economy, enjoy the exclusivity of Bhutan, and they fear
that if the pace of progress increases, they may find the very
things that draw them there are jeopardised.
"There are no queues here and tourism has not left a mark,"
said American tourist Jennifer Logsdon, a human resources
executive from Boston who was enjoying Bhutan's ancient
monasteries and fortresses dotted across the country.
"Unlike so many other places in Asia, you are not hassled in
the streets here," said Australian holidaymaker Maryanne Paget.
As well as the cost, limited access has kept numbers down.
National carrier Drukair is the only airline which flies to
Bhutan, its planes leaving from Nepal, India and Thailand. Later
this year it plans to add another Indian route, and start flying
One change the industry in Bhutan does want is to make
tourism a year-round business, Sonam said, rather than relying
on spikes in tourism during major religious festivals in spring
and autumn, when costumed, masked dancers fill flights and
hotels. At other times, many hotels are empty and gift shops do
Still, foreign travel agents say Bhutan should be wary of
switching to an open-door policy.
"Bhutan still has that mystical appeal, and it would be very
sad if it compromised the policy that was designed to stop it
making the same mistakes as its neighbours," said travel agent
Charlotte Lawson from Britain's Steppes Travel, which
specialises in luxury and tailor-made trips. "It is an
extraordinarily special place and should stay so."
(Editing by Daniel Magnowski)