Home > News > Stakeholders debate new tourism policy

Stakeholders debate new tourism policy

5 February 2010

 

 Most stakeholders express reservations about the new tourism policy which propos­es tariff liberalization and up­gradation of hotels in order to bring in 100,000 tourists by the end of 2012.

100,000 tourists a year would mean about 1,918 tourists a day supposing that a tourist spends at least one week in the country.

Stakeholders say they doubt whether Bhutan can accommodate so many tour­ists and whether all hoteliers can upgrade themselves to three star level.

With the government re­taining US $ 65 and mandat­ing tourists to stay in three star hotels coupled with extra cost on transportation, Bhu­tan would be more expensive, according to tour operators.

Opposition Leader Tsher­ing Tobgay, in his recent meet­ing

 with the Economic Affairs Minister, proposed a series of recommendations.

Calling the policy “ir­responsible decision”, he suggested that the govern­ment review its aspiration of achieving 100,000 tourist arrivals a year by the end of 2012, given that a 62 percent annual increase in tourist ar­rivals compounded over the next three years may not be sustainable or desirable.

Instead of liberalizing the tariff, he suggested that it be increased to US $ 250 a per­son for a night in accordance with Tourism Council of Bhu­tan’s (TCB) announcement of August 1, 2008.

The Hotel Association of Bhutan (HAB) has recom­mended the government to look into the basic necessities of improving services rather than upgrading the hotels.

 Tariff liberalization

“Tariff liberalization is something I would really like the government to reconsider. I hope the government con­siders it very carefully,” said the Opposition Leader. He said the government should look at the country’s absorp­tive capacity, population, and commitment to GNH.

While some hoteliers said that the figure might be a lit­tle unrealistic, some are look­ing forward to it in terms of higher occupancy.

The president of HAB, Ugen Wangchuk, said that, if the government could convince the hoteliers and tour operators that tariff lib­eralization could bring in 100,000 tourists in the next three years, there wouldn’t be any resistance.

Upgradation of hotels

The government will give 10 years of tax break for ho­tels established between 2010 and 2015.

However, the upgradation of hotels will take into ac­count only less than 80 per­cent of the hotels in the coun­try.

According to the Opposi­tion Leader, if the govern­ment approves only the three star hotels, rest of the hotels will not get the business.

Ugen Wangchuk said that, while HAB fully support the government’s initiative to im­prove the standard of hotels, there are reservations from certain quarters. Hotels in the rural dzongkhags have ex­pressed concerns to the asso­ciation that, having invested heavily in their existing prop­erties, they are already find­ing it difficult to service loans owing to low occupancy rate.

He said in order to encour­age upgradation, HAB has requested the government several tax breaks, financial incentives, and easy access to loans. The problem, he said, arises when the government mandates the hoteliers to up­grade their facilities. “What happens to those hotels that can’t upgrade? We can’t just leave them out in the cold.” Therefore, it was recom­mended that the government focused on service improve­ment.

Currently, there are 136 TCB approved hotels and 46 more are coming up exclud­ing the ones that cater to the locals.

For lodges and farm hous­es, the TCB will draft a sepa­rate quality control.

Implementation

According to the Opposi­tion Leader, the government cannot implement the policy of mandating tourists to stay in three star hotels without becoming a police state as it would be impossible to moni­tor where the tourists stay.

Nu 256 million tourism de­velopment fund (TDF) with ABTO and TCB has been allo­cated for destination market­ing this year. The Opposition Leader said one man cannot decide, unilaterally, on how the money will be used. “It’s wrong in principal and could also be illegal,” he said.

Employment generation

With regard to creation of 25,000 jobs in the tourism sector, Ugen Wangchuk said that, although a substantial number of jobs can be gen­erated, it wouldn’t be to the tune of 25,000.

A tour operator said that, considering that most tour guides are currently under­employed because of the seasonal nature of tourism in Bhutan, he doesn’t see many new jobs being created. To­day, there are about 1,300 tour guides in the country.

“We have been over sim­plistic that creating tourist number means creating em­ployment. But we already know that people in the tourism sector are underem­ployed. If tourists are spread throughout the year, the same number of people can handle them,” the Opposition Leader said.

Reservations

A hotelier in Bumthang asked whether he would have enough guests if he upgraded his hotel to three star level.

Association of Bhutanese Tour Operators wants the same old policy to continue. Tariff liberalization, upgra­dation of hotels, opening of new routes, and more domes­tic airports aren’t convincing enough, according to tour op­erators.

HAB has requested the gov­ernment to replace the word “mandate” with “encourage” in the executive order issued last year. We haven’t got the final word from the govern­ment but we hope it is looking into it, said Ugen Wangchuk.

The stakeholders are meet­ing with the Prime Minister on February 24 to discuss the issues. They are hoping that they can reach an agreement with the government.

According to Economic Affairs Minister Khandu Wangchuk, the need to in­crease the potential for Bhu­tan’s economic development besides hydropower lies mainly in the service sector in which tourism has been and will be a major sector.

He emphasized the urgen­cy to create employment op­portunities for the youth for which tourism needs to play a major and accelerated role.

“Given the current reces­sion, the target may appear on the higher side, but given the needs, the government is committed to work towards achieving both the targets in the stipulated period,” he said. “It will call for hard work and innovation from all stakeholders of this sector.”

By Sonam Pelden

Ratings: 1 Star2 Stars3 Stars4 Stars5 Stars
Loading ... Loading ...
Email this page Email this page     Print this page Print this page    

Posted by Chime · Filed Under News 

Comments

Leave your comment





Note: Comments are moderated by Bhutan Observer, and may not appear until they have been reviewed and deemed appropriate for posting.