Eastern Bhutan Circuit 1: Tourism Development Plan Mongar, Lhuentse, and Trashiyangtse
DRAFT
Beyond Green Travel LLC
Table of Contents List of Abbreviations ...... 4 Executive Summary ...... 5 I. Introduction ...... 17 a. Bhutan in the Global Tourism Market ...... 17 b. Purpose and Scope of Work ...... 20 c. Methodology ...... 21 d. Market Analysis and Age Demographic ...... 23 e. Gender and Vulnerability ...... 25 f. Strategy Overview ...... 27 II. Introduction to the Circuit 1 Eastern Dzongkhags of Mongar, Lhuentse, and Trashiyangtse ...... 27 a. Introduction to the Provinces ...... 28 Mongar ...... 28 Lhuentse ...... 30 Trashiyangtse ...... 31 b. Additional Demographic Information on Eastern Provinces of Mongar, Lhuentse, and Trashiyangtse ...... 33 c. Economic Participation and Employment Opportunities ...... 34 d. Tourism Visitation ...... 38 International visitation to Mongar, Lhuentse and Trashiyangtse ...... 39 Regional Tourist Visitation to Mongar, Lhuentse and Trashiyangtse .... 41 Current Available Accommodations in Circuit 1 ...... 42 e. Eastern Circuit 1 Products ...... 43 f. Eastern Circuit 1 Market Value Chains ...... 46 g. Tourism Stakeholders in Circuit 1 ...... 47 III. Developing a Tourism Economy in Eastern Bhutan ...... 49 a. Circuit 1 SWOT Analysis ...... 49 b. The Importance of Tourism Development in the East ...... 50 c. Current Tourism in the Circuit 1 Dzongkhags ...... 51 d. Assessment of Challenges to Tourism Development ...... 53 Institutional Structure ...... 53
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Overland Access ...... 54 Access by Air Transport ...... 56 Standard of Lodging and Accommodation...... 57 e. Sustainable Tourism Development in Eastern Bhutan: Contextual Development and Differentiation ...... 62 Adventure Travel ...... 63 Art and Spiritual Tourism ...... 64 f. Seeking a New Travel Demographic: Adventure Travelers ...... 66 g. Seeking a New Travel Demographic: Millennials ...... 67 Characteristics of the Millennial Traveler ...... 68 h. Liberalizing the Tariff Policy ...... 71 i. Issues of Gender and Vulnerable Populations...... 74 j. Other Barriers to Tourism in the Eastern Circuit ...... 81 IV. Review of Circuit 2 Development Plan and Implementation Strategy ...... 82 a. Socio-Economic Profiling of the TPS Circuit ...... 84 b. Destination Situational Analysis ...... 85 c. Product Development Strategy ...... 87 d. Tourism Marketing Framework ...... 90 e. Organizational Framework ...... 92 f. Tourism Investment Framework ...... 93 g. Tourism Implementation Strategy ...... 95 h. Local Stakeholders Response to the Circuit 2 Report ...... 95 i. Strengths and Weaknesses of the Circuit 2 Tourism Development Plan ...... 97 V. Strategy: Recommendation for Tourism Development and Implementation Plan for Eastern Circuit I ...... 98 a. Overview ...... 98 b. Infrastructure and Institutional Development ...... 101 Institutional Capacity ...... 101 Infrastructure Development: Transit to the East ...... 102 Home/Farmstays ...... 103 c. Marketing Plan and Core Demographic ...... 104 Bhutan’s “Wild East” ...... 104 Target the Adventure Travel Market ...... 106 Target the Millennial Travel Market ...... 107
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d. Training and Capacity Building ...... 107 Hospitality Training ...... 108 Guide and Activities Training ...... 109 Beautification ...... 110 e. Liberalizing the Tariff Policy ...... 110 Scenario 1: Remove Tariff / Keep Royalty Fee in Eastern Bhutan ...... 111 Scenario 2: Reduce Tariff / Keep Royalty Fee in Eastern Bhutan ...... 112 Scenario 3: Tariff/Royalty stay the same ...... 112 The Thai Tariff Experiment ...... 113 The Chinese Tourist Market ...... 113 Regional Tourists ...... 114 f. Priority Product Development Strategy for Circuit 1 ...... 115 Trashiyangtse Tourism Product Development Priorities...... 116 Lhuentse Tourism Product Development Priorities ...... 118 g. Addressing Gender/Vulnerability ...... 120 h. Access to financial resources ...... 122 VI. Conclusion ...... 123 VII. Implementation Plan ...... 130 Program Profiles ...... 141 References...... 142
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List of Abbreviations
ABD Asian Development Bank ADA Austrian Development Agency ADC Austrian Development Cooperation BGT Beyond Green Travel LLC BRAC Bangladesh Rural Advancement Committee, now known as BRAC BTM Bhutan Tourism Monitor CBST Community -based Sustainable Tourism CEDAW Convention on the Elimination of All Forms of Discrimination Against CRC ConventionWomen on the Rights of the Child CSMI Cottage, Small and Medium Industries Dz Dzongkhag FYP Five Year Plan GDP Gross Domestic Product GNH Gross National Happiness GNHC Gross National Happiness Commission HAB Handicrafts Association of Bhutan MDGs Mill ennium Development Goals NCWC National Commission for Women and Children NGO Non-Governmental Organization NPAG National Plan of Action for Gender RGoB Royal Government of Bhutan RSPN Royal Society for the Protection of Nature SAARC South Asian Association for Regional Cooperation SDGs SAARC Development Goals TCB Tourism Council of Bhutan UNDP United Nations Development Programme UNIFEM United Nations Development Fund for Women (UN Women) UNWTO United Nations World Tourism Organization WWF World Wildlife Fund
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Executive Summary
Bhutan’s 11th Fifth Year Plan (2013-2018), in conjunction with the Tourism Council of Bhutan’s (TCB) Tourism Strategy and Development Plans 2013-2018, sets out the ambitious goal of 200,000 annual tourist arrivals by 2020 and makes tourism a key pillar of economic growth and development for the country. Bhutan seeks to foster “a vibrant industry as a positive force in the conservation of environment and promotion of cultural heritage that safeguards the sovereign status of the Nation and significantly contributes to Gross National Happiness.” (TCB, p. iii)
A landmark feature of tourism policy in Bhutan is the mandate of a daily tariff for all international tourists. Each international tourist is required to pay a daily rate of US$250 per person per night during high season and US$200 per person per night during low season. Although the “High Value, Low Volume” policy was successful in creating an image of exclusivity for Bhutan, the shift to a “High Value, Low Impact” policy in 2011 seeks to accelerate tourism growth to reach the 2020 target of annual 200,000 tourist arrivals - almost twice the number of international and regional tourist arrivals in 20141.
The majority of tourism development to date and its attendant economic benefits has taken place in the well-known tourism areas of Paro, Thimphu, Punakha, and Phobjikha (commonly referred to as the “Western Circuit”). In 2014, Paro and Thimphu alone received over 60% of total annual bed-nights; nearly 90% of total bed-nights were spent in the dzongkhags of Paro, Thimphu, Punakha, Wangdiphodrang, and Bumthang. Because the dzongkhags in Eastern Bhutan are remote and have extremely limited tourism infrastructure, very few tourists travel there (only 3.7% of international tourists visited the six Eastern dzongkhags in 2014). Given this disparity in tourism economic benefits across the country and the high rates of poverty and underemployment in the east, the decision was made to develop a tourism circuit for Eastern Bhutan based on an integrated sustainable
1 International and regional tourist arrivals in 2014 was 104,984 according to Bhutan Tourism Monitor for 2014.
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tourism approach. The tourism development plan for Eastern Bhutan has been broken into two circuits, and the plan for Circuit 2, which encompasses the dzongkhags of Trashigang, Pema Gatshel and Samdrup Jongkhar, was completed in 2013. Although combining all six Eastern dzongkhags - Mongar, Lhuentse, Trashiyangtse, Trashigang, Pema Gatshel and Samdrup Jongkhar – and designing a comprehensive tourism circuit plan for Eastern Bhutan is TCB’s goal and a key recommendation of this report, this report was commissioned to focus on the dzongkhags of Mongar, Lhuentse, and Trashiyangtse, identified as Circuit 1.
The first section of this report introduces Bhutan’s place in the global tourism market and provides an overview of the scope of work and research methodology, and an introduction to international tourism market trends and their importance to Bhutan’s tourism development. This section also highlights issues surrounding gender and vulnerability in considering tourism development strategies.
The second section of this report describes the Eastern Bhutan dzongkhags of Mongar, Lhuentse, and Trashiyangtse; it looks at economic participation and employment opportunities, regional and international tourist visitation, and tourism products and market value chains in the context of the Circuit 1 dzongkhags. Field research and extensive meetings with local stakeholders, including officials in each of the Dzongkhag Administrations, private sector representatives, and local community organizations and villagers have contributed to the information in this section.
Section three provides a SWOT (Strengths, Weakness, Opportunities and Threats) analysis of tourism in Circuit 1 in order to provide a foundation for analyzing and addressing the development of a tourism economy in Eastern Bhutan. Ways to contextually develop and differentiate the east are explained. The section also explores how to target and capture a new and growing travel demographic. Noting that to date Bhutan has focused almost exclusively on a senior travel demographic ages 55+, this report explores capturing the rapidly growing adventure travel and
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millennial travel market sectors. This section also explores the need for better tourism sector training, increased capacity building, improved tourism product development and management, and strengthened infrastructure in order to support Bhutan’s ambitious goals for tourism development in the east.
Section four of this report provides a comprehensive review of the Eastern Bhutan Circuit 2 Tourism Development Plan for Trashigang, Pema Gatshel and Samdrup Jongkhar. In addition to a review of this 2013 report, meetings with Circuit 2 stakeholders were carried out in order to gather feedback on the report and provide comments to establish a better implementation strategy in Circuit 2.
Section five of this report presents the core strategies for tourism development in Eastern Bhutan’s Circuit 1. These core strategies include recommendations for tourism sector capacity building, infrastructural development, marketing based on a new core target market and contextual differentiation of Eastern Bhutan, tourism and hospitality training (with particular attention given to gender and vulnerable populations), and tariff policy adjustments that currently limit tourism growth potential in the east.
Section six of the report presents the implementation plan and a recommended timeline for implementing the Eastern Bhutan Circuit 1 Tourism Development Plan.
Key findings of this report note ongoing challenges to increasing tourism arrivals in Eastern Bhutan: Institutional capacity: there is no clear structure at the local level for managing tourism development; Lack of tourism infrastructure that can support tourist arrivals: o No reliable air service into Eastern Bhutan for tourists; o Extremely poor road conditions and prevalence of road blocks; Lack of differentiation in destination tourism marketing for Eastern Bhutan; Poor quality of tourism services;
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Lack of incentives for tour operators and tourists to visit Eastern Bhutan; Lack of knowledge and skills of those involved in the tourism sector; Lack of accessible training for those interested in participating in the tourism sector, including men, women, and youth; Lack of access to financial resources to build a tourism economy, including micro-credit and small enterprise development support.
The report notes that the goal is not only to alleviate certain barriers and challenges, but to enact changes that will orient the region towards both short and long term growth, including increasing tourism arrivals and total bed nights. Bolstering infrastructure and access to Eastern Bhutan, providing proper tourism and hospitality training, improving international marketing and addressing tourism policy constraints on the region are measures that will enable tourism to be used as a means of economic growth, poverty alleviation and regional income generation.
This report recommends repositioning Eastern Bhutan in the international tourism marketplace. Bhutan currently attracts only a small segment of the global tourist market – those 55 years and older make up the vast majority of international tourists to Bhutan2. These older tourists are primarily interested in cultural experiences and are also able to afford the US$250 per person per day minimum spend. While Bhutan has long sought to use the tariff to deter low-value tourists, the policy has also worked to Bhutan’s disadvantage: Bhutan has not benefitted from the largest segment of the global tourism market - working professionals (ages 25-55) who are largely focused on adventure travel. This report makes the case that it is this tourism market demographic that would be interested in Eastern Bhutan’s rugged conditions and wild beauty. Differentiating the east from the west is crucial to growing tourism visitation in Eastern Bhutan. A suggested rebranding of the Circuit 1 and 2 provinces as “Wild Beauty: Eastern Bhutan” or Bhutan’s “Wild East” is recommended. With unique terrain and landscape, the Buddhist kingdom’s “Wild East” could promote
2 Over 53% of all international tourists to Bhutan in 2014 were over the age of 55.
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more adventure-based activities – hiking, mountain climbing, kayaking, and trekking, to name a few. Bhutan can also bolster its cultural tourism in the east by honing in on its rich tradition of Buddhist art and spiritual history so integral to the region.
Building on the strategic recommendations laid out above, key recommendations that can fast track tourism development in the region follow.
Institutional Capacity TCB’s objective for the six dzongkhags of Eastern Bhutan is for tourism planning and management to be held at the circuit level and be governed by a Circuit Tourism Committee (CTC) – an executive body comprised of public and private member representatives from the dzongkhags. The two circuits of Eastern Bhutan should be joined, and one CTC should manage tourism development for the entire eastern region.
A Tourism Officer should be identified and assigned in each of the six dzongkhags. This officer will be responsible for interfacing with TCB and managing tourism development efforts at the regional level, as well as participating in the CTC to ensure coordination with the other eastern dzongkhags in implementing the overall circuit tourism development plan.
Providing a clear outline of responsibilities for the Tourism Officer will be important to the success of the development plan, and careful monitoring and evaluation of progress – including setting benchmarks – is critical to moving the tourism development process forward.
Other stakeholders should be carefully identified to participate in the CTC, with attention paid to encouraging and enabling women’s participation, along with youth, so that all important community voices are included in the tourism development planning and implementation process. Clear lines of decision-making and authority
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for carrying out specific tasks of the Circuit Tourism Development Plan must be outlined and adhered to; results must be monitored and performance evaluated.
Transit to the East Given the fact that the ongoing construction of the roadways to the eastern provinces poses significant obstacle to tourists transiting to the east, it is recommended that Bhutan’s air carriers increase flights to the airports at Bumthang and Yongphula from Paro. While the frequency of these flights may be limited initially until there is a substantial increase in demand, it is important that flights are available to tourists who wish to fly to these airports. Transit via air should be marketed as the preferable option for tourists by tour operators, given the fact that it allows greater numbers of tourists to travel with greater ease and frequency to Eastern Bhutan.
Accommodation in the East While there are some guesthouses and hotels, accommodation options in the east are more limited and at a lower standard than those in western Bhutan. Properly managed homestays can provide an immediate accommodation option while also ensuring that tourism sector revenues (and the ensuing economic benefits) are delivered directly to those most in need. The quality of Bhutan’s current homestays and farmstays is not at an adequate standard to host international tourists. To ensure the success and development of Bhutan’s eastern homestay program, quality controls need to be instituted and investment in both human capital and accommodation standard is warranted.
Bhutan’s “Wild East” Position the eastern region – comprised of the dzongkhags in Circuits 1 and 2 – as Bhutan’s “Wild East”. This branding identity differentiates the eastern region as a unique destination within the kingdom of Bhutan, highlighting one of the “last frontiers” on earth – where rugged adventure and expedition-like travel are the cornerstones of the tourist experience. Adopting a differentiated destination brand-
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identity allows travelers to view the region in a new light. The east is a part of Bhutan, but it also offers something different; it generates a new and exciting marketing angle and can enable the country to capture a new tourism demographic.
Target the Adventure Travel Market As Bhutan develops a brand identity for its underdeveloped eastern region, adventure travel – a booming sector of the global travel market – should become the cornerstone of the eastern region’s tourism experience. Adventure travelers comprise a younger demographic (with an average age of 36 years old), and are drawn to destinations that successfully offer rugged natural and cultural heritage experiences.
Target the Fast-growing Millennial Travel Market These individuals are poised to become a tour de force in the global travel market. They are a younger subset – generally acknowledged to be 25-34 years old - who will reach their prime working, earning, and spending years over the coming decade. They comprise a significant portion of the travel market. They exhibit different tastes in travel than older generations, and are more interested in culturally authentic, unique experiences that offer a true look into a destination’s way of life. With successful, targeted marketing, the eastern region of Bhutan will be a prime attraction. These are not the stereotyped “budget traveler” Bhutan seeks to avoid, but rather, they are willing to spend US$100 - US$150 per day for unique travel experiences, and the current US$250 per day tariff is a disincentive for this market to visit Bhutan. They have immense potential to bring needed revenue to Eastern Bhutan, while simultaneously being willing to accept the lower standards of accommodation and infrastructure that currently prevail in the region. Being younger, they also have high repeat visitor potential.
Training and Capacity Building To bolster Bhutan’s tourism workforce in order to handle its goals of increased international visitation in the east, Bhutan must develop its human capital in the
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tourist and hospitality industries. In order to contend with the need for intensive training, it is recommended that Bhutan set up a regional hospitality and tourism training program, with the requirement that all hospitality workers register and take part in training to some degree. Given the geographic spread of the region, we propose that trainings be offered through a mobile training unit that has the ability to work in both regional urban centers as well as small villages. TCB should initiate coordinated efforts to design and direct a variety of training curriculums, including utilizing local, regional and international assistance and support. Courses that are easily accessible to various stakeholders and tailored to the specific needs of potential and current tourism workers can be instrumental in developing the capacity to support tourism growth in rural areas. This model of a mobile tourism training unit has been successful in countries that have also sought to improve tourism services and capacity in remote regions.
Beautification Many sites in the eastern region need to be beautified in order to improve the aesthetic of traveling to these locations. Better and more consistent waste management – including consistent removal of trash residue, construction rubble, and animal waste in villages and small towns – is important to not only attracting more tourists, but ensuring that the standard of the tourist visit is at a consistently high level.
Liberalizing the Tariff Policy The minimum daily tariff of US$250 per international tourist per day during high season and US$200 per international tourist per day during low season has prevented Bhutan from capturing the fast growing middle-market tourist demographic, ages 25-55. Eliminating or reducing the tariff while keeping the royalty fee for all tourists (international and regional) visiting Eastern Bhutan will be a powerful incentive for those who seek to visit Bhutan but previously could not afford the high daily spend. Three scenarios are laid out that describe implications for removing, reducing, or keeping the daily tariff in the eastern region:
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Scenario 1: Remove Tariff / Keep Royalty Fee By eliminating the tariff for travel to Eastern Bhutan while keeping the royalty fee of US$65/day for all tourists (international and regional), Bhutan immediately creates a strong incentive for increasing tourist visitation to the eastern region. All tourists would still have to travel through a licenced Bhutan tour operator. Elimination of the tariff while keeping the daily royalty fee safeguards against the extremely low-budget tourists that Bhutan seeks to avoid. The per day royalty fee will also continue to benefit Bhutan by providing government revenue from visitation. By removing the tariff but keeping the royalty fee – and in coordination with other measures mentioned in this strategy – Bhutan has the potential to rapidly increase visitation to the east, thus improving economic distribution and increasing tourism sector revenues for the country.
Scenario 2: Reduce Tariff / Keep Royalty Fee An alternative to completely removing the tariff for travel to Eastern Bhutan is to reduce the daily tariff to US$85 per person per day. Combined with the $65/day royalty fee, the per day required spend would be US$150 per person per day. While this policy would not have the same powerful impact and incentive for increasing tourist visitation, it would still open Eastern Bhutan to a larger travel market and incentivize the east as a more affordable travel destination within Bhutan.
Scenario 3: Tariff / Royalty Fee Stay the Same The current Tariff/Royalty Fee policy of US$250 and US$200 per person per day is a significant obstacle to increasing international tourist arrivals in Eastern Bhutan. As it currently stands, the US$250 minimum spend not only constitutes a significant challenge for the east, but it is in fact directly harming tourism growth in the region. If Bhutan wants to keep a US$250 per day minimum spend throughout the whole country, then serious capital investment is needed in the short term to bring the quality standards of the east – accommodation, guide services, roads, restaurants, and other tourism sector businesses – to a level that warrants as high a daily spend as in the west.
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This report recommends adopting Scenario 1 for all tourists (international and regional) in Eastern Bhutan. Scenario 2 is a feasible option, as well, but will not deliver as strong results as Scenario 1 in terms of building tourism in the east. This report does not recommend Scenario 3.
Priority Product Development for Circuit 1 The three eastern dzongkhags of Circuit 1 have established extensive inventories of their attractions. In the case of Trashiyangtse and Mongar, a comprehensive list of tourism products including tours and circuits has been published in colorful booklets that form part of each dzongkhag’s tourism development plan. Many of these tourism products will require longer-term product development to bring them up to the basic standard necessary to attract international tourists. The immediate focus should be to generate increased tourism arrivals over the next 1-3 years by prioritizing certain specific and unique attractions and facilities that can generate increased tourism opportunities for overnight visitors. Several more easily accomplished overnight excursions are outlined for each of the two dzongkhags to encourage increased bed-nights for Circuit 1 in the shorter-term, while other tourism products should be prioritized in consultation with local stakeholders for the longer- term.
Addressing Gender and Vulnerability Properly managed and implemented tourism development can provide opportunities for women and other vulnerable populations, such as youth, to benefit from a growing economy. However, tourism can also create conditions of exploitation and can confine workers, especially women, to low-skilled and low-paying occupations in the industry, with little chance for economic betterment, social mobility, or increased skills training. As Bhutan seeks to develop a strong tourism economy in Eastern Bhutan, it is important that rural women have ample opportunity to not only participate in the industry, but also have access to opportunities for increased training and skill development. Participation beyond marginal-income activities is
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crucial to ensuring that women and families have opportunities for true economic benefit and social mobility.
Providing individuals with direct access to tourism markets is of particular importance as Eastern Bhutan develops tourism. If Bhutan seeks to achieve its goal of using tourism to improve the region’s underemployment, and counter rural poverty, then strong and direct linkages between visitors and rural stakeholders need to be established. Rural towns should be the focus of development in the east, and homestays should be developed and utilized to host visitors, as homestays (instead of tourist hotels) can provide a direct link between tourist revenues and local hosts. By ensuring strong linkages between tourists and local stakeholders, Bhutan can best spread the benefits of tourism into the rural economy, reach more people in need, and improve livelihoods by supplementing traditional sources of income.
Access to Financial Resources Access to financial resources is an important component of empowering local communities to engage in the tourism economy. Of particular importance is access to micro-finance opportunities, including micro-credit, defined as “extremely small loans given to impoverished people to help them become self-employed.”3 As Bhutan seeks to both decrease rural poverty and broadly improve the standard of its local tourism facilities in the east, incentivizing local stakeholders through low risk micro-loans can be a powerful stimulus for encouraging private operations to invest in their own business development. For example, in the case of a homestay, access to micro-credit to improve the standard of the homestay and what it can offer guests not only contributes to improving the tourism experience in Eastern Bhutan, but encourages local ownership and economic participation. A better standard of homestay lodging attracts more tourists, which in turn leads to increased revenue, loan repayment, and increased opportunity for reinvestment.
3 Gert van Maanen in Microcredit: Sound Business or Development Instrument (2004) notes that “Microcredit, or microfinance, is banking the unbankables, bringing credit, savings and other essential financial services within the reach of millions of people who are too poor to be served by regular banks, in most cases because they are unable to offer sufficient collateral.”
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In conclusion, achieving tourism growth in Eastern Bhutan in both the short term and the long term is not going to be easy, but it is achievable by taking bold leadership steps to rethink Bhutan’s tourism model. This report has put forward a series of recommendations to do that, but it will require a coordinated multi-stakeholder approach to meet the challenges and to turn weaknesses into strengths.
Program Profiles (Program Profiles will be developed and provided in the final version of this report).
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I. Introduction a. Bhutan in the Global Tourism Market
Bhutan, as a country destination, is a relative newcomer to the international tourism market. The Kingdom of Bhutan only opened its doors for international visitors in 1974, and did not privatize its tourism industry until 1991. Tourism numbers have been increasing annually – from just over 40,000 tourists in 2010 to just over 100,000 (combined regional and international)4 tourists in 2014 (out of a total of 133,480 visitor arrivals)5.
The 11th Fifth Year Plan (2013-2018), in conjunction with the Tourism Council of Bhutan’s (TCB) Tourism Strategy and Development Plans 2013-2018, sets out an ambitious goal of 200,000 tourist arrivals by 2020, and makes tourism a key pillar of economic growth and development for the country. It also sets a tourism vision for the country: “To foster a vibrant industry as a positive force in the conservation of environment and promotion of cultural heritage that safeguards the sovereign status of the Nation and significantly contributes to Gross National Happiness.” (TCB Tourism Strategy and Development Plans 2013-2018, p. iii)
Two key features of the Royal Government of Bhutan’s (RGoB) national tourism policy have defined how tourism has developed to date in the country. The first is the focus on “High Value, Low Impact” tourism. While initial tourism policy centered on “High Value, Low Volume,” the policy shifted in 2011 to “High Value, Low Impact.” This policy seeks to strike the right balance between economic gains from tourism and the preservation of Bhutan’s unique cultural, religious, and natural heritage. It is in harmony with the country’s larger development framework of Gross National Happiness (GNH), accepted as an enhanced and broader strategy to measure a
4 Bhutan defines Regional Visitors as those arriving from India, Bangladesh, and Maldives. All other visitors are classified as International visitors. Regional visitors neither have to obtain a visa nor follow the protocols/regulations that are applicable to international visitors. 5 According to Bhutan Tourism Monitor Annual Report 2014.
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country’s development and success by the UN General Assembly in 2011 as part of the Millennium Development Goals (MDGs). It affirms that tourism must be environmentally and ecologically friendly, socially and culturally acceptable, and economically viable. A landmark feature of tourism policy in Bhutan mandates a daily tariff for all international tourists, who are required to pay a daily rate of US$250 per person per night in the high season and US$200 per person per night in the low season. Although the “High Value, Low Volume” policy and tariff structure have been successful in creating an image of exclusivity for Bhutan, the RGoB is keen to further capitalize on the potential of tourism to become a major pillar of the economy. The shift to a “High Value, Low Impact” policy seeks to both accomplish this goal and accelerate tourism growth to a targeted 200,000 annual tourist arrivals by 2020.
The TCB Tourism Strategy and Development Plans 2013-2018 also recognizes that tourism, as it develops, needs to reflect the following: be consistent with the domestic GNH agenda and deliver a balance of economic, social, and environmental benefit and opportunity to the people of Bhutan; offer an enlightening, educational and inspirational experience to a growing number of international visitors; and be an industry that causes a minimal carbon footprint and whose impact is off-set in terms of global warming. (TCB, p. 1)
Currently, the strongest draws for tourists to come to Bhutan are the country’s unique cultural heritage, ancient religious traditions, and pristine nature. Bhutan has also been marketed to cultivate the image that the country is a real life “Shangri La.” The country’s forests and mountains include rare wildlife species – such as snow leopard, tiger and elephant – and more than 415 bird species, including the endangered Black-Necked Crane. Most of the tourism development to date and the attendant economic benefits have taken place in the well-known tourism areas of Paro, Thimphu, Punakha, Phobjikha (commonly referred to as the “Western Circuit”), and to a lesser degree in Bumthang. In 2014, Paro and Thimphu alone received over 60% of total annual in-country bed-nights; nearly 90% of total bed-nights were spent in the dzongkhags of Paro, Thimphu, Punakha, Wangdiphodrang, and
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Bumthang. The remaining 14 dzongkhags received less than 9% of total bed-nights, and the three dzongkhags of Circuit 1, Mongar, Lhuentse, and Trashiyangtse in Eastern Bhutan recorded only 1% of total bed-nights. (BTM 2014, p. 14)
In order to reach the ambitious goals for tourism revenue and visitation set forth in the 11th Fifth Year Plan, the RGoB has recognized that tourism development can only be accomplished by broadening both the geographical spread and seasonality of tourist visitation. Despite some significant cultural and natural attractions in the east, the eastern region remains largely removed from Bhutan’s tourist circuit. To that effect, TCB has prioritized the eastern area of the country for tourism development, and initiated a plan to develop a tourism circuit in the east. The development of a complete Eastern Circuit in this region of the country can deliver tourism growth to rural areas in need of economic and social benefits and, if managed effectively, can contribute to increasing overall international tourist visitation to the country.
Tourism, when well-planned and managed, does not only have the potential to increase sector revenues, but also can safeguard cultural traditions and natural treasures. Local participation is crucial in this paradigm, as tourism growth can empower local stewards to help protect precious cultural and natural resources in Bhutan. But in order to realize the potential economic and social benefits of a properly managed tourism economy – one with a high degree of local participation and engagement – a strong tourism marketing and product development plan that also responds to the fast growing adventure travel marketplace is needed. Eastern Bhutan and its unique offerings must be positioned correctly both in the framework of tourism development in Bhutan and in the international marketplace. With careful planning that is guided by sustainable tourism best practices, Bhutan can reap the benefits of tourism while ensuring protection for its cultural heritage and rich biodiversity.
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b. Purpose and Scope of Work
In order to ensure sustainable tourism development and to maximize the potential of the tourism sector in accordance with national policy, TCB has recognized the need for managing and monitoring tourism development at the dzongkhag level. This is also in line with government objectives to decentralize planning and development to the local level, as delineated in the National Tourism Policy and the Tourism Strategy Plans 2013-2018, and to foster community participation and resource management at the destination level. Because the dzongkhags in Eastern Bhutan are remote, have seen very limited tourism (only 3.7% of tourists visited the six eastern dzongkhags in 2014) (BTM 2014, p. 8), and individually do not have enough potential tourism products to attract tourism visitation, the decision has been made to develop a tourism circuit for Eastern Bhutan which can provide a holistic and integrated approach to the development of a sustainable and competitive tourism destination. The tourism development plan for Eastern Bhutan has been broken into two circuits, and the plan for Circuit 2, which encompasses the dzongkhags of Trashigang, Pema Gatshel and Samdrup Jongkhar Dzongkhags, was completed in 2013.
This document addresses the three dzongkhags of Mongar, Lhuentse, and Trashiyangtse – known as Circuit 1. Also contained in this document is a review of the previously completed Tourism Development Plan for Circuit 2, in order to provide feedback on the work that was done and make recommendations for integration with Circuit 1 and a more unified plan for all of Eastern Bhutan. Although a comprehensive tourism circuit plan for all six dzongkhags in Eastern Bhutan – Mongar, Lhuentse, Trashiyangtse, Trashigang, Pema Gatshel and Samdrup Jongkhar – is TCB’s ultimate goal, the focus of this report is on the three Circuit 1 dzongkhags. TCB’s objective for the six eastern dzongkhags is for tourism planning and management to be at the circuit level and governed by a Circuit Tourism Committee (CTC), an executive body comprised of public and private member representatives from the dzongkhags. TCB will guide the CTC in implementing the Circuit Tourism Development Plan (CTDP). In addition to joining the two circuits
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under single management, TCB hopes that decentralized participatory tourism planning and development will create more opportunities for local communities to engage directly with the tourism economy.
Beyond Green Travel LLC, a global sustainable tourism consulting firm, brings both international and national expertise to this tourism development project. An understanding of the global tourism market is coupled with a deep understanding of tourism in Bhutan, which is critical to designing a tourism development plan that is realistic, implementable, and based on a solid understanding of global and local context. The lead international consultant, Costas Christ, is a recognized global expert in sustainable tourism; he has worked in both public and private sectors of international tourism for more than three decades. Dr. Karma Tshering, the Bhutanese national counterpart, brings experience working in Bhutan’s tourism sector and governmental agencies. The team includes other experts in sustainable tourism who bring additional experience in international community development, pro-poor tourism growth, and hospitality management within the international context. c. Methodology
The methodology for the Tourism Development Plan for Eastern Bhutan Circuit 1 includes research and analysis of both international and country-specific information as it relates to the potential for sustainable tourism development in Eastern Bhutan. Background research and comprehensive meetings with key stakeholders in Thimphu was followed by extensive field research in Bhutan’s eastern provinces. Field research included a thorough and critical Strengths, Weaknesses, Opportunities and Threats (SWOT) analysis of tourism related economic, social and ecological potentials of the dzongkhags of Mongar, Lhuentse, and Trashiyangtse. In order to provide constructive feedback to the previously conducted Circuit 2 report and to determine potential linkages between the two circuits, additional research and analysis of Circuit 2 was conducted. Field research included meetings with key
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stakeholders including government officials, private sector representatives, and local community members. Group discussions that addressed issues of economic development, gender inclusion, and poverty alleviation strategies were also conducted. Tourism products were assessed and analyzed and additional research was conducted on international tourism and market trends, as well as international and regional visitation patterns to Bhutan.
In designing the methodology of this project, it is important to consider the international, regional, national and local contexts that will inform tourism development in Eastern Bhutan. Sustainable tourism is put forward as a strategy for economic development in rural and impoverished areas: as a way to improve livelihoods, reduce poverty, and enable women and other vulnerable sectors of populations to benefit. However, tourism is not a panacea for addressing these development challenges. Without a thorough understanding of the different aspects of tourism – markets, visitors, and products – the presentation of the opportunities that tourism can offer is often unrealistic and leads to unrealistic expectations for impact. For example, in the so called “build it and they will come” model of tourism development, there is the common misperception that if tourism products are developed, then tourists will flock to them.
This fallacy is evident in tourism case studies around the world, including Bhutan, in which product development alone did not deliver increased visitation or tourism revenues. While Eastern Bhutan may have valuable tourism products, and the potential to develop more, results-driven marketing and global positioning are as important to increasing visitation as the products themselves. In order for tourism development to be successful, a multi-faceted approached including targeted marketing, capacity building and hospitality training, and national policy must all lend strong support to a well-designed, targeted strategy for building a tourism economy. This report, in its methodology, has not only focused on potentials for product development, but all the components that achieve sustainable tourism growth through realistic and structured implementation. This document examines
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international context – how Bhutan positions (and can position) itself in the international marketplace, who its visitors are, and who they might and can be in the future. Regional context is similarly important, as almost 50 percent of Bhutan’s tourist arrivals are regional tourists who are subject to different national tourism policies than those that apply to international tourists. Different policies means that these tourists have a different impact on the economy, and can negatively or positively impact Bhutan’s potential for sustainable growth in the international community. National tourism strategy for Bhutan was also reviewed and its impact analyzed with respect to Bhutan’s ambitious goals for tourism development in the country. d. Market Analysis and Age Demographic
The global tourism marketplace continues to grow and change as destinations become more or less popular, and the travel interests of new generations of tourists shift. In order for Bhutan to further develop its tourism industry, it must be both aware of and responsive to the changes in the international and regional tourism markets. Sustainable tourism is becoming well understood as a means to both encourage growth and safeguard a destination’s authenticity and heritage, while delivering important social and economic benefits to local people.
The number of global tourist arrivals continues to grow year over year. That growth is expected to continue: global growth surpassed 1 billion travelers in 2012, reached 1.13 billion in 2014 and is expected to reach nearly 2 billion international tourist arrivals by 2030. (UNWTO Tourism Highlights 2015, p 2). Bhutan is well-positioned to benefit from this growth if it can capture more tourist arrivals and manage growth in a way that minimizes negative impacts to its natural and cultural assets. Strong and unified policies to manage tourism growth continue to be needed in order to harness the positive impacts of the global tourism industry.
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Currently, tourism to Bhutan has attracted older international visitors who are able to both afford the daily US$250 tariff and who are interested in Bhutan’s primarily culture based attractions.
61+ 31.62%
56-60 22.35%
46-55 17.46%
36-45 12.21% Age 26-35 11.30%
18-25 2.69%
< 18 2.25%
0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00% 35.00% Percentage
Figure 1: International Tourists by Age Group, 2014 (BTM 2014, p. 7)
This older 55+ age market - which in 2014 comprised over 53% of Bhutan’s total international tourist arrivals - favors relatively easy physical activities and travel experiences. These travelers express a generally positive level of satisfaction with their Bhutan travel experiences, but few return for a second visit. Bhutan currently has a low visitation rate from younger travelers, despite the fact that these younger travelers – mid-life professionals, ages 25-55 – have the financial resources and interest to travel internationally, and favor active and more adventurous travel experiences. Global travel organizations like Virtuoso, National Geographic, the Adventure Travel Trade Association, and the Society of International Travel Agents, target the 25-55 age travel demographic, as this market presents huge growth opportunities. Bhutan largely misses this segment of the international tourism market: in 2014, travelers aged 26-45 comprised only just over 1/5th of total international tourist arrivals to the country.
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In order to grow tourism in the eastern circuit, Bhutan should look to bring more tourists into the country, and attract younger markets. Eastern Bhutan, which has more rugged conditions, rustic accommodations, and strong adventure experience offerings, is suited to be marketed to a younger generation of travelers. Bhutan is in a prime position to grow tourism to the east, provided it expands its target tourism market demographic. The country can benefit from realizing how the offerings of the less developed east can appeal to this large demographic of younger, adventurous, “high value” travelers. e. Gender and Vulnerability
Tourism provides an important vehicle for working towards major country development goals laid out by both the UN and Bhutan, including poverty alleviation, promoting gender equality in the workforce, and empowering women and improving women’s access to viable economies. In the Global Report on Women in Tourism 2010, a report commissioned jointly by UNWTO and UN Women, tourism is identified as a way to “help poor women break the poverty cycle through formal and informal employment, entrepreneurship, training, and community betterment.” (p. vii) The study concludes that “there are more opportunities for women to participate in informal and self-employed work in tourism than in other sectors.” (p. viii) This is a relevant point for Bhutan as it seeks to engage women in the development of its eastern economy, because it means that tourism offers opportunities to engage in the sector through self-employment or small business enterprises. The report also notes that tourism has the potential to contribute to women’s empowerment, particularly in developing regions of the world, and that tourism policy-makers must be proactively involved in supporting programs that provide opportunities for women to join and participate in the tourism sector. Tourism, pro-poor development, and gender-equal economic opportunity all run hand in hand.
In addition to poverty reduction and empowering women and other vulnerable populations to participate in the economic sphere, Bhutan places strong emphasis
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on gender equality – defined by UN Women as “the equal rights, responsibilities, and opportunities of women and men, girls and boys.” Bhutan has long prioritized issues with women and children, becoming a signatory to the Convention on the Elimination of All Forms of Discrimination Against Women (CEDAW) in 1981, and the Convention on the Rights of the Child (CRC) in 1990. In 2004, the government established the National Commission for Women and Children (NCWC), which became a fully recognized agency under the RGoB in 2008; the NCWC is tasked with monitoring and coordinating all policies and activities related to the protection of the rights of women and children (SAARC Development Goals, Country Report 2013, p.2). Using the South Asian Association for Regional Cooperation (SAARC) Development Goals, a compendium of 22 goals and priorities that encompass Livelihood, Health, Education, and Environment, the Gross National Happiness Commission monitors and issues reports on progress towards the goals, which include a number of targets focused on women and vulnerable populations. The NCWC provides nationwide guidance on mainstreaming gender issues and improving gender equality in education, participation in government, labor and employment, and health, among others.
Yet while Bhutan has made strides to address gender inequality in multiple sectors, rural women lag behind in terms of opportunity for quality education, employment, and the ability to benefit from regional economic development – both for themselves and their families. In Eastern Bhutan, harnessing the power of men and women is critical to growing the tourism sector in the remote dzongkhags, as well as providing opportunities for women to more consistently benefit from the potential economic opportunities that tourism presents. Currently, there are significant barriers to the participation of local communities, and in particular women, in tourism development. For example, access to capital, in the form of loans, investment opportunities, and micro-credit, prevents both women and men from developing innovative products or offerings that may enable them to participate in a developing tourism economy. The lack of available tourism sector training and access to education not only limits the development of tourism products and facilities, it limits the development of improved
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hospitality skills that can increase the standard and capacity of tourism offerings in Eastern Bhutan. Improvements to the current paradigm can lead to increased employment opportunities in Eastern Bhutan, thus slowing the flight of potential workers to the more-developed urban centers of western Bhutan, which depletes already low regional human capital and sustains rural poverty. Developing resources to properly train women to enter and engage with the tourism sector workforce, in a coordinated and accessible manner designed to address the specific issues of Eastern Bhutanese communities, will be a critical component of a successful Eastern Bhutan tourism circuit and sustainable tourism economy. f. Strategy Overview
In order for tourism development in Eastern Bhutan to proceed strategically and successfully, its development must be well-organized and focused. While the potential attractions for visitors to Eastern Bhutan are many, the current state of infrastructure in the eastern part of the country presents significant challenges to the development of tourism. In order to be successful, development must focus on implementable, achievable action steps that can be accomplished in the current short term reality, while continuing to develop the infrastructure to support long term tourism growth. Our approach to developing tourism in Eastern Bhutan builds on previous work - by previous consultants, and by the dzongkhags themselves, who have completed comprehensive assessments of the tourism attractions in their provinces. This report seeks to provide a clear cut set of initiatives for spurring tourism growth, recommends an implementation plan, and suggests a timeline for realistic and attainable implementation.
II. Introduction to the Circuit 1 Eastern Dzongkhags of Mongar, Lhuentse, and Trashiyangtse
In order to understand the opportunities for the development of a tourism economy in the three dzongkhags of Circuit 1 in Eastern Bhutan, it is important to have a broad understanding of the overall context of the area, including its current economic profile, experience with tourism and facilities to host tourists, and the overall context
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on which a strategy for tourism development will be based. The following provides a snapshot of relevant information that forms the basis for the more in-depth analysis of the tourism development situation in Circuit 1. a. Introduction to the Provinces
Figure 2: Map of the 20 Dzongkhags of Bhutan (Circled are the 3 Dzongkhags of Circuit 1)
Mongar
Mongar Dzongkhag encompasses an area of approximately 1,944.95 km2 and lies between 27.25o latitude and 91.2o longitude. It is surrounded by the dzongkhags of Zhemgang, Bumthang, Lhuentse, Trashiyangtse, Trashigang, and Pemagatshel. It is considered a hub for the eastern dzongkhags as the lateral east-west highway – currently still under construction – passes through the city of Mongar. Other main roads connecting eastern towns and cities also pass through Mongar town. Accessibility has contributed to the rapid growth of Mongar town - it is currently one of the fastest growing towns in Eastern Bhutan. The old town – built in traditional Bhutanese style – remains an attraction to tourists and locals; a new town is growing on the outskirts, with more modern buildings and structures.
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Mongar Dzongkhag is divided into 17 gewogs6 and
has a population of 41,8527. Agriculture serves as the MONGAR DZONGKHAG PROFILE
primary source of income for the majority of the Geographical area: 1,944.95 km2 Mongar population. Principle crops are maize, rice, Population: 41,852 (2013) barley, wheat, and buckwheat. Additional “cash crops” Male: 21,963 Female: 19,889 include lemongrass, mango, apple, orange, No. of Gewogs: 17 cardamom, corn, potatoes and vegetables. Hazelnut No. of Villages: 683 Altitude range: 300 – 4200 meters cultivation (hazelnuts are not native to Bhutan) was Climate: Hot and humid summers/ introduced in 2006 through foreign investment as a cool and cold winters
potential income-generating cash crop. A growing Poverty rate: 10.5% Literacy rate: 59.5% number of local farmers are now participating in this Forest cover: 91.59% venture and growing hazelnuts on their land. These Agriculture centers: 17 “cash crops” have potential interest to the tourism economy, both supplied to tourism enterprises like Health centers: Hospital: 1 accommodations and restaurants, as well as BHU: 24 ORC: 57 potentially of interest to visitors for purchase (i.e. Educational Institutes: lemongrass oil, etc.). Public schools: 51 NFE centers: 128 Monastic schools: 27 The elevation of Mongar Dzongkhag ranges 300-4200 Major development project: Kurichu meters. Forest cover is nearly 92%. The climate is hot hydro project
and humid during summer months but winters are Source: Eleventh Five Year Plan (July 2013- June 2018), Mongar Dzongkhag cold. Mongar encompasses part of Thrumshingla National Park and Bumdeling Wildlife Sanctuary,
protected regions in Eastern Bhutan.
6 A gewog is an administrative unit in Bhutan, smaller than a dzongkhag, and is comprised of a group of villages. 7 Population in 2013.
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Figure 3: Map of Mongar (Eleventh Five Year Plan: Mongar Dzongkhag)
Lhuentse
Lhuentse Dzongkhag encompasses an area of approximately 2,808.53 km2. It is bordered by Bumthang to the west, Mongar to the south, and Trashiyangtse to the east; it shares an international border with Tibet in the north. Although Lhuentse is the ancestral home of the monarchs of Bhutan, it is one of the most remote and least developed dzongkhags in the country. Rates of poverty are among the highest in Bhutan. The dzongkhag is divided into 8 gewogs, with a population of 17,2008. The altitudinal range is 900-6,300 meters, with warm summers and cold winters. A national highway, 45 km away, connects the dzongkhag to Mongar. Almost all the gewogs are connected by farm roads. Subsistence agriculture is the major source of livelihood. Unlike other agricultural dzongkhags, there are barely any cash crops, but the dzongkhag is known for its traditional weaving of silk textiles, which are sold throughout Bhutan. Weavers of these handicrafts are predominately women, and weaving these textiles provides one of the few sources of income available to women in the province.
8 Population in 2013.
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LHUENTSE DZONGKHAG PROFILE
Geographical area: 2,808.53 km2
Population: 17,200 (2013) Male: 8,555 Female: 8,645
No. of Gewogs: 8 No. of villages: 230 Altitude range: 900 – 6,300 meters Climate: Warm summers/cold winters
Poverty rate: 31.9% Literacy : 55%
Forest cover: 60.41 %
Agriculture centers: 9
Health centers: Hospital: 1 BHU: 11 ORC: 33
Educational Institutes: Figure 4: Map of Lhuentse Public schools: 27 (Eleventh Five Year Plan: Lhuentse Dzongkhag) NFE centers: 58 Monastic schools: 10
Source: Eleventh Five Year Plan (July 2013-June 2018), Lhuentse Dzongkhag
Trashiyangtse
Trashiyangtse Dzongkhag encompasses approximately 1,449.26 km2, located between 27o22’latitude and 92o46’longitude. The dzongkhag was previously a sub- district of Trashigang but became a separate dzongkhag in 1993. It borders Lhuentse to the east, Mongar to the south east, and Trashigang to the south. It shares a border with the Indian state of Arunachal Pradesh and Tibet to the east. Elevation ranges from 800-6,000 meters. The climate is hot in the summer months and cold through the winter. Approximately 70% of the dzongkhag is covered by forest, and a large proportion of the dzongkhag falls within the Bumdeling Wildlife Sanctuary. Subsistence agriculture is the main source of income/livelihood, and
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maize, rice, millet, potatoes and chilies are the primary crops. Traditional paper making and wooden craft making is still practiced in some areas. The Kholongchu Hydro Project, a joint Bhutan-India hydropower and road construction project, is expected to provide an economic boost and some short term jobs during construction and is anticipated to be completed by 20189. However, the construction will also result in additional roadblocks and heavy disruption of travel in the area during the period of TRASIYANGTSE DZONGKHAG road construction. PROFILE Geographical area: 1449.26 km2
Population: 20,268 (2013) Male: 10,012 Female: 10,256
No. of Gewogs: 8 No. of villages: 117 Altitude range: 800 – 6,000 meters Climate: Hot summers/cold winters
Poverty rate: 13.5% Literacy rate: 60.4%
Forest cover: 70.89%
Agriculture centers: 8
Health centers: Hospital: 1 BHU: 7 ORC: 28
Educational Institutes: Public schools: 30 NFE centers: 25 Monastic schools: 6 Institute for Arts/Crafts: 1
Major development project: Figure 5: Map of Trashiyangtse Kholongchu Hydro Project (Eleventh Five Year Plan: Trashiyangtse Dzongkhag) Source: Eleventh Five Year Plan (July 2013- June 2018), Trashiyangtse Dzongkhag
9 Sarkar, D. Construction Phase of Indo-Bhutan JV Khologchu Hydro Plant Starts.
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b. Additional Demographic Information on Eastern Provinces of Mongar, Lhuentse, and Trashiyangtse
Table 1: Length of Roads (Kms) by Type and Dzongkhag (Statistical Yearbook of Bhutan, NSB, 2014)
Dzongkhag Primary Secondary Dzongkhag Urban Farm Access Percentage National National Road Road Road Road of Total Highway Highway National Roads 1,081.1 Mongar 213.4 20.0 71.4 11.4 687.2 77.6 (10.2%) Lhuentse 0.0 45.0 69.4 0,8 376.9 16.3 508.3 (4.8%) Trashiyangtse 0.0 40.0 40.7 8.7 178.6 24.9 292.8 (2.8%)
Table 2: Population (Male/Female) of the Three Circuit 1 Dzongkhags (2013)
25,000 21,963 19,889 20,000
15,000
10,012 10,256 10,000 8,555 8,645
5,000
0 Mongar Lhuntse Trashiyangtse Male 21,963 8,555 10,012 Female 19,889 8,645 10,256
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Table 3: Population Gender Age Structure (2013)
MONGAR LHUENTSE TRASHIYANGTSE Age range Male % Female % Male % Female % Male % Female %
0 -14 6521 14 6300 15 2540 15 2738 16 2972 15 3249 16
15 – 29 6181 15 5728 14 2407 14 2490 14 2816 14 2954 15
30 – 44 4940 12 4080 10 1924 11 1774 10 2252 11 2103 10
45 – 64 3252 8 2767 7 1267 7 1203 7 1483 7 1426 7
65 + 1069 3 1014 2 417 2 440 3 489 2 524 3
TOTAL 21963 52 19889 48 8555 50 8645 50 10012 49 10256 51
c. Economic Participation and Employment Opportunities
Information on employment and economic participation, both in Bhutan as a whole and in the three dzongkhags of Circuit 1, provides a perspective on the potential for tourism development, the level of participation that can be anticipated in terms of other opportunities available, the needs for capacity building in order to build a tourism economy, and the potential involvement and engagement of different sectors of the population in tourism, including men, women, and youth.
The following three tables provide an overview of employment in Bhutan, looking at engagement in the labor force, paid versus unpaid employment, and the different economic opportunities available in Bhutan. This information also provides a method for looking at differing participation rates for employment among men, women and youth.
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Table 4: Employment and Unemployment in Bhutan (National Commission for Women and Children, Gender at a Glance)
Table 5: Bhutan Paid/Unpaid Employment (National Commission for Women and Children, Gender at a Glance)
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Table 6: Bhutan Employment by Economic Activity (National Commission for Women and Children, Gender at a Glance)
Currently, employment in the tourism sector is limited in the three Circuit 1 dzongkhags, and statistics indicating employment in that sector are not systematically collected. The information below provides some information on employment in Circuit 1:
Table 7: Labor Force Participation in Circuit I by Gender and Nature of Employment (Department of Employment 2013, p.50)
Dz. Civil Service Other Govt. Public Co. Private Co. Agriculture M F M F M F M F M F Mongar 1104 280 588 325 580 221 142 0 6451 10769 Lhuentse 436 72 72 22 181 11 49 0 2129 2731 T/Yangtse 290 116 263 66 12 0 0 0 2252 2601 Bhutan 19090 8360 8956 3050 12102 4421 9885 2948 88100 100731
For the few hotels in Eastern Bhutan that offer employment, the following was determined from field research:
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Table 8: Employment by Hotel in Eastern Bhutan
Dzongkhag Name of hotel Regular employees Male Female Total Mongar Wangchuk 9 10 19 Druk Zom 3 3 6 Zhongar 5 5 10 Trogan villa (new 3 2 5 at Yonkola) Trashiyangtse Karmaling Family staff Lhuentse Phayul resort Family staff Trashigang Druk Deothjung 5 13 18 resort Lingkhar resort 4 12 16 KC 1 4 5 Samdrup Jongkhar Menjong 2 4 *11 Mountain TLT 3 5 *14 Tashi Gatshel - 2 *5 Total 35 60 109 *includes employed Indian nationals
Additional hotels not accredited by the Tourism Council indicated that they are family-operated, and utilize family workers. This is also the case with all of the homestays.
In looking at the data above, one can see that in Eastern Bhutan, the majority of the labor force works in the agricultural sector and that women are more heavily represented in this sector than in the other available employment sectors, which are dominated by men. This highlights both the existing lack of other opportunities in the east, particularly for women, and also highlights the potential opportunities for the positive impact of income generation from tourism development activities.
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d. Tourism Visitation
Bhutan’s goal is to steadily grow tourism visitation for both international and regional visitors. Bhutan’s present international source markets are largely dominated by tourists from the Asia/ Pacific region, followed closely by Europe/North America:
Figure 6: Bhutan Tourist Arrivals by Region by Year (BTM 2014)
Figure 6 reflects the trend for growing visitation from Asia. Note that a special holiday incentive program in 2014 for Thai visitors led to a dramatic increase in visitation from Thailand in the summer of 2014, significantly affecting the rankings of international source markets in 2014.
Table 9: Top 10 International Source Markets, 2010-2014 (BTM 2014)
Annual International Visitors % of % of % of % of % of Country 2010 Total 2011 Total 2012 Total 2013 Total 2014 Total Thailand 875 5% 2,235 9% 3,573 11% 3,494 11% 12,105 28% China 1,494 8% 2,896 11% 3,766 12% 4,764 15% 8,111 19% USA 5,189 28% 6,226 24% 6,007 19% 6,927 22% 7,291 17% Germany 2,250 12% 2,287 9% 2,880 9% 2,753 9% 2,971 7%
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Japan 2,963 16% 3,943 15% 6,967 22% 4,015 13% 2,707 6% UK 1,772 10% 2,795 11% 2,466 8% 2,291 7% 2,680 6% Malaysia 354 2% 788 3% 1,307 4% 2,029 6% 2,067 5% Australia 1,318 7% 1,773 7% 1,926 6% 2,043 6% 2,037 5% Singapore 785 4% 1,349 5% 1,605 5% 2,037 6% 1,720 4% France 1,454 8% 1,585 6% 1,847 6% 1,561 5% 1,636 4% Total: 18,454 100% 25,877 100% 32,344 100% 31,914 100% 43,325 100%
While the total number of visitors to the country is important, focusing on the number of bed nights spent in-country offers an important perspective, as tourists who stay longer contribute more to the economy of Bhutan overall:
Table 10: Top 10 International Source Markets by Bed Nights, 2010-2014 (BTM 2014)
Total International Bed Nights Per Year and Percentages of Total Bed Nights
Country 2010 % 2011 % 2012 % 2013 % 2014 % Avg USA 43,666 32% 50,288 28% 48,037 22% 52,440 24% 56,008 21% 25% Germany 20,040 15% 21,274 12% 26,350 12% 25,539 12% 28,270 10% 12% China 7,354 5% 14,694 8% 18,666 9% 23,425 11% 42,218 16% 10% Japan 15,743 12% 21,297 12% 34,013 16% 19,133 9% 12,908 5% 10% UK 16,400 12% 24,549 13% 20,929 10% 20,164 9% 22,502 8% 11% Thailand 9,773 5% 15,059 7% 14,810 7% 48,759 18% 9% Australia 11,606 9% 16,527 9% 17,666 8% 18,418 9% 18,078 7% 8% France 13,175 10% 14,065 8% 16,946 8% 14,872 7% 15,325 6% 8% Switzerland 8,244 6% 10,164 5% 11,454 5% 14,359 5% 5% Singapore 9,591 5% 11,101 5% 14,739 7% 11,396 4% 5% Total 136,228 182,058 218,931 214,994 269,823
International visitation to Mongar, Lhuentse and Trashiyangtse
As indicated below and noted previously, to date the majority of international tourists visit the western and central region of the country; Eastern Bhutan receives very low visitation by comparison. Circuit 1 and Circuit 2 provinces are noted in green and blue, respectively.
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Table 11: International Visitation by Dzongkhag, 2010-2014 (BTM 2014)
Total annual arrivals DZONGKHAG 2010 2011 2012 2013 2014 Paro 27,196 36,432 43,023 43,707 56,528 Thimphu 26,667 35,282 41,545 41,594 55,383 Punakha 13,135 28,319 32,738 30,127 43,003 Wangduephodrang 18,978 12,023 13,150 16,833 18,256 Bumthang 10,169 11,362 11,538 11,762 12,327 Trongsa 5,424 6,454 7,435 6,913 6,957 Chukha 4,705 5,212 5,388 4,574 4,826 Haa 1,579 2,638 2,954 2,811 2,801 Mongar 1,822 2,359 2,289 2,385 2,464 Trashigang 1,607 2,875 2,230 2,250 2,272 Samdrup Jongkhar 1,216 2,109 1,930 2,064 2,056 Trashiyangtse 189 219 835 937 672 Gasa 1,896 409 416 401 480 Lhuentse 155 288 146 144 230 Zhemgang 157 195 186 165 205 Sarpang 33 90 99 155 179 Pema Gatshel 9 33 105 84 96 Dagana 2 9 1 8 18 Tsirang 9 45 38 13 8 Samtse 0 3 4 5 3
The immense inequality in visitation between the three most popular dzonghags of the west – Paro, Thimpu, and Punakha – and the three Circuit 1 dzonghags is noted below.
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3 Western Dzongkhags 60,000 56,528 55383
50,000 43003 40,000
30,000
20,000
3 Eastern Dzongkhags
Total arrivals Totalarrivals forthe year2014 10,000 2464 0 672 230 0 Paro Thimphu Punakha Mongar Trashi Lhuntse Yangtse
Figure 7: 2014 Arrivals to Specific Western and Eastern Dzongkhags (BTM 2014)
Regional Tourist Visitation to Mongar, Lhuentse and Trashiyangtse
Regional tourists – tourists from India, Bangladesh and the Maldives – do not require a visa and are exempt from the daily tariff and royalty policies applicable to international tourists. Among regional tourists to Bhutan, those from India predominate (84% of regional tourists), followed by Bangladesh (16% of regional tourists) and the Maldives (less than 1% or regional tourists). (BTM 2014, p. 40) Indian tourists enter the country both by air and road, with various road entry/exit points (including Phuntsholing, Samchi, Sarpang, and Samdrup Jongkhar). Phuntsholing is the most popular road entry point for Indian tourists, and like their international counterparts, regional tourists are largely concentrated in the western part of the country in the districts of Paro, Thimphu and Punakha.
The actual number of regional visitors is not as accurately documented as international visitors, as they do not require visas to enter the country and benefit from an “open border policy” with Bhutan, but the table below reflects what is available from the Bhutan Department of Immigration, which collects information on regional visitor arrivals. Due to the lag in regional documentation, these statistics
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lack accuracy, but can provide a rough indication of regional visitation to Eastern Bhutan. More accurate data, and stricter protocols on data collection for regional tourists will be important to monitoring and understanding the impacts of regional
tourism, particularly in Eastern Bhutan.
Table 12: Regional Visitors to Eastern Bhutan
Regional tourist arrivals Dzongkhag 2013 2014 2015 Circuit 1: Mongar 206 61 251 Lhuentse 10 14 31 Trashiyangtse 3 92 100 Circuit 2: Samdrup Jongkhar 211 44 223 Pema Gatshel 3 0 0 Trashigang 257 81 67
Current Available Accommodations in Circuit 1
Low visitation numbers in Eastern Bhutan have discouraged hotel development and investment. Because the current tariff policy requires a three star minimum standard of lodging, hotel developers are further deterred because a hotel at that standard is a significant investment, and current demand is low. Tourists are however,
guaranteed a 3-star stay with the US$250 required minimum spend.
Table 13: Current 3-Star Hotels in Circuit 1
Dzongkhag Name of hotel Star No. of category rooms Mongar Wangchuk 3 32 Druk Zom 3 11 Zhongar 3 20 Trogan villa (new at Yonkola) 3 12 Lhuentse Phayul resort 3 7 Trashiyangtse Karmaling - 11
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Bhutan has encouraged the development of rural home and farmstays in an attempt to spread the benefits of tourism to local communities and at the same time create a more authentic rural experience for visitors:
Table 14: Available Homestay Accommodations in Circuit 1
Mongar Lhuentse Trashiyangtse Thinley Yangkula, Khoma Chorten Dendup, Yangtsi Namgyel, Aum Tshering, Khoma Dechen Dorji, Yangtsi Yoezer Café Norbu Lhaden, Khoma Tharpala, Bumdeling and Farm house Tshetrim Rabgay, Thukten Tshering, at Thridangbi Tangmachu Bumdeling Deki Peldon, Menji Mani Gyeltshen, Kinzang Tobgay, Menji Bumdeling Jigme Tshewang, Menji Karma Tshering, Omba Jangchup Dorji, Menji Thinley Wangchuk, Chimi, Menji Bimkhar Jamyang Choden, Menji Tshering Wangmo, Kezang Lhamo, Menji Bayling Sonam Zangmo, Hangzur Karma Choden, Lamdra Rinchen Yangtso
Due to low visitation and lack of marketing of these accommodations, the homestay program remains under-utilized and underdeveloped. Despite the listed properties above, currently the home/farmstay program does not meet the expectations of the host communities for generating income, nor the expectations of international tourists in terms of standards and experience provided. Management and oversight of this program in terms of developing standards suitable for international tourists has been lacking, which further dis-incentivizes visitation. For the majority of the homestay accommodations offered in Circuit 1, occupancy rates are close to or at zero. e. Eastern Circuit 1 Products
Currently, international tourists to Bhutan primarily undertake cultural tours; however, nature based activities such as trekking, hiking, and birdwatching are activities that have growth potential for Eastern Bhutan. Circuit 1 offers many
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opportunities for product development that can appeal to more adventurous international and regional tourists. The key attractions and products of each Circuit 1 dzongkhag are presented below:
MONGAR
Cultural products/attractions Zhongar Dzong ruins: half day excursion to the ruins which is accessible by road. 45 minutes’ drive from Mongar. Located adjacent to Limithang; Mongar dzong: the relatively new dzong is located above the Mongar town; Mongar town: a mixture of old and new traditional houses. Farmers market held every Sunday. An archery range below the town where locals gather frequently to play the national sport; Lhakhangs (monasteries), listed gewog wise: o Mongar gewog – Kharabshing, Pongchola, Kadam, Yagang, and Wenkhar; o Kengkhar gewog – Nyugphu, Dungkhar, and Kadam; o Gongdue gewog – Rinchenchoeling, Tsokiling, Dumkhar, Jangchugchoeling; o Chaskhar gewog – Dungkhar Choeling, Zongtopelri, Kadam, Yakdi; o Thangrong gewog – Changyongla, Kadam, Lingkhar; o Saleng gewog – Sengor; o Dramitse gewog – Drupchu gompa; o Ngatshang gewog – Jagoe, Ngatshang Tashi Choepheling, Sangachoeling; o Drepong gewog – laptsa, Zunglen, Drepung wob; o Jurmey gewog – Dungkharchoeling, Menchaphu, Rimphu, Zalashing; o Chali gewog – Chali Dechenchoeling, Wangmakhar, Karmachoeling; Chali village farm visit. Either driving or walking; Larjap: 30 minutes’ drive from Mongar town or 90 minutes hike to this peaceful and sacred place ideal for people to do some meditation; Tsanphu Drupdey: is a meditation area accessible by driving on a farm road along the ridge. It is 9 kms from Korila pass; Visit to Tsakaling and Naktshang village to experience village life, visit monasteries, village houses, and see local paper factory; Trekking to pilgrim sites of Aja ney and Phuning; Multiple local tsechus (festivals) from May till December in different villages Natural attractions Bird watching opportunities at Korila, Limithang, Yongkola and parts of Thrumshingla National Park in Saling gewog; Several day hikes combined with cultural tours; Nature walk at Korila for about 2 hours to explore the rich forest and bird watching; Hazelnut farming. Research plots and head office located at Limithang; River rafting; Trekking routes ranging from 4 to 7 nights camping
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LHUENTSE
Cultural products/attractions Lhuentse Dzong built in the mid-17th century; Ancestral home of the monarchs at Dungkhar which is another 40 kms from Lhuentse; Giant Guru Statue located at Takila; Silk textile weaving at Khoma village; Lhakhangs (monasteries) listed gewog wise: o Kurtoe gewog - Ugyenphu, Sershong Rinchen Bumpa, Geshingpang, and o Kunzangling monasteries; o Gangzur gewog - Jangchhuling gompa, Khauchung, and Killung; o Jarey gewog - Karsa Pokpa, Yabi, Tabong, Nagye, Jarey, and Yumtse; o Tshenghar gewog - Tsangphu, Dramthang, Domkhar, and Takchu; o Minjey gewog - Sengleng, Chengling, Chusa, Darchen, Zham, and Wangshing; Khoma geog - Taya, Pangkarla, Menkhar, Nyalamdung, Sangay Dadrung, lookchu, Rongmateng, gompa karp, and Temola; o Menbi gewog - Takila, Kesibi, Zarthangla, Pelri, and Rawabi; o Metsho gewog - Dowashing, Ungar, Khini, Zhongma, and Pelphug monasteries; Traditional pottery works at Gangzur; Several ney (pilgrim) sites; Tsechus (festivals) in the Dzong and many monasteries Natural attractions Kenpajong tsachu (hot springs) located 2 days walk from Dungkhar ; Tsatiyang tsho (lake) under Jaray gewog; Rafting and kayaking; Bird watching in several areas; Day hikes and treks
TRASHIYANGTSE
Cultural products/attractions Old and new dzong; Zorig Chusum Institute (Arts and crafts) Lhakhangs (monasteries) gewog wise: o Yangtse gewog – Chorten kora; o Tongmizhansa gewog – Thrichu, Pang chorten, Tokaphu lamai, Tokaphu mang, Thrichu zongtopelri, Bainakhar, Kenmong, Changmadung, Gomkora; o Boomdeling gewog – Rigsum gonpa, Pelri Gompa, Dechen phodrang; o Khamdang gewog – Lengkhar gompa, Zongtopelri, Shakshing gompa; o Toedtsho gewog – Jangphu, Gongza, Nangkhar, Darchen, Omba; o Jamkhar gewog – Choeten, Labar, Dromshing, Golomzor, Nyinda, Tachemo gompa, Shingkhar, Jitsam gompa, Nilamdung; o Ramjar gewog – Dongphu gompa, Dodril gompa; Sacred pilgrim sites Several tsechus (festivals) Doksum Iron bridge Traditional paper making Traditional wooden bowl craft
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Natural attractions Nature treks Bird watching Biking Rafting Butterfly watching especially the rare Ludlow’s Bhutan Glory which is only found in this district Bumdeling Wildlife Sanctuary
f. Eastern Circuit 1 Market Value Chains
In tourism, a value chain is a set of activities performed within the tourism sector to deliver a valuable product or service for the market. In other words, a value chain is defined by the end products and services. In the context of tourism, one needs to consider what tourists, tour operators/agencies, accommodation and service providers, and guides need and purchase in order to understand the potential benefits and impacts from tourism development.
Figure 8: The Global Value Chain of Tourism (Spescha, G. & Reutimann, G. Sustainability Matters)
One of the primary objectives of promoting tourism in the east is to spread the benefits of tourism to provide supplementary income and employment opportunities. By identifying the value chain for the three dzongkhags under Circuit 1and understanding the products and services that are utilized by tourists, development
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can be focused on improving participation and inclusion in the growing tourism economy.
Table 15: Existing Circuit 1 Tourism Market Value Chains and Their Potential
Value chain Products/services Impact analysis 1 Accommodations Hotels, home stays, campsites Hotels in Mongar have a better advantage. Benefits in Lhuentse and Trashiyangtse minimal. 2 Treks/excursions Day hikes, trekking, monastery Local festivals more popular visits, bird watching, local attractions festivals 3 Farm produce Cheese, butter, vegetables, eggs Hotels are able to source farm produce for guests 4 Manufactured Juices, food items not produced Hotels and restaurants beverages, food locally source these items items 5 Transportation Porters, pony Minimal benefit 6 Art and crafts Wooden bowls, traditional Although benefits on site paper, cane/bamboo products, may be minimal due to low clay pots, souvenirs, Thangka visitation, items are still paintings sourced for urban markets. Potential to create local markets via cooperatives or other avenues. 7 Textile weaving Silk kiras, gho Some benefit but more popular for domestic market 8 Communication Telephone and internet services Higher demand on internet and information services services
On-going analysis of the value chain will be important as tourism development moves forward in Circuit 1. g. Tourism Stakeholders in Circuit 1
Tourism, due to its multi-dimensional nature, has many different stakeholders at multiple levels of engagement. For any tourism development to proceed successfully, stakeholders at all levels must be involved in the decision-making process around tourism development, as well as with its implementation. The figure below offers an easy-to-understand graphic of the stakeholders involved in Circuit 1,
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categorized by the national, dzongkhag and local levels. Given the many stakeholders involved, a coordinated approach to tourism development is very important in order to have the maximum opportunity for success at all levels.
NATIONAL DZONGKHAG LOCAL Dzongkhag administration Tourism Council of Bhutan (TCBs) Community people representing all sectors Association of Bhutanese Tour Operators (ABTO) Private organizations like Home stay owners Hoteliers Department of Culture Government Forest and Parks Department of Immigration extension staff (Thrumshingla NP, Bomdeling Ministry of Agriculture & Forests WS) (MoAFs) caretakers of monasteries Guide Association of Bhutan
Bhutan Chamber and Commerce (BCCI) Hotel Association of Bhutan (HAB) Royal Society of Protection of Nature (RSPN) Relevant donor agencies. eg. WWF, ACO, World Bank
Figure 9: Circuit 1 Tourism Stakeholders (Based on Field Research, June 2015)
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III. Developing a Tourism Economy in Eastern Bhutan
a. Circuit 1 SWOT Analysis
STRENGTHS WEAKNESSES
High potential for marketable attractions Lack of infrastructure to support increased including: tourism o Protected natural areas Condition of roads is poor, making driving o Strong cultural heritage difficult, long, and unpleasant for tourists Strong adventure tourism opportunities No reliable nearby air service to assist with Unexplored and untouched by outside transporting visitors in and out of the area visitors – can be marketed as one of the Many areas are difficult and arduous to “last frontiers on earth” reach Cultural handicrafts – weaving, wood Lack of information and marketing of the carvings, paper making, other crafts area to potential visitors Traditional and cash crop agricultural Poor quality of visitor services on offer: production restaurants, accommodations, guiding Strong interest in tourism development in specific to the attractions of the area are of among all levels of stakeholders an insufficient quality to attract visitors Lack of coordination in regards to tourism planning and development, with no clear national and local structure for decision- making, implementation, monitoring and evaluation, so that efforts made to improve tourism offerings result in an increase in visitors No incentives for tour operators and tourists to visit this area of Bhutan Lack of capacity of those interested in or already involved in the tourism sector Lack of accessible training for those interested in participating in the tourism sector Lack of access to markets and visitors for other tourism-related goods and services – i.e. handicrafts, food and provisions, other services Lack of financial resources
OPPORTUNITIES THREATS
Development of specific tourism products in Instability in the region leads to a decline in Circuit 1 to appeal to a different tourist tourism visitation – whether due to political demographic instability (India border), natural disasters Attracting new visitors, not presently coming (earthquakes like the one that struck to Bhutan, with a different type of tourism Nepal), instability in source markets (i.e. product – more adventurous, more active, political unrest in Thailand or India), etc.
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Devising a specific and distinct identity for Highway construction impedes the flow of Eastern Bhutan that will differentiate it from tourists into the area, or makes getting to the rest of Bhutan attractions more difficult and unsightly Road developments will enable better Air service into the area is very limited and transportation possibilities for visitors as the unreliable, and remains so roads are complete Opportunity to focus on homestays and B&Bs to increase visitor’s exposure to Bhutanese culture, and to help improve rural livelihoods Tourism projects already established in western Bhutan ( such as Phobjikha homestays) can offer lessons learned and training as Eastern Bhutan develops its own tourism
b. The Importance of Tourism Development in the East
The development of tourism in Eastern Bhutan is necessary to not only generate revenue towards GDP, but also to develop tourism in a manner that contributes to alleviating rural poverty. When properly managed, tourism that ensures a high level of community involvement and strong, established linkages to stakeholders in rural communities has the potential to benefit impoverished groups by allowing direct participation in a revenue generating tourism economy: “If tourism is managed with a strong focus on poverty alleviation, it can directly benefit the poorer groups through employment of local people in tourism enterprises, goods and services provided to tourists, or the running of small and community-based enterprises, etc., having positive impacts on reducing poverty levels” (UNWTO Tourism and Poverty Alleviation, p. 1). In the Circuit 1 dzongkhags, the question is not whether tourism can be used to provide some economic benefit to poorer communities; rather, tourism is seen by many Dzonghas (Dzongkhag administrators) as a major opportunity, and in some instances, such as in Lhuentse, as among the only opportunities for income generation in the impoverished rural provinces.
With the goal of driving revenue to reduce poverty firmly in hand, the question of tourism development in Circuit 1 needs to be focused on directly addressing the challenges that have impeded current tourism growth in the east. Furthermore, the
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strategy for tourism growth needs to establish strong linkages between local and national stakeholders, and a high level of local community involvement is paramount. In order to engage both men and women in the industry, it is crucial that Bhutan enable proper training, and establish standardized hospitality education for all workers/stakeholders in the industry. Whether operators, guides, homestay hosts, or hotel managers, these stakeholders must have a level of training that is not only suitable for Bhutan’s current tourist market, but is also groomed for any new demographic that will be targeted as part of the Circuit 1 strategy. The establishment of a tourism training program in the eastern region of Bhutan is critical in order to develop a strong work force, which will be needed to sustain tourism growth in the eastern circuit. c. Current Tourism in the Circuit 1 Dzongkhags
In alignment with Bhutan’s Tourism Strategy and Development Plans 2013-2018, Bhutan has prioritized shaping its tourism strategy to ensure direct benefits and growth to the eastern region. While Bhutan’s international (and regional) tourist arrivals continue to grow year over year, these tourists are concentrated in the western and central districts of Thimphu, Paro, and Punakha. While some international tourists also visit Bumthang and Trongsa, very few make it out to the eastern dzongkhags of Mongar, Lhuentse, and Trashiyangtse. These districts, by contrast to those in the west, suffer from infrastructural underdevelopment, rural poverty, and a lack of economic opportunity leading to rural-urban migration – in this case, from the east to the urban centers of the west – in search of better economic opportunity. This problematic migration contributes to prohibiting the development of a skilled and educated work force in Mongar, Lhuentse, and Trashiyangtse. The Tourism Strategy and Development Plans 2013-2018 identifies “a critical lack of trained guides” and “a critical lack of skilled labor engaged in the hospitality sector able to meet the needs of 100,000 tourists per year” (p.13). The lack of tourism industry skills in the workforce is particularly acute in the east and this lack of skilled tourism capacity sustains underdevelopment in the region. Bolstering the skillset of the regional workforce and ensuring that tourism industry education is provided to
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stakeholders are items of paramount importance to Bhutan as it seeks to grow tourism in the eastern region.
Given the highly structured nature of Bhutan’s current tourism paradigm, in which international tourists are required to pre-book with a licensed guide and tour operator, these same tour operators, guides, and hospitality workers have a tremendous impact on the standards and perceived value of Bhutan’s tourist experience. The issues with a lack of tourism and hospitality training are exacerbated in Mongar, Lhuentse, and Trashiyangtse. These provinces are far from the Western Circuit tourism hubs of Paro and Thimphu; there is no regional hospitality school, and “the very low volume of tourists visiting rural areas…is insufficient to provide a regular and reliable income source and business incentive” (TCB, p. 14). Because of the impact that tour operators hold in Bhutan, dominance in the marketplace by a few tour operators means that tourism income is further marginalized into the hands of a few: TCB’s data indicate that the top twelve [operators] account for around 41% of total tariff paying arrivals and the top six just over 30% of all tariff paying arrivals. (TCB, p. 10). Because most major tour operators focus on the western circuit, the income generated through the tours continues to reside in the western regional economy, with very little trickling into the eastern provinces. Because of the lack of diversity in tourist lodging in the east, overnights are concentrated in a few tourist hotels,10 primarily in Mongar and Trashigang.
In the case of Trashiyangtse, for example, there is no tourist hotel in the dzongkhag or main town of Trashiyangtse. Tourists stay in Trashigang – in a tourist hotel that is outside the local town – and experience Trashiyangtse on a day trip. With the exception of perhaps a few small souvenirs purchased in Trashiyangtse town, no significant income reaches the villagers, which compounds the town’s
10 By tourist hotel we are referring to the three star level that is guaranteed with the US$250 daily spend. Even if ranked as appropriate for tourist groups, many of these hotels have lower standards of service, lodging, and amenities than their similarly ranked counterparts in the west.
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underemployment and sustains its poverty.11 While there are several local guesthouses and homestays in the town, and enough activities nearby to warrant a 2-3 night stay, the tourist day-trip visitation as it currently occurs guarantees little to no economic benefit to the local community. In fact, due to booking in a tourist hotel so far out of Trashigang town, no significant income goes into the Trashigang community either. In sum, the overarching issues laid out in this section are as follows: Very few tourists venture to the east; Of the tourists that venture east, the exclusive booking of certain hotels and itineraries guarantees that an extremely low amount of revenue enters the rural economies, this is especially true for Trashiyangtse and Lhuentse; Mongar is more centralized and acts as a transit point for the major roads heading east; some tourism revenue reaches this more developed town. d. Assessment of Challenges to Tourism Development
While the current paradigm limits tourism revenue from reaching local communities in the eastern region, there are several other factors that impede growth: lack of a coordinated institutional structure of decision-making and implementation, coupled with a lack of monitoring and evaluation to guide tourism development at the local level; difficult overland road access, limited air transport, poor quality of lodging and accommodation, and no contextual positioning of the region in the international tourism marketplace further limit growth.
Institutional Structure
While TCB’s intention is to establish a Circuit Tourism Committee to oversee the implementation of a Circuit Tourism Development Plan, this has not yet taken place. At the dzongkhag level, the dzongkhag administrators in the three dzongkhags of Circuit 1 have worked to develop extensive inventories of their attractions. In the
11 Trashiyangtse suffers from a prevalence of alcoholism, brought on, in part by the rampant poverty and lack of social and economic opportunity in the town. While the alcoholism pertains mostly to the male population, it impacts women, children, and the community at large. During our stay in Trashiyangtse, this issue was brought to our attention by multiple locals, and cited as a major social issue for the town. Circuit 1 Tourism Development Plan, Draft Page | 53 August 2015
case of Mongar and Trashiyangtse, a comprehensive list of tourism products including tours and circuits has been published in colorful booklets that form part of the dzongkhag’s tourism development plan.
What has been lacking is a clear vision and an organized structure for tourism development to proceed. Although TCB has emphasized the importance of tourism development in the east and tried to improve tourism services, there still remains a large gap in the capacity to understand and manage tourism development. Although the local communities are considered important stakeholders and partners, the lack of true awareness and understanding of tourism makes it difficult for them to effectively participate in its development.
TCB stationed a Tourism Officer in Trashigang for three years, ending in June 2015, yet none of the three dzongkhags in Circuit 1 were aware that such a position or person even existed. The methodology for implementing any kind of tourism development consultations was not made clear, thus each of the three dzongkhags has been working in isolation, with little understanding of all of the components needed for tourism to develop, and without clear guidance and direction.
Identifying a Tourism Officer in each of the dzongkhags and providing the needed capacity-building and support for the position, along with a structured process for consulting, managing, and making strategic decisions will be a critical step to moving tourism development forward in Eastern Bhutan.
Overland Access
The roads connecting the provinces of Mongar, Trashiyangtse, and Lhuentse with the west are underdeveloped, under construction and lengthy. Heavy erosion and major construction in some areas makes the overland journey from Paro to Eastern Bhutan very difficult and even painful for international tourists not used to such difficult conditions. For a tourist who has booked a 7-10 day trip to Bhutan, spending
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three days in transit to reach the eastern provinces, no matter how impressive the attractions might be, is a strong deterrent. Road construction exacerbates the already lengthy transit times, as certain road sections only allow traffic through during limited, specific hours. The constraints of these road blocks are not only difficult to schedule around, but they can prohibit tourists from visiting certain attractions in order to not miss road openings. While road construction may eventually improve road quality on national highways, it is important to factor in the impact that these road blocks have (and will continue to have) on Bhutan’s tourism economy, particularly for tourists looking to transit to the far eastern region over the next several years, during the ongoing highway construction.
While the views along these roads can be quite stunning – and have potential to be marketed as tourist attractions – the physical distress endured on these six to seven daily hour drives to the east from Paro and Thimphu, over multiple consecutive days, will continue to limit both the amount (and the kind) of tourists who can handle an overland journey east: “Next to poor garbage and waste management practices, a lack of variety in restaurants and a lack of public toilets and restrooms on major routes, slow and poor roads are most frequently cited as the main source of visitor dissatisfaction in the 2011 TCBS Monitor” (TCB, p. 9). The lack of a road “circuit” does not help the case for driving either. The fact that tourists would be driving back along the exact same stretch of highway is not ideal. If Bhutan had either a different exit or entrance strategy to the region, for example by air, it would both diversify the view of the guests and cut down on the immense time traveling overland. The solution to the problem of road quality is not an easy one, given the natural terrain of the country and the condition of the roads at large. The solution cannot simply be “build the roads faster” or wait to for it to eventually finish. Rather, Bhutan must realize that road blocks and continued construction over poor quality roads is (and will continue to be) a major deterrent to tourism growth in the east. Recognizing this issue, critical thinking into alternative methods of transportation to and from the eastern region, specifically air travel, will be paramount to increasing tourist arrivals to the east.
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Access by Air Transport
The lack of a functioning eastern regional airport is a limiting factor for Bhutan’s eastern tourism economy. While there is an airport in Bumthang, flights to this airport are seasonal, limited, and often do not sync with international arrivals or departures. Due to the changing weather in Bumthang, scheduled flights are often cancelled or delayed. Despite these limitations, better management of the airport in Bumthang has the potential to improve access to the region. One issue cited by multiple Dzonghas, however, is the lack of demand for air travel to Bumthang. Without a consistent demand for the flights, Drukair has no incentive to provide or offer additional flights12. While Bhutan works to increase demand for visitation to the region, it is critical to realize the importance of regular air access to the success of tourism development in the east.
The airport at Yongphula, which would provide the most direct access to the far eastern region (Bumthang to Mongar is still a seven hour drive), is underdeveloped and there are currently no commercial flights scheduled from Paro. Due to the size limitations of the runway, Drukair’s Airbus 319 cannot land at the Yongphula runway. One question is whether Drukair would consider using its ATR 42-500, a smaller aircraft which currently flies from Kathmandu to Bhutan. Additional funding for the infrastructure of the Yongphula airport could potentially enable larger aircraft to land in the long term, and the use of an ATR 42-500 could enable consistent access in the short term until market demand for the flight route increases significantly. Using Yongphula airport as an access point to the east, by providing a flight route from the west, will enable tourists to bypass one (or both) legs of the three day overland route. Given the ongoing construction on the highways, flight access into the far eastern region is a solution that can enable more tourists to reach the east in a shorter period of time.
12 During a meeting with the Managing Director of Drukair, he stated that if there is demand, they will offer more flights to meet that demand. Circuit 1 Tourism Development Plan, Draft Page | 56 August 2015
In order to best utilize the airports at Yongphula and Bumthang to facilitate timely and relatively stress-free access to the eastern provinces, both airports should not operate as isolated enterprises, but instead as part of a coordinated network of tourist circuits. The goal should be to provide flights that sync with international air arrivals and departures to Paro airport. For example, a tourist may fly from Singapore, land in Paro, and then connect to Yongphula later that afternoon where s/he could begin a tour of Eastern Bhutan. S/he or may transit overland to Bumthang, fly from Bumthang to Paro, spend a few nights in the west, and fly out of Paro International Airport. In this example, the tourist would have experienced both eastern and western provinces in Bhutan with the ease of coordinated air travel. This type of coordinated, careful management would ensure that local internal flights are at a fuller capacity when flying; their frequency may be scheduled according to the demand of tourist bookings. The establishment of a regionally connected air transit network, in which both Bumthang and Yongphula airports are fully functioning entities, has strong potential to enable an increased number of tourist arrivals to the east, to provide more tourist dollars to the rural economy of the region, and to limit the revenue loss of tourists who are deterred from visiting the east due to the difficult and lengthy overland route.
Standard of Lodging and Accommodation
The lodging available in the east is widely acknowledged to be at a much lower standard than what is available in the west. In fact, two of the provinces in Circuit 1 do not even have a reputable hotel at the 3-star standard: Lhuentse and Trashiyangtse. Mongar has one tourist class hotel, the Hotel Wangchuk. All three provinces have some homestays and guesthouses, with low levels of service and inconsistent quality standards. The lack of acceptable tourist lodging presents several significant challenges to the development of a strong tourist economy in the east. The first challenge is the fact that service and hospitality training lack to such a degree that they cannot hit the standard of what an international tourist would expect, especially given Bhutan’s current global reputation as an expensive travel
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destination. In the region, there is limited knowledge and understanding of what tourists expect, what they like, and what to them is considered a value for the price point. This lack of understanding impedes the development of the tourism economy because it means that visiting tourists see the value of Bhutan’s east as lower than the value of its west. Since both destinations are currently marketed under the same umbrella, and the daily minimum spend of US$250 a day per person is the same anywhere in the country, the lack of adequate lodging standards in the east means that tourists can come away from the experience dismayed and dissatisfied. TCB cites two examples of this in the Tourism Strategy and Development Plans 2013- 2018: “Guides with insufficient training acting as tour leaders – and providing a substandard or less than optimal service and experience; tourists being accommodated in low quality hotels (while being aware they are paying the same tour price as tourists in substantially better accommodation).” (p. 22)
In the age of social media, rapid information communication, and increased globalization, it is important for Bhutan to realize that negative experiences have the potential to be shared at immense speeds with large populations of global travelers via the internet and other social media. In order to combat the lack of understanding, training, and knowledge of international hospitality standards, Bhutan must establish strong guidelines for hospitality training in order to participate in the tourism industry, especially at the licensed hotel level.
While the region may be lacking in sheer number and quality of hotels, homestays are prevalent in the region and present a greater opportunity for the direct economic gain of local peoples in rural or remote villages. There is a booming market for homestays among international tourists, although they appeal more to certain segments of the travel market. Younger travelers seeking more culturally authentic or experiential travel can be interested in a homestay experience in Trashiyangtse; however, for an older traveler of 55+ years, the rugged experience is much less appealing. Homestays have tremendous potential in Circuit 1 to both provide direct economic gain to local communities – a pillar of sustainable tourism – and to also
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provide a unique and culturally authentic experience that can help differentiate the rugged eastern region from the tourist market in the west. In places that do not have a tourism level hotel in place, like Trashiyangtse and Lhuentse, homestays can provide needed accommodation. A developed and properly managed homestay market in Lhuentse and Trashiyangtse could quickly increase bed nights in locations where hotels do not currently exist.
While homestays and community lodging have potential to combat rural based poverty through responsible tourism, homestays in these provinces suffer from both a very low service standard and a general lack of understanding for what a marketable “homestay experience” actually is. Homestays – in which a visitor is hosted in the home of a local family – should provide a unique, engaging cultural experience for the international traveler. The visitor should have the opportunity to learn from the family about customs, daily life, food preparation, and family history. The goal is to both provide the family with a means of direct income, and to provide the tourist with an enlightening cross-cultural experience that s/he would not be privy if staying at a hotel. Service, albeit widely acknowledged to be at a lower standard than a starred accommodation, should still be at a level that is in line with international homestay standards. Guests should be comfortable and feel cared for. Cleanliness and access to clean, hot water is critical. As the homestay is a unique cultural experience, the homestay should really be a model for what a traditional or rural Bhutanese home means. The current understanding of a homestay in the Circuit 1 provinces is not focused on providing a unique and culturally attractive experience to international travelers, and instead leans towards the idea of simply providing a room in a house, which may or may not contain the basic facilities needed to host international visitors or involve any interaction with a homestay family.
For example, in a homestay in the Lhuentse village of Khoma - a tourist destination as a “weaving village” – there was no heated water or sink. A simple meal was provided, but there was little regard for cultural context; no explanation of the local
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dishes was provided and no orientation to the village was offered by the hosts. Although English language proficiency is an issue for many rural Bhutanese, all tourists travel with a guide who is able to translate between the two languages. However, in homestays visited during the field research portion of this consultancy, there was no effort on the part of the hosting family to share any part of their home life, or provide insight into the village community they were a part of. Khoma village, while in a picturesque valley, was unclean and strewn with trash, rubble, and animal waste. Sanitation was very poor. It was evident that despite tourists visiting the village to see the weavers, little initiative was taken to beautify it in an effort to increase tourist visitation.
The example of Khoma underscores three major limiting factors to the development of a rural based tourism economy and in the marketability of Bhutan’s Circuit 1 homestays:
First, there is a lack of understanding of what basic infrastructure should be in place in order to host international tourists. While a homestay is acknowledged to be a more rustic mode of accommodation, it is crucial that specific amenities be in place for international tourists, such as heated water, a clean bathroom, a clean bed and towels. As part of our Circuit 1 tourism strategy, this report will advocate that TCB develop a service and infrastructure guide for homestays in the region modeled on the successful homestay program created in Phobjikha by the Royal Society for the Protection of Nature (RSPN). But beyond a standardized set of homestay guidelines, it is crucial that these guidelines are implemented. Homestay standards need to be continually managed and improved by TCB or another appointed group of trained tourism officials, such as the Circuit Tourism Committee. It is critical that these officials – managers of homestay standards – have homestay hospitality training and are active and engaged in coaching the development and proper management of rural homestays.
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The second major issue to be addressed is a revision of what a homestay means in the context of Bhutan’s national tourism strategy. The homestay needs to move away from the concept of a rented room and into the sphere of international homestay standards, in which the hosting family (and the lodging itself) provides a culturally engaging experience that is a marketable entity and has appeal within the international tourism market:
“In its purest form, a true homestay requires the host to be present, and the host to add value. Value is defined by the traveler's desires: language immersion, a shared interest in Renaissance art, an interest in winemaking, a local guide. As experiential and adventure travel grows — adventure travel is a nearly $300 billion market now according to the Adventure Travel Trade Association — travelers want to pair their sightseeing and activities with a comparably-exciting lodging experience.” (Clarke, Alan. The Rise of Experiential Lodging)
Homestay hosts need to engage directly with tourists. Examples of homestay activities could include: helping with food preparation; education about religious practices in the home; showing tourists around the community and introducing them to neighbors/friends; inviting tourists to join in cultural activities such as weaving, handicrafts, or farming. The homestay, in this new paradigm of adventure travel, moves from the realm of basic accommodation into the role of cornerstone, or highlight, of the traveler’s experience in the east.
Finally, if a location is seeking to host international tourists, efforts must be made to beautify the village or town: trash residue and construction rubble must be cleaned up, and animal waste must be managed and removed from the footpaths. The solution is not only instituting proper protocol for trash disposal, but changing the idea of what constitutes residue and thus should be removed. The Tourism Development Plan for Trashiyangtse Dzongkhag also cites this as an issue with Trashiyangtse town. While “the town has become cleaner with regular garbage
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collection and clean-up campaigns…Heaps of wooden beams, sand and gravel and apparently abandoned machines are rusting and resting at the roadside” (Van der Poel, p. 29). This report was published in July 2014; however, in 2015, no change was apparent and refuse, rubble, and rusting machinery were still strewn about the center of the village. The need to change trash management and what constitutes unsightly rubble is underscored by the fact that Trashiyangtse, despite the ongoing issues noted, regularly “finishes first or second in the cleanest town of Bhutan competition” (Van der Poel, p. 29). Town beautification, involving the removal of rubble and more consistent and rigorous trash standards requires little overhead investment; rather it requires diligent management and can ultimately have tremendous impact in encouraging tourists to seek out local accommodation or stay for longer periods. A town’s presentation and beauty should warrant tourists to ask their guide, “Why aren’t we staying here tonight?” (Van der Poel, p. 29). e. Sustainable Tourism Development in Eastern Bhutan: Contextual Development and Differentiation
In acknowledging the challenges to tourism development in Bhutan’s east - access to the region, standard of lodging, and community involvement - there is a broader regional challenge to developing a successful tourism economy in the underdeveloped eastern provinces: a lack of guiding vision for how the region can offer a unique experience from the west. In charting the path for tourism growth, the east must seek out ways to differentiate from the west, in terms of the experiences offered, the travel demographic targeted, and the underlying ethos of the region itself. Simply put, when one asks the question, “What makes Eastern Bhutan unique?” the answer must include attractions, culture, and a regional aesthetic that is somehow different, yet no less valuable, than what is available in the west. From a logical standpoint, why would a tourist spend days traveling to the eastern provinces if they are able to have a comparable experience and see similar (if not better) attractions in the western region? In charting a vision for the east, Bhutan must not only look to inventory possible attractions, but rather seek to develop the attractions that are unique and different than what can be found elsewhere in the
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country. If a tourist can see remarkable Dzongs in Paro, Punakha, and Thimphu, then simply noting that there are interesting Dzongs in the east is not going to garner tourist attention. If there are cultural festivals in the west, then the cultural festivals highlighted in the east must be different enough to warrant a visit.
Developing a context in which Bhutan’s east can appeal to travelers is important so that Bhutan does not cannibalize its western market. Simply displacing tourists from Thimphu and Paro to Mongar or Trashiyangtse does not increase overall tourism revenue for Bhutan, it simply relocates the revenue and visitation. The goal is to grow both eastern and western markets by attracting more tourists, period. Thus, the tourism strategy must be founded on differentiation – both in terms of attractions, and in terms of market segmentation: attracting a new and different market that is not already visiting Bhutan (but would want to). In looking for the attractions that will drive revenue to the east, Bhutan must keep in mind the flaws of the old adage: “If you build it, they will come.” Just because the east has Dzongs, temples and festivals, does not mean that tourists will flock there. If that system was working, then Bhutan should already have a booming industry in its east; but it doesn’t. Even if these attractions were more visible on the international market than they have been, it is still no guarantee of increased visitation. Less focus should be given to the inventories of every kind of tourist attraction in the east, and more thought given for how to develop a specific set of attractions into world-class, one-of-a-kind experiences that a tourist could not find elsewhere. Starting out with a select, targeted set of activities and experiences and growing from there is a strategy that can ensure carefully managed tourism growth for Eastern Bhutan.
Adventure Travel
Adventure travel, defined here as “any domestic or international trip that includes at least two of the following three aspects: physical activity, interaction with nature and cultural learning or exchange,” (ATTA Adventure Tourism Market Report, p.4) is the strongest option for the east. The east already has the attributes of a more rugged,
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adventurous, off-the-beaten-path destination. Syncing the adventure tourism market with this region in a specific, well-managed marketing campaign can be a beneficial strategy for the region. Once this overarching context is adopted, the strategy will help guide decisions on what type of attractions to develop foremost, how to develop them, and how to market them.
Development of adventure activities – such as hiking, mountain biking, kayaking, or rafting trips – is a key component to developing an adventure travel market in the east. It is important that the development of each activity be done to a world class standard, even if in a more remote location. The focus should be on developing quality over quantity, with attention given to location and duration of activity. For example, in the case of mountain biking: a location for this activity should be carefully chosen; the route should be groomed for safety; bikes and wares should be selected carefully, and a plan for maintenance developed, in order to ensure that the bikes stay in good condition over multiple uses. Different routes should be offered, with varying lengths, as well as the opportunity to link in other activities – such as camping, or stopping overnight at a homestay – in order to appeal to different tourists. A similar approach of careful, diligent planning should be taken with other adventure activities – the focus once again being on quality over quantity as the east moves forward in the short term.
Art and Spiritual Tourism
The east can also offer the opportunity to market art and spiritual tourism, a growing niche in the tourism industry. If the east were to offer the opportunity for a more focused look at religious art, history, and practice – as part of a specific circuit or route – the region once again has the opportunity to offer something distinct from the heavily trafficked west. But in order to develop this type of spiritual art and historical tourism, a select group of guides will need to be expertly trained in specific, pertinent knowledge. Currently, guides – while they may have some baseline knowledge of the history of the temples – lack the detailed education of a specialist, who could
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carefully explain the significance of the different rooms, practices, and assortment of deities that make up the Vajrayana practice. A circuit or route should be developed that not only showcases a variety of artistic styles, but showcases styles from a variety of time periods, in order to help tourists who are interested in this field gain a firm understanding of the development of religious art and thought through the history of Bhutan. Tourism focused around art history is a growing segment of the broader field that has gained traction in countries that have a rich tradition of visual art (whether religious, secular, or both). In Italy for example, art history tours are offered by a number of national and international tour operators, and focus on specific periods, mediums, or even regions in the country. A similar type of tourism could be developed in Bhutan, where highly trained operators can provide insight into the art, history, religion, and techniques in the Buddhist kingdom.
This is not to say that there will not be some overlap between the east and west, but the overarching idea is that the eastern region can warrant a deeper dive into Bhutanese culture and nature than the west. The east presents the traveler with an opportunity to really experience one of the last frontiers of Buddhist culture and adventure tourism.
But differentiating the offerings and experiences of the east is not enough to garner the amount of eastern visitation that Bhutan seeks. The question of “Who?” the east will draw is paramount to the discussion of bringing the region into the world of international visitation. In the following section, this report examines the type of traveler that would not only be interested in the region, but whose interests match the current offerings of the region. If Bhutan is looking to develop its tourism sector revenue and increase visitation in order to stir economic development, Bhutan must look at how to bring in more tourists, and source a larger demographic pool. Our strategy looks to two important demographics. The first demographic – adventure travelers – comprises one of the fastest growing, and largest, travel markets in the global tourism industry. These travelers unite around adventure based activities, experiential tourism, and authentic experiences in unique destinations. The second
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demographic is comprised of millennial travelers, who will be reaching their prime working, earning, and spending years over the next decade. Our recommended strategy utilizes both demographics in order to capture a tourist market that is primarily under the age of 55. f. Seeking a New Travel Demographic: Adventure Travelers Adventure travelers are leading the drive for “Experiential Tourism” – where the travel experience is based around cultural and natural heritage, along with immersive, hands-on, enriching and educational experiences. Experiential travel is now the focus of major international travel organizations; for instance, Virtuoso, the largest luxury travel network in the world, has declared “Authenticity is the new luxury.” Recognizing the global demand for experiences that cater to the unique, the authentic, and the emotionally enriching, Virtuoso now directly markets holidays to travelers who seek to “Travel with Meaning.” While Bhutan is seen as a culturally rich destination, its eastern region has the opportunity to capitalize on the adventure traveler’s desire to go beyond the ordinary, and take a deeper dive into Bhutan’s ”last frontier.” The Circuit 1 and 2 provinces can cater to the adventure traveler seeking authenticity, who craves exploring remote villages, taking part in the daily activities of a rural homestay, and being surrounded by pristine, wild nature, and is willing to undergo rugged travel conditions to have these experiences.
The adventure travel market is growing fast, and the potential to drive economic benefits to regions that successfully harness its power is strong. In partnership with the Adventure Travel Trade Association, George Washington University13 published the 2013 Adventure Tourism Market Report. The results of this consumer and market study revealed a staggering growth in adventure travel: 65% year over year growth since 2009. Adventure travel is now a US$263 billion industry and continues to grow. The United Nations Report, Tourism and Biodiversity: Mapping Tourism’s Global Footprint, also underscored this conclusion, citing that “Nature and adventure travel remain among the fastest growing segments of the global tourism industry.”
13 George Washington University is located in Washington D.C., USA.
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According to the George Washington University adventure tourism study: The age range of the adventure traveler is 25-50 years old with an average age of 36 years. 57% of adventure travelers are male; 48% of adventure travelers are single or have never been married. 21% travel of adventure travelers travel with friends, 37% with a spouse or partner; 30% travel with their family and kids. The value of the outbound adventure travel market from the Americas and Europe (these two regions make up nearly 70% of the world's international tourism departures) will soon surpass US$300 Billion. On average, an adventure traveler's per-trip spending on the ground has been increasing at a rate of nearly 20% increase annually to approximately US$1000-US$2000 per trip based on 10 days (excluding airfare) or about US$100-US$200 per day.
While adventure travel is a fast growing sector of the tourism industry, the adventure travel market is not budget tourism, and the travelers themselves maintain a very different set of values than their mass tourism counterparts. These are young professionals who are engaged in the world, are interested in exploring far-flung destinations if the value of the experience is authentic and challenging. To these travelers, however, a US$250 daily spend is a deterrent, and above their daily price range. Since adventure activities comprise a major part of their travel experience, if given the opportunity, these individuals are willing to travel to remote areas under difficult conditions for a deeper, more authentic and active experience; in other words, they are a market to target in developing tourism in Eastern Bhutan. g. Seeking a New Travel Demographic: Millennials
As Bhutan charts its tourism strategy of growing tourist arrivals and bed nights in the east, it is very important that the country engage the millennial travel market, which is ideally suited to Eastern Bhutan’s attractions. This cohort of the global population, widely acknowledged to have been born between 1980 and 2000, is “the biggest in
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US history—even bigger than the Baby Boom,” according to a Goldman Sachs study, and they “are poised to reshape the economy; their unique experiences will change the ways we buy and sell, forcing companies to examine how they do business for decades to come.” As industries across the planet brace themselves for this new generation, it is crucial Bhutan both understand this fast-rising travel market – their unique attributes, likes, dislikes, and habits – and position its tourism market to capture millennial interests in order to grow tourism in the east.
The majority of Bhutan’s tourism economy is supported by international visitors 55 years and older - more than half of all international tourists to Bhutan are 55+ (BTM, 2014). This is just a small segment of the global tourism market. In short, Bhutan’s current approach to tourism is focused on one of the smallest tourism markets, and the country is largely missing the biggest sector by far of the global tourism industry – travelers ages 25-55. If Bhutan wants to grow its tourism market in the underdeveloped eastern districts, Bhutan needs to reframe its tourism model in order to capture a different (and larger) share of the global tourism market. This means attracting younger travelers, who would not only be interested in the unique offerings of the Circuit 1 dzongkhags, but would also embrace the more rugged and adventurous experiences available in the east. Bhutan needs individuals who seek out the culturally authentic experiences that rural based home and farm stays can offer in the eastern region. Together with adventure travelers, noted above, Millennials, given their unique generational characteristics, are an excellent fit for Bhutan’s Circuit 1 tourism offerings. Before examining how marketing to millennials can help grow the Bhutanese tourism economy, particularly in the east, it is important to understand the defining characteristics of the millennial travel demographic.
Characteristics of the Millennial Traveler
There is a shift in values, behaviors, and interests in the millennial travel population. Millennials are more educated than previous generations, with over 60% of US
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millennials earning a university degree. Millennials favor the new sharing economy, which can give an individual access to branded, up-market items without the burden of ownership and debt. These items run the gamut from cars to designer clothes to expensive apartments and condominiums. The travel industry has seen some traditionally stable industries disrupted in favor of this sharing economy – the global proliferation of Uber and Airbnb serving as prime examples. The delay in major “life” purchases – such as a home or car – also mean that millennials have some disposable income, and travel is one of the key industries where they are interested in spending that income.
For millennials, travel is a priority; however, the way in which they travel differs from older generations: “Millennials…believe passionately in work-life balance and take all the vacation time they can. Millennial travelers aren’t doing the typical sun-and- sand vacations or visiting well-touristed cities. Instead, they’re adventurous, looking
for more remote destinations.” (Goldberg, Virtuoso) Studies have shown that millennials crave adventure, experiences that offer a deeper level of knowledge, and an authentic glimpse at how different cultures live: “Millennials have a strong desire to deepen their knowledge of the ‘authentic’ and ‘real life’ outside of their own cultural borders.” (WYSE) A recent study by BCG found that,
“Far more Millennials than non-Millennials report a desire to visit every continent (70 percent versus 48 percent) and to travel abroad as much as possible (75 percent versus 52 percent). Millennials are more diverse as a group than non-Millennials and more interested in international travel and global cultural experiences” (Barton et. al.).
Millennials are interested in adventures that offer deeply authentic experiences. They do not feel constrained by geographical location; traveling to remote and difficult-to-get-to destinations can excite and exhilarate them.
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There are some fundamental implications that are relevant for Bhutan as it seeks to promote the Circuit 1 provinces. First, millennials do not have the same level of discretionary income that an age 55+ or older retired professional does. For Millennials, a US$250 per day minimum spend is a disincentive to visit Bhutan. A liberalization of the daily tariff, as recommended later in this report, will allow Bhutan, and specifically the eastern region, to capture this young, adventurous travel market and to increase the number of tourists and dollars spent in the east.
The offerings of the east could particularly appeal to the millennial generation, as the cohort is not only interested in remote places, but also interested in intensely authentic, cultural experiences. The accommodations – rural, rugged, and lower in standard – which are hard to market to the older, upmarket clientele Bhutan currently attracts, could be successfully marketed to this younger cohort. Younger, more adventurous clientele would be more interested in participating in a rural homestay that provided the opportunity to experience life in a Bhutanese village, than a couple on their 50th wedding anniversary who are looking for luxury, comfort and amenities. The natural offerings of Bhutan’s east also appeal to the millennial travel market. The prevalence of (and development potential for) adventure-travel experiences such as hiking trails, mountains, kayaking, and rugged village cultural experiences, appeal to the younger highly-fit demographic that is interested in adventure: “When considering travel, millennials are almost twice as likely as non- millennials to book a vacation that includes outdoor adventure activities like mountain climbing, hiking, river rafting or camping.” (From, p.1) Finally, millennials are a “sharing” generation in that they use their technology to both gain insight through reviews and online communication, and also use it to showcase their own experiences: “Overall, Millennials report much more reliance than non-Millennials on user reviews, experiences, and online content when they make travel arrangements.” (Barton et al) By successfully harnessing the millennial travel market, Bhutan has the potential to open itself up to a ground swell of online social media and word-of-mouth marketing – a powerful opportunity to expand tourism in the country.
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In examining how to develop tourism in the eastern region, selection of a core client and careful definition of his or her characteristics is important. While many of the attributes of the Circuit 1 provinces do not appeal to Bhutan’s current 55+ older tourism market, it is important to examine whether these same attributes could appeal to a different market. In this case, the answer is yes: the adventure travel and millennial markets. These individuals love to travel, are interested in the remote regions of the planet, and crave adventurous, culture-driven experiences. The current accommodation offerings of the east – particularly homestays - could also suit their needs, as these individuals are not focused on staying at 3, 4, and 5-star luxury resorts, but prefer more authentic opportunities for interaction with local hosts.
h. Liberalizing the Tariff Policy
In addition to differentiating the market, combating the current barriers to tourism development, and cultivating new clientele for Bhutan’s east, another important factor worth serious examination is the daily tariff. As mentioned, Bhutan’s current policy of a US$250 minimum spend is a disincentive to visitation in the eastern region. The current infrastructure – including poor accommodations, difficult access, and rugged tourism activities – cannot support a US$250 daily spend for Eastern Bhutan’s Circuit 1. If Bhutan were to continue charging the US$250 in the Circuit 1 provinces, as it does in the west, it is overvaluing the quality and thus overcharging visitors, running the risk of Bhutan acquiring a global reputation for “high cost, low quality” tourism. This is not new information. It has been detailed in several prior TCB consultancy reports. The Circuit Tourism Development Plan for the TPS circuit, published in May 2013, also highlights the tariff as a major obstacle to growing tourism in the east and attracting tourists to visit the region:
“According to the pricing policy, international visitors who pay the minimum tariff should be given a minimum of a 3-star category hotel. Since there were no 3-star hotels in the entire TPS circuit
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until recently, visitors were kept at 2-star and less ratings which impacted visitor satisfaction levels, and as a result have led to poor image quality for the destination.” (Dorji, p. 51).
While this example pertains specifically to accommodation is the east, it is reflective of a broader challenge for Bhutan – tourists are not interested in paying the premium daily spend of US$250 when the quality that they are receiving is far less than what they receive in the west. The lower quality is apparent in the activities, lodging, guide knowledge, and accessibility of the eastern region. The TPS Plan also notes that, “Visitors mentioned that the main reason to visit Eastern Bhutan was for the purpose of seeing what it is like. Therefore there seemed to be no real motivation to experience a particular attraction,” (Dorji, p. 49) and “Interviews with tourism suppliers in the TPS circuit showed that not even a single hospitality staff in the entire TPS circuit has undergone tourism related training.” (Dorji, p. 56) In charting Bhutan’s strategy for tourism development in the eastern region, it is important to recognize that the current pricing policy not only acts as a disincentive for visitation to the east, but carries with it the risk of negative publicity associated with “overcharging” for what is widely acknowledged (both nationally and internationally) as a low value tourism product.
In order to attract the younger tourism market demographic of adventure travelers and millennial travelers, ages 25-55, that will be interested in the unique, rugged experiences in the east, Bhutan should liberalize the tariff, keeping only the Royalty Fee in place for all tourists (international and regional), as recommended in this report’s tourism development strategy, or by reducing the tariff to a total of US$150 per day (including the Royalty Fee). A lower daily price point more adequately reflects the value of the lodging and infrastructure currently present in the eastern region; it will strongly incentivize visitation from the largest tourism market demographic, who cannot afford the US$250 per day spend, but are interested in the experiences that the region has to offer. The lower daily spend will still
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accomplish the goal of avoiding “low value” tourists, while generating the tourist arrivals and income generation to help alleviate poverty in the east.
Bhutan will also need to better market (and explain) exactly what the daily tariff figure includes. Currently, there is confusion in the international marketplace as to what is included, what isn’t, and why there is even a tariff at all. Tourism Strategy and Development Plans 2013-2018 notes the need for “image campaigns to correct the misunderstandings related to the tariff, as well as misinformation about Bhutan being an expensive destination” (TCB, p. iii). This lack of awareness and confusion can deter visitation, as travelers who would consider Bhutan avoid the country as “exorbitantly expensive.” In the award-winning documentary, “Gringo Trails,” (currently showing in cinemas worldwide and to be released on DVD in November 2015), a Bhutanese official states that Bhutan only wants millionaires, celebrities and high-spending travelers. This image is damaging Bhutan, and impacting its growth in tourism arrivals. A clear marketing strategy in which Bhutan shows why it upholds its policy, and what the policy includes, would be valuable to preventing loss in visitation due to confusion over a poorly understood policy. One important attribute to this plan will be information on what programs – social or otherwise - the Royalty Fee goes to support. If proceeds from the Royalty Fee are being used to further education, infrastructure, or other social goods, with correct marketing the royalty fee can be seen as a positive attribute of visiting Bhutan – a way to “travel with meaning” according to sustainable tourism principles. Carefully explained, the US$65 per day Royalty Fee can be a marketing advantage for Bhutan.
The national requirement to pre-book with a tour operator before arriving in country also means that tour operation is consolidated into the hands of a select few: “The tariff system hands tour operators a considerable stake and responsibility in terms of the way tourism activity is conducted and unfolds in Bhutan.” (TCB, p. 14) While a few stakeholders have the negotiating power and market share, their dominance ultimately restricts smaller, more local operators from growing their businesses. This can be particularly impactful in the east, where locally-based tourism providers
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may not have good access to the wider market. It is important to ensure that income earned in the region stays in the region, and directly benefits local populations. If travelers are only booking (ahead of time) with tour operators based in the west, then there is a missed opportunity for locally-based operators in the east to grow their businesses. While this paradigm is not easy solved given the market-hold of Bhutan’s large western tour operators, the Bhutanese government can take measures to help incentivize western tour operators to focus more on travel to the east, and to also encourage smaller operators to enter the market and grow in the east, such as by requiring that tourists select a local operator for certain activities, while using another operator for the overall itinerary and transportation.
Bhutan’s tariff has been at issue for some time, with different stakeholders arguing for or against its increase, decrease, or abolishment: Recognizing the limitations of the tariff, the 2005 “Sustainable Tourism Development Strategy” offered two detailed and carefully explained alternatives. The McKinsey Consultants also strongly advocated to drop the tariff (TCB, p.10). If the goal of the Bhutanese government is to increase visitation, revenue, and pro-poor economic growth in the east through tourism, then it is critical that Bhutanese policymakers recognize the limitations that a US$250 per day spend has on developing tourism in the eastern region. Liberalizing the tariff, in alignment with the other recommendations in this report, will greatly benefit increased visitation in Eastern Bhutan. i. Issues of Gender and Vulnerable Populations
While across the country of Bhutan, the gender equality situation is regarded as relatively favorable, and the participation of men and women in the labor force shows increasing equality, the overall rate is still more favorable to men. As noted in the information presented in the previous section of this report, 72.1% of men and 58.9% of women participate in the nation’s labor force. Further analysis indicates that in rural areas, women are significantly involved in the agriculture and forestry sector, but they are disproportionately involved as unpaid family workers, in both the agriculture and non-agriculture sectors. By comparison, men in rural families are
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three times as likely to be regularly paid employees, while women are more likely to report as self-employed, or to work within the family, work for which they are unpaid. In examining areas of Major Economic Activity, the majority of people in Bhutan are employed in the Agriculture and Forestry sector, with 26.3% of men and 30% of women employed in this sector. This can be interpreted to mean that women’s opportunities to participate in other sectors is being constrained, and it is also an area of the economy in which economic earnings, productivity, and benefits are low. According to the 2013 Labour Force Survey, women are more active in the manufacturing sector (2.4% of men, 3.8% of women), in wholesale and retail trade (3.4% of men, 4.3% of women), and equally represented in the hotels and restaurants sector (1.5% of men, 1.6% of women). These sectors are also more likely to include self-employed workers, as well as family workers, with the resulting unreliability of economic benefits. Women are also more likely to be engaged in cottage and micro-enterprises, endeavoring to supplement income to bolster the family’s main reliance on agriculture. While sex-disaggregated data is not always as robust and specific as we would like, we can nevertheless use the existing data, in addition to field research and visits, to create both a picture of current realities and to devise strategies and actions that can assist in empowering women and other vulnerable groups in eastern Bhutan in terms of the development of tourism. We can also use this information to project how tourism development can contribute to the amelioration of gender disparities, economic empowerment of women, income equality, and poverty alleviation.
Another factor which can illuminate gender-conscious approaches to tourism development in eastern Bhutan is the literacy rate. While literacy rates among young Bhutanese throughout the country are high, literacy rates among adults are lower, and literacy rates among rural women are significantly lower than their male counterparts. Adult literacy rates in Mongar, Lhuentse and Trashiyangtse reflect this overall trend across rural Bhutan, with adult literacy in Mongar at 59.5%, in Lhuentse at 55%, and in Trashiyangtse at 60.4%. (Dzongkhag Individual Five Year Plans). As capacity building is a core feature of tourism development in eastern Bhutan,
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planners will need to be aware of and take into account literacy levels in designing capacity building training programs, particularly if adult rural women are to be encouraged and empowered to participate in the development of the tourism sector in eastern Bhutan.
Table 16: Literacy Rates by Age and Gender in Circuit 1 and 2 by Dzongkhag (National Statistics Bureau & Asian Development Bank 2013 p.113)
General literacy in % Youth literacy in % Adult literacy in % Dzongkhag Male Female Total Male Female Total Male Female Total Mongar 68.5 51.0 59.5 89.8 78.3 84.0 60.2 38.3 48.9 Lhuentse 63.2 47.6 55.0 86.3 79.2 82.0 51.7 36.9 43.4 Trashiyangtse 66.3 54.5 60.4 87.8 87.1 87.5 57.6 44.0 50.8 Trashigang 66.6 54.1 60.1 92.1 85.8 88.5 57.3 42.4 49.5 Pema Gatshel 64.1 48.9 56.1 96.4 84.6 90.2 56.4 37.1 46.2 S/Jongkhar 70.6 53.4 61.7 93.2 85.9 89.5 63.2 42.2 52.5 Bhutan overall 71.6 54.7 63.0 90.4 82.2 86.1 66.0 45.2 55.3
In developing tourism opportunities in eastern Bhutan, it will be important for women in particular, as well as men, to be included and empowered as the tourism economy is developed. Tourism development in eastern Bhutan will favor rural village homestays and farmstays, which are attractive entities to the younger markets that can be targeted to visit eastern Bhutan. In addition, opportunities for developing additional income-generating activities through cottage, micro- and small enterprise development will also contribute to the protection of eastern Bhutan’s natural and cultural heritage, encourage rural Bhutanese to protect and maintain their cultural traditions, and offer opportunities for the development of small markets for agricultural products and handicrafts. With the RGoB’s development of the Cottage, Small, and Medium Industry Policy in 2012 and its efforts to standardize understanding of this crucial aspect of Bhutan’s economy, the Regional Trade and Industry Offices also provided information showing that in the Service sector (including the travel sector), 78% of industries are classified as cottage, 22% are classified as small, and 41.9% are owned by women. Both the size of these businesses and the fact that women are already involved are a base from which
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tourism development can grow in eastern Bhutan, and provide benefits to men, women and their families.
Figure 10: Private Sector Development, Bhutan (Gender Equality Diagnostic of Selected Sectors, ADB)
Further development of these opportunities will need to be supported with capacity building in several crucial areas: training in hospitality skills and small business development, participation in decision making about the process and progress of tourism development at the Circuit level through the Circuit Tourism Committee, and facilitating access to financial resources such as micro-loans and other financial services. Specific attention is needed to ensure that women in particular have access to training and financial resources.
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To accomplish these goals, Bhutan should utilize and build upon already existing training programs that have been implemented in other areas of the country to help develop tourism in the east, with the assistance and coordination of TCB and the local government. For example, an effective and easily implementable community- based sustainable tourism guide has been developed by the Royal Society for Protection of Nature for training in how to manage and successfully operate a homestay business for tourists and guests. The “Homestay Operators Manual for Phobjikha” could be introduced to eastern Bhutan by skilled, successful homestay operators in Phobjikha. Community exchanges between homestay operators in eastern Bhutan and homestay operators in Phobjikha could bring hands-on learning and enhance understanding of how to better the tourist homestay experience and ensure that the operation of the homestay is beneficial to the families participating in the program in eastern Bhutan. Additional hospitality training – such as service training for restaurant and hotel workers, and operations training for small business owners and operators – can be offered in eastern Bhutan, either by the establishment of a tourism resources training center, or by a mobile training unit that offers a series of focused courses that can enhance the business skillset and overall understanding of the tourism sector among the local population. Offering such courses at times and venues that encourage the participation of women will strengthen their ability to participate.
To assure women’s participation at the local levels of tourism development and program implementation, it is important that women are well represented in any established tourism decision-making bodies. Women’s groups or other governmental and non-governmental local groups that include women in decision- making can provide an avenue for women to participate more fully in the development of tourism in eastern Bhutan.
Improving access to micro-lending and other financial services in the cottage and small business development sector in eastern Bhutan will be critical to ensuring private sector participation in the development of a tourism economy. Access to
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micro-credit schemes that allow families to make small investments and improvements and to enter the tourism marketplace without major risk can be a way to encourage realistic growth and participation in an emerging tourism economy. These schemes can allow the economy to develop in a sustainable way, while discouraging false promises of immediate benefit and unrealistic expectations. Micro-credit schemes have a long history of success, when well-developed and well- implemented. For example, BRAC (formerly the Bangladesh Rural Advancement Committee) has been implementing successful micro-credit and other micro- financing initiatives in Bangladesh since the 1970s, and now works around the world to help countries and communities develop their own micro-finance initiatives. Yet while the establishment of micro-lending opportunities is an important step to offering much needed capital for small businesses looking to improve infrastructure and quality of services, these loans and financial services should be coupled with strong business development and management support. Simply put, it would be futile to offer a loan for improving a homestay and then not provide any guidelines for how to invest the capital properly: which services to invest in and which services not to.
As an example, in Trashiyangtse we had the opportunity to meet with a small guesthouse owner. His establishment had potential and it was clear that he was seeking to develop the guesthouse and grow his business. When asked about his plans for further development, he noted that his next big expenditure would be buying televisions for all the rooms: televisions seemed to him to be something that regional guests would want as an amenity, and thus international guests would want them as well. This example underscores the lack of sound planning and knowledge of what international travelers are seeking in a local guesthouse experience. The owner, with proper consultation, could take that same money and invest it in better plumbing, hot showers, better food/beverage services, or guesthouse beautification – improvements that would actually enhance the international guest experience. International guests staying in remote Trashiyangtse are not interested in staying in their rooms and watching Bhutanese television. Rather, they desire a comfortable
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experience with great food and unique activities. Providing a better understanding of the international tourist market to local business owners and ensuring access to business development resources will ensure that capital and micro-loans are invested wisely and in a manner that is in line with eastern Bhutan’s goals for international tourist visitation.
There are additional value-added and supply chain opportunities for rural men and women who may not have immediate access to tourism, due to their more remote locations or lack of access by tourists to reach them, who may nevertheless find ways to participate in the tourism economy by providing goods and services. For example, traditional handicrafts are practiced in many of the small villages of Circuit 1. Establishing a centrally-located handicraft cooperative that provides a market of high-quality goods to tourists and facilitates the participation of women from many different communities, is one way to spread the benefits of tourism beyond the initially few places that tourists visit. The central cooperative can also ensure that fair prices are paid for goods produced, as one of the current complaints heard in the field is that the women producing the handicrafts are forced to sell at unfair prices to middlemen, who then sell their goods at a substantial profit in Thimphu or Paro.
For example, Khoma village in Lhuentse dzongkhag is well known for Kishu Thara weaving, and many women in the village are home-based weavers. Currently, a very small number of international tourists visit Khoma, coming from Mongar for a short 2- 3 hour stop without overnighting. When this happens, all of the village weavers rush to an open slab of cement to show the tourists their weavings in hopes of making a direct sale. Because access to buyers is so limited in the village, the majority of the weavings are sold to middlemen, who buy the weavings at low cost and bring them to Thimphu, where the weavings are sold in shops at much higher prices. The middlemen receive the largest share of the profits for the sale, while only a small percentage of income is received by the female weavers in Khoma. In meeting with the women weavers at Khoma, all said that the single biggest improvement would be
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to have improved access to direct sales to tourist, thus eliminating the middlemen and reaping more of the profits for their work. j. Other Barriers to Tourism in the Eastern Circuit
Unfavorable investment conditions There are few local investors who are interested in leasing government land in order to build much needed infrastructure and boost tourist visitation, but current policy caps land tenure at a 10 year lease. For example, in Lhuentse, two private parties have shown interest in developing hotels, but desire a 30 year land lease; the cap at 10 years was a significant deterrent to the private investment opportunity and the investors did not proceed. Lhuentse Dzongkhag Administration indicated to the consultant team during field visits that they have worked hard to bring tourism investment to Lhuentse town, but that the Government of Bhutan agencies restricted the terms of the land lease to only 10 years, which the hotel developers have thus declined due to the short term limitations of the lease. The Dzongkhag administration indicated that in such situations, it needs support from TCB to help make hotel development more attractive to investors.
Trashiyangtse also has ample land for lease, but little interest due to the stipulations on leasing government property. Seeking to provide more incentives for private developers to invest in property (and projects) could enable more free market growth and increased rural investment.
In addition, many tour operators remain skeptical over operating tours in the east. Besides the longer travel duration, the general perception among the travel operators is, “Why promote and travel all the way to the east when one can conveniently enjoy the same attractions in the west?” Incentives to travel east and invest in tourism development there will be important at different levels of the tourism value chain.
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Expiry of tax holiday The tax holiday provided to hoteliers beginning in 2010 expires at the end of December 2015, along with other tax incentives for guesthouses, homestays/farmstays, and tour operators (Dept. of Revenue and Customs, Fiscal Incentives 2010, p. 19-25). These tax holidays require that the business enterprise be operational prior to the end of December 2015 in order for the business to qualify for the tax incentives. Renewal of the tax incentives for the Tourism Sector has not yet been decided, leading to uncertainty for existing and potential tourism enterprises.
Negative List There are many potential tourist visitation areas in Eastern Bhutan that are still under a “Negative List”: visitors are not allowed. Carefully controlled entry may be an option in certain situations – benefiting both the tourist economy while maintaining exclusivity on entry.
Volatile political situation in Assam The unstable political situation in Assam makes entry to Bhutan via Samdrup Jongkhar not favorable for travelers. Issues with Indian immigration officials – who keep unreliable hours in office – causes further delays and issues for travelers looking to transit through Assam.
Centralized tourism services Tourism service centers in Bhutan are located in Thimphu. Resources which could provide guidance, skills development, or business management services in tourism are all located in the capital, and thus not easily available to eastern operators.
IV. Review of Circuit 2 Development Plan and Implementation Strategy
The Circuit 2 Development Plan, focused on the dzongkhags of Trashigang, Pema Gatshel, and Samdrup Jongkhar (TPS), was completed in May 2013.
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The report submitted for the Circuit 2 Development Plan provides a detailed analysis of the following: Socio-economic profiles of each of the three TPS dzongkhags; Destination Situational Analysis; Product Development Strategy; Tourism Marketing Framework; Organizational Framework; and a Tourism Implementation Strategy.
Each of the sections provides further details leading to the recommendations for the Implementation Plan provided in the report’s Tourism Implementation Strategy.
Because Eastern Bhutan as a whole has to date experienced very limited tourism visitation, and the entire eastern part of the country is being targeted for tourism growth and development as part of the 11th Year Plan, it is important to look at both Circuit 1 and Circuit 2 holistically, and to formulate an action and implementation plan that takes all six dzongkhags in the two circuits into consideration, ensuring that the recommendations contained for the development of tourism in each of the circuits are compatible and complement and support the overall goal of increasing tourism arrivals to Eastern Bhutan, spurring sustainable economic development that can help to address issues of poverty alleviation, income generation, participation of women and other vulnerable populations in the economy, and help to mitigate issues of rural-urban migration.
The following examination of the full Circuit 2 report provides a review of the strengths and weaknesses of the information provided and the recommendations put forward, in order to strengthen the overall plan for the development of tourism in Eastern Bhutan. The purpose of this review is to ensure that the two circuit tourism development plans for Eastern Bhutan are aligned, and that the overall plan for implementation ensures that tourism development in Eastern Bhutan proceeds based on realistic strategies and more implementable action plans for its accomplishment.
In addition to a review of the written report, field research to the three dzongkhags of Circuit 2 were conducted, and meetings with key stakeholders were held to gather
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their input and feedback on the Circuit 2 tourism development report, providing information on what has happened to date with the implementation of the plan, lessons learned as a result of embarking on its implementation, and recommendations for going forward. a. Socio-Economic Profiling of the TPS Circuit
The report presents a large amount of information about the socio-economic status of the three dzongkhags, much of it from other secondary sources and consultancy reports. While this information is helpful for understanding the individual dzongkhags, much of it is not relevant to the potential development of tourism in the region. However, one can glean details that are helpful in recommending a more practical implementation plan for the development of tourism in the region.
For example, information about agricultural activity in each of the three dzongkhags indicates that there are cash crops grown for income generation in many of the gewogs in the dzongkhags. The potential to encourage and further develop these cash crops to contribute to the tourism economy as it develops, in terms of providing farm products to tourism enterprises, as well as to tourists directly, is an area of potential value-added development for the tourism economy. As well, handicrafts items that are produced in particular areas of the circuit (for example, the report notes that Pema Gatshel produces cultural and religious items such as jalings, dungs, thonphypoe, tea, and textiles), could also be marketed to tourists, if market supply chains and systems can be reasonably established to the benefit of all parties. Potential handicraft centers that already exist might be utilized as craft centers where handicrafts from local villages, women’s groups, or other sources, could be marketed, so that those not on tourism visitation routes can still benefit from tourism, and can also be assured of more equitable and fair pricing for their work.
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For example, the Handicraft Centre of the National Women’s Association of Bhutan in Khaling, with its Handloom Development Project, is a textile school where students demonstrate different stages of textile, dying, leading to finished products. In addition to offering opportunities for visitors to learn and participate, it might also serve as a center where handicrafts from outlying villages could also be brought in and sold, to the benefit of the craftspeople, supporting small income-generation and business development that would be of particular focus and benefit to women.
Noting that as infrastructure development in the area increases, the impact on the environment is a concern, the report notes that there has been resulting environmental degradation and loss of forest cover, an increase in tseri cultivation, and resulting concerns that will need to be addressed in terms of attractiveness of the area for tourism visitation.
A great deal of the detailed information provided in this section of the report, while interesting in painting an overall picture of the dzongkhags, is not directly relevant to the development of tourism. For example, the number of livestock kept by families in each of the dzongkhags does not provide information that will assist in determining how tourism might best be encouraged, supported, and developed in the TPS region. So while a lot of information is included in this section, much of it is of limited value to tourism development planning, making it more difficult to then come up with an implementation plan that will address the salient issues having to do with the development of tourism, and to identify potential areas for strengthening and participation. b. Destination Situational Analysis
This section provides a lot of detailed information and much of it is helpful in terms of understanding the current situation and making recommendations on how to move forward to develop tourism in the area.
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The detailed reviews of the difficulties in the three dzongkhags in regards to available transportation and accessibility services (lack of reliable air service, difficult conditions of roads, security concerns) are in accord with the findings of the Circuit 1 field assessment, and strengthen and support the need for improved transportation access to Eastern Bhutan if tourism visitation is to realistically increase, particularly for international visitors. The report also notes the lack of accommodation in Circuit 2 and the need for accommodation improvements, but there is no specific information provided on homestays/farmstays, and their role in the development of tourism in the Circuit. This is a serious weakness of this section, given that homestays/farm stays will be an important factor in growing accommodation availability, particularly in the short term.
The report notes that there are currently very few tourist attractions in the three dzongkhags, apart from the Merak-Sakteng Trek that was developed in 2009 as a community-based tourism product. The author notes that the trek has not been as successful as hoped, and that the number of visitors doing the trek has actually decreased after initial interest. Most visitors currently coming to TPS come as day visitors and do not stay. The reasons for this – the lack of incentive for tour operators to bring them to the area, the lack of infrastructure, and the lack of tourism products, are all noted – similar issues are confirmed in the findings of this report for Circuit 1, as well.
The report notes that another weakness in the TPS circuit is the lack of skilled hospitality workers. This is a finding that is also noted in Circuit 1. The report emphasizes the need for capacity-building in the circuit, and recommends that the Human Resources Development master plan under development by TCB include a framework for trainings in Circuit 2. This is an important recommendation that should be incorporated across Eastern Bhutan, and a recommendation for capacity- building trainings in hospitality and other aspects of tourism will form one of the important Implementation Items to move tourism development forward in Eastern Bhutan. As well, this is an area where gender mainstreaming and providing
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opportunities for rural women to participate can be prioritized, an issue that was not addressed in the Circuit 2 report.
One of the critical aspects missing from the destination situational analysis is the issue of tourism marketing, and the extremely important role that it plays in any tourism development strategy. There is no information provided about how any of the attractions currently available in the TPS circuit are currently marketed, or if they are at all.
In developing any tourism destination, understanding both the potential market – who the visitors are and can be – and how to successfully entice those visitors to visit the destination are important. Indeed, tourism development in many of the more remote areas of Bhutan has, to date, followed an approach of simply developing tourism facilities, products, and infrastructure, particularly in regards to community-based tourism efforts, only to be profoundly disappointed when visitors did not arrive, and the hoped-for economic improvements did not materialize. While noting that the only significant tourism development in the area, the Merak-Sakteng Trek, has not performed as hoped, there is no analysis of current marketing efforts and why that marketing is not working. In any tourism development plan, all components of the tourism system must be examined, and must be part of any strategy. “If you build it, they will come” does not apply in tourism, without the added component of letting people know that you have built it, and even more importantly, why they should come. c. Product Development Strategy While the SWOT analysis for Circuit 2 touches on many of the same issues mentioned in the previous section, the TPS vision rightly identifies several potential positive attributes for developing tourism in Eastern Bhutan – the potential to develop tourism in this area of the country that would lengthen Bhutan’s tourism season, increasing and extending visitation into the winter months, which currently experience little visitation. The report also identifies several areas of focus for
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tourism development in Eastern Bhutan - rural, off the beaten track ecotourism, adventure travel, and a focus on arts heritage. These are consistent with the findings of the Circuit 1 assessment, and provide for areas of alignment across the six dzongkhags of Eastern Bhutan.
The list of key tourism products, while noting the need for “new product development and expansion or improvement of the existing product offering,” is too broad-based, and does not clearly identify how to move step-by-step to utilize and build on currently existing products to create short-term tourism appeal that can slowly build, develop, expand, and strengthen. The recommendations for developing new products, using the existing NRED ecotourism guidelines, and encouraging private sector involvement, do not clearly indicate how to begin the strategic process of building a tourism economy from the existing state of affairs in Eastern Bhutan forward.
The promotion of the Merak-Sakteng Trek as the main tourism product in Circuit 2 is too limited, beyond a small number of visitors who are particularly interested in trekking, and willing to also remain in the area of an extended period of time. This is not consistent with the pattern of visitation that Bhutan currently experiences, and focusing only on this product will limit the potential for the development of tourism in Circuit 2. While it can, and should, be included as one product among other selected products to build on, it should not be the only focus of tourism promotion in the area.
Many of the tourism products listed in this section of the report appeal to a narrow segment of tourists, and require a significant amount of investment in order to bring them up to standard as potential tourism products. While the detailed analysis of the products can be useful as tourism development moves forward, most of the products suggested in the Circuit 2 report will need to be developed over the longer-term, with slow tourism growth as a result. The Circuit 1 team has concluded that the focus for the present needs to be on utilizing what is readily available, creating potential
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itineraries for visitors, targeting a market for those products, and beginning to build tourism visitation from there, with other products slowly developed and added as the tourism economy grows.
Other recommendations in this section that are valuable and supported by the Circuit 1 findings as well, include: Training and capacity building needs to be provided in the dzongkhags that will enable people to develop and improve their hospitality skills as cooks, guides, in providing homestays, and in understanding and being able to implement small-business development (bookkeeping, reservations, finances, etc.). Guides need to have specific knowledge of nature and culture, how to work with guests, and how to maintain the safety and security of guests they are guiding. Quality of services provided by community service providers needs to be improved. Tour operators need incentives for bringing visitors to Eastern Bhutan. On-going dialogue is needed with communities so that that they understand the positives and negatives of tourism, are realistic about its opportunities, aware of its threats, and involved in the decision making of how to proceed with tourism development at the local level. The Circuit 2 report advocates for a system of signage and information that is consistent and uniform across tourism products.
Our review of this report also leads us to make the following recommendations in regards to Circuit 2 in particular and to the development of tourism in Eastern Bhutan as a whole:
Particular attention will need to be paid to engaging and involving rural women in access to training and mechanisms for their inclusion will also need to be incorporated into any training and capacity building offerings.
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While this report suggests that the payment of park fees should be revoked for visitors in Eastern Bhutan, park fees are an important resource for maintaining Bhutan’s natural areas and environment. Rather, we recommend reducing the daily tariff to provide incentives for visitation to Eastern Bhutan. Tourism activities that require more minimal infrastructure development - such as walks, biking, birdwatching, and hiking – should be prioritized in the initial phases of tourism development in Eastern Bhutan; more infrastructure-heavy development (more trails, trekking routes, game fishing, etc.) should come later in the tourism development process. d. Tourism Marketing Framework
The analysis of the current trends in Bhutan in terms of the source markets of international travelers, the seasonality of visitors, and the need to develop specific marketing for Eastern Bhutan all provide important observations for how to move tourism development forward in Eastern Bhutan. While the report indicates the need to develop products as a priority, there are current possibilities for existing attractions that can be offered, and with incentives, begin to grow tourism arrivals to Eastern Bhutan.
Several specific recommendations will assist in beginning the process of increasing tourism to Eastern Bhutan, building over time as infrastructure, products, and tourism arrivals improve.
Specifically, the Circuit 2 report recommends that visitors be provided with incentives to visit Eastern Bhutan through a reduction of the tariff when visiting the circuit. The report notes that Samdrup Jongkhar is currently designated a “Royalty Free Zone” for international visitors who overnight there, an incentive put in place by TCB in order to encourage increased international visitation and hotel occupancy. So the idea of providing incentives to visitors to travel to this area is already one that has been implemented on a small level in one dzongkhag.
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This report notes that the emphasis in the short term should be focused on increasing regional tourism to Eastern Bhutan, and increasing international tourists only once more infrastructure and development takes place.
In regards to marketing tools, the report identifies several important channels for marketing Eastern Bhutan, but the report does not envision expanding Bhutan’s appeal to the international market beyond the current focus on primarily 55+ aged visitors.
Our recommendations for Circuit 2, based on our Circuit 1 report, and supported by our field research in both Circuit 1 and Circuit 2 are as follows: In order for Eastern Bhutan to truly develop, and to begin to experience the benefits of tourism development, additional markets will need to be tapped and other groups of international travelers targeted. Given the well- established and comfortable tours offered in western Bhutan, the east will not be able to compete to gain these visitors for a long time, as its infrastructure will need considerable improvement to reach that level of development. But the east can and will appeal to a younger, more adventurous group of international travelers to whom the rural, less developed, more intimate homestay accommodation, and more untouched aspects of the experience will appeal. A strong marketing campaign to differentiate the region, and to appeal to a different target audience, will enable the east to begin to build its tourism economy in the shorter term, growing steadily into the medium and longer term. Rather than creating a Royalty Free Zone in Eastern Bhutan, we recommend that the tariff be eliminated, while the Royalty Fee remains in place for all tourists to Eastern Bhutan, including regional and international tourists. This will provide incentives for tourists to visit the area, while also discouraging a two-tiered treatment of different visitors, equalizing the tourism experience for both groups of tourists and decreasing the challenges posed by having two
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different types of tourists with different expectations, policies, and impacts, but utilizing and enjoying the same tourism resources. e. Organizational Framework
The report provides a great deal of detail about the roles of various sectors of Bhutan government, civil society, and the private sector to coordinate the development of tourism in Eastern Bhutan.
The information presented is complex and presents more detail than is needed to move forward with tourism development in Eastern Bhutan.
We recommend the following in regards to organizational structure for developing tourism in Eastern Bhutan:
A streamlined process for managing tourism development in Eastern Bhutan must be clearly identified and must encourage community engagement and participation, enable the local dzongkhag administrators to move forward with the needed support, and allow for strategic development and coordination. A Circuit Tourism Committee to oversee tourism development for all six dzongkhags in Eastern Bhutan should be formed and the management of that tourism development clearly coordinated. Each of the individual dzongkhags has developed their own inventory of tourism products, and has a clear sense of their tourism attractions. Many different organizations, both from the Bhutan government, and from the NGO sector, are engaged in a variety of projects in Eastern Bhutan that can and should be coordinated in terms of their contributions to the development of the tourism economy. An overall understanding of all of the development projects currently going on in the six dzongkhags would assist greatly in cross-collaboration and reduction in duplication of efforts, leading to enhanced benefits and a clearer overall vision for the development of the region.
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The structure to better organize and streamline these efforts must be carefully considered, so that moving forward is not mired in yet more bureaucracy. Input from all of the various sectors to the development of tourism in Eastern Bhutan is critical, but a process for decision-making and implementation must also move forward. A Circuit Tourism Committee may be helpful in gathering the input of many different stakeholders, and provide a mechanism for ensuring that gender issues and gender mainstreaming are included as part of the deliberations, but it will only be successful if clear lines of decision-making and authority for carrying out specific tasks are outlined and adhered to, with clear monitoring of results. The recommendation in the Circuit 2 report for creating industry excellence awards for the private sector, a program to be implemented and managed by TCB, is worthy of inclusion in any Eastern Bhutan tourism development plan. Highlighting best practice achievements, with a strong focus on sustainable tourism criteria, to include environmentally-friendly operations, support for natural and cultural heritage, and support for local communities, can help encourage and support the development of exemplary tourism enterprises, services, and facilities. f. Tourism Investment Framework
This section of the report primarily deals with public sector support for tourism development in the TPS circuit. The recommendations focus on infrastructure developments.
One of the points made is that if the government simply builds tourism infrastructure (i.e. campsites, rest facilities, etc.), then there is little incentive for the communities themselves to value or participate in the development of those tourism offerings. Instead, providing mechanisms for individuals, communities, and others to have access to financial opportunities and to participate in the decision-making about
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what and how to develop tourism, creates a more engaged and involved local population. Thus, while the government focuses on the development of overall infrastructure (such as roads), it should also create mechanisms that incentivize local people, communities, and the private sector to develop and engage in tourism. The report makes several worthwhile recommendations for tax incentives for the private sector that should be implemented in consultation with stakeholders at the local level.
However, in addition to the incentives mentioned in the Circuit 2 report, we recommend that other investment support be made available for the development of tourism, utilizing private-public partnerships, and designed in such a way as to encourage local community support and engagement in the tourism sector.
In order for tourism development to be successful in Eastern Bhutan, coordination and engagement with local stakeholders is critical, so that decision-making reflects not just what the government thinks will work, but includes and addresses what those at the local level think will be most valuable as they embark on the process of tourism development.
We recommend that TCB consider mechanisms to facilitate community engagement in the process of tourism development, which might include providing a portion of tourism revenue to specifically support local-level initiatives, decided at the local level, to improve the overall aspects of communities to make them attractive to visitors, while also improving local conditions for the villagers themselves. For example, a portion of tourism proceeds reverting back to the dzongkhags could be utilized for village and local beautification projects, developing better waste management and trash collection facilities, cleaning up village centers, and restoring areas degraded by construction. Local decision-making in determining these priorities will also contribute to local engagement, as well as to local responsibility and value.
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g. Tourism Implementation Strategy
While many good ideas are presented in the overall recommendations for the development of tourism in the TPS circuit, there is need to further prioritize and develop specific action steps that can be achieved, particularly in the short term.
We recommend that both circuits in Eastern Bhutan be combined into one overall circuit, and that existing tourism infrastructure and attractions form the basis of a specific and targeted marketing campaign for Eastern Bhutan that will begin to increase tourist arrivals. Without tourists arriving in increasing numbers, tourism will continue to be an idea that does not deliver on its potential, and locals will continue to be disappointed by its impact. However, building realistically from the existing assets that the east has to offer, targeting an international market that will value and relish this, and building on this success will be the best way to incorporate tourism as a strategy to contribute to the sustainable development of the east. h. Local Stakeholders Response to the Circuit 2 Report
In order to gather an up-to-date view of the circuit tourism development plan for Circuit 2, completed in 2013, and to gain an understanding of its implementation to date, its strengths and weaknesses, and to take the opportunity to refine the approach, field research and meetings with local stakeholders in Circuit 2 were conducted in June 2015 to gather additional insights.
Several important findings resulted from the meetings with Circuit 2 stakeholders, which will be important to address if tourism development is to move ahead in Eastern Bhutan. Among these findings:
Many stakeholders were not aware of the report, or the development of the Circuit 2 plan.
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There was not effective stakeholder engagement in the development of the Circuit 2 plan, both at the national and local levels. As recommended in the report, a Destination Steward Circuit Tourism Officer was funded and stationed at Trashigang for three years, with the position ending in June 2015. Funding for the position was provided by TCB through UNIDO. Stakeholders were not aware of the presence of this person, and no consultations or introductions were provided. The Tourism Officer himself did not fully understand his role for the position, and was unable to implement any aspects of the Circuit 2 tourism development plan, due to a lack of understanding of his role, a lack of consultation and engagement at the local level, and a lack of support at both the national and local levels. Local government officials expressed concern that local people need to be first made aware of tourism in all of its aspects, in order to gain an understanding of the tourism sector and knowledge to participate in its proper development. Because of the lack of consultation on the plan, local ownership of the results has not happened, and implementation of the recommendations and actions in the Circuit 2 report have not been implemented.
Each of the dzongkhag administrators in Circuit 2 made specific recommendations in regards to tourism development from their perspective in their respective areas:
Trashigang: Product development should be prioritized based on the tourism market – while it is good to promote trekking routes, more focus needs to be paid to day or overnight attractions. Develop and print an information booklet (like the one produced by Mongar Dzongkhag), with information and pictures. Develop the history museum, as proposed in the report, but do it at Chazam (Trashigang bridge at river below Dzong) by converting the existing lhakhag (temple).
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Pema Gathshel: The Government should provide initial investment to build a guesthouse that meets tourist accommodation standards - the current low volume of visitors does not encourage private investors, so the government needs to kick start the investment. Capacity building training, especially for food service providers. Develop and print an information booklet, with information and pictures.
Samdrup Jongkhar: The Government should construct a regional tourism office cum information center, staffed with tourism officials. Remove Samdrup Jongkhar from negative listing, allowing tourist visitation. Allow Indian tourists to visit as far as Deothang without permits for day visits. i. Strengths and Weaknesses of the Circuit 2 Tourism Development Plan
STRENGTHS WEAKNESSES
Information and data collected captures Socio-economic information provided is too many of the attractions in each of the detailed, and is not relevant to tourism dzongkhags of Circuit 2. development Handicrafts, cultural and religious items are Lack of attention to the potential produced in particular areas of Circuit 2, development of homestays/farmstays in the which could be further developed as Circuit 2 dzongkhags income-generating activities. Focus on trekking for product development Existing handicraft centers can be further – focus is too narrow to actually increase expanded to encourage access for women tourist arrivals in any significant numbers removed from tourism visitation, providing Product development offerings are too opportunities for increased sales at fair numerous and not focused on developing prices. short-term excursions to enhance overnight Author does a good job of identifying tourist visitation. challenges to tourism development in Circuit Report focuses on expanding numbers of 2, including: lack of reliable air service, regional tourists, but does not address difficult road conditions, security concerns, expanding the market of international lack of accommodation, lack of skilled tourists to reach younger and more dynamic hospitality workers. age-groups who would be interested in Report recommends training and capacity more adventurous tourism offerings in building for hospitality workers, including Eastern Bhutan. food service providers, homestay providers, Recommends that payment of park fees for guides, and other tourism sector workers. visitors to Eastern Bhutan be revoked – this Report identifies the need for building will be detrimental to the protection of capacity of local communities to realistically Bhutan’s parks and protected areas. understand tourism, its opportunities, its Recommends a Royalty Free Zone for threats and how to build a sustainable and Eastern Bhutan – eliminating the tariff and realistic tourism economy in Circuit 2. keeping the royalty will provide a stronger Recommends providing incentives to incentive for tourists to travel to Eastern tourists to visit Eastern Bhutan. Bhutan.
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Recommends the creation of industry Report does not address issues of gender excellence awards to encourage and and other vulnerable populations in terms of highlight best practice achievements in the participation in any tourism development in tourism sector. Eastern Bhutan. Identifies the need for community After the report was finalized, it was never involvement and engagement in tourism shared with the people/agencies that were development – if all tourism development is consulted. carried out by the government, there is no The assignment of a Destination Tourism community buy and no investment in Officer to Trashigang for three years was tourism being successful in the region. not known to any of the stakeholders in Circuit 2. The study for the six eastern dzongkhags should have been done together instead of breaking it into two circuits. Support from TCB in taking forward the recommendations has been weak - there has been no coordinated implementation of the plan at the national or local levels.
V. Strategy: Recommendation for Tourism Development and Implementation Plan for Eastern Circuit I a. Overview
The strategy laid out in the following section is based on the analysis presented in previous sections of this report; it provides a series of recommendations for Bhutan as it seeks to develop a sustainable tourism economy in its eastern region (Circuits 1 and 2), increase tourism sector revenue, and continue to attract “high value, low impact” tourists. The strategy takes into consideration the multitude of ongoing challenges that have prevented sustained regional development up to this point in time. The specific challenges that this report has laid out in previous sections, and that the report seeks to address in its strategy include: Difficult overland access and lack of air transit; Condition of accommodations: lack of 3-star “tourist hotels” and extremely low quality of home and farm stays; Level of training of tour industry professionals and hospitality workers; Contextual differentiation of eastern versus western Bhutan; Lack of consistent, overarching vision for how the region should develop;
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The lack of the east’s appeal to Bhutan’s current priority international market: 55+ year old tourists not looking for rugged adventure; Lack of incentives to operate in the east; Over-valuation of the current eastern experience given required daily spend; Condition of villages – residue, rubble, and lack of measures made to beautify sites that could be marketed as tourist attractions; Other barriers to entry, including lack of investment opportunities and investment incentives, as well as access to financial resources.
The goal of this strategy is to provide a series of action items, with a time line (and tentative schedule) for implementation. It is insufficient to expect that the tourism economy in the east will improve if simply left alone; as noted throughout this report, the barriers to a successful tourism economy in the region are deeply ingrained. Furthermore, the goal is not simply to alleviate certain barriers, but rather enact changes that will orient the region towards long term growth. Bolstering infrastructure, providing access to proper tourism/hospitality training, and improving access to the region are measures that can help set the direction for using tourism as means of economic growth, poverty alleviation, and revenue generation. With the proper infrastructure and human capital in place to manage the region’s economic vision, a decrease is possible in Bhutan’s rural-urban migration – cited as a major issue that contributes to the lack of opportunity and sustains rural poverty.
While this strategy recommends changes to policy and infrastructure inside Bhutan, it is also concerned with better positioning Bhutan within the international community. Bhutan currently occupies a niche in the global tourism market. It is viewed primarily as a cultural destination; festivals and dzong visits are among the most popular and prevalent tourist activities. The country is also viewed as an expensive destination, given that it upholds a US$250 minimum daily spend and does not allow tourists to travel free of a contracted guide. Thus, Bhutan currently attracts a small segment of the global tourist market – those who are both interested in a cultural experience and can also afford the high minimum spend. While Bhutan
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has long sought to use the tariff to deter low-value tourists who can damage a country’s tourism image, in today’s global travel market, there is a very wide gap between the low-quality, extremely low-budget travelers Bhutan seeks to avoid, and tourists who are willing to spend US$250 a day just to be in country. In upholding this unique policy, Bhutan has not benefitted from a large segment of the global market that would be interested in both the cultural tourism that Bhutan is currently known for, as well as lesser known attractions and experiences that can be successfully marketed in its other regions. It is the goal of this strategy to reposition Bhutan’s east as a destination different from what is currently considered the Bhutanese tourism experience – a tourism experience that for all intents and purposes is based on what is available in the western and central parts of the country. Differentiating the east from the west is crucial to the eastern region being recognized by the international tourism community as a destination in its own right. A rebranding of the Circuit 1 and 2 provinces as Bhutan’s “Wild East” is suggested in this strategy.
Embracing a wider demographic of travelers through unique positioning and global marketing efforts also comprises a core aspect of the strategy. Bhutan’s current market has appealed primarily to 55+ year old international tourists. While these tourists comprise a valuable – albeit small – subset of the total global market, Bhutan is not seeing visitation from a much larger and also lucrative market: travelers aged 25-55. We segment this cohort into two chief demographics, which bear some overlap: Millennials (~ages 25-40) and Adventure Travelers (~30-55). Millennials, who will reach their prime working, earning, and spending years over the coming decade, are a strong match for Bhutan’s eastern offerings. In addition to being interested in adventure travel and intensive, culturally authentic experiences, they are savvy travelers who desire to explore some of the last frontiers of the planet. Bhutan’s eastern region can be marketed towards this group and garner significant interest. Adventure travelers comprise a larger demographic, based more around interest in nature-based adventure activities and lifestyle than specific age. Adventure travel continues to be one of the fast growing subsets of the tourism
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industry. As Bhutan is primarily seen as cultural destination – its main attractions being dzongs and festivals of the west – the east is primed to cultivate the different identity of a rugged, activity-based, adventure travel destination. With unique terrain and landscape, the Buddhist kingdom’s “Wild East” could host a multitude of adventure-based activities – hiking, mountain climbing, kayaking, and walking, to name a few. Bhutan can also bolster its cultural tourism in the east by honing in on the rich tradition of Buddhist art and history so integral to the region. Having guides who are trained to provide travelers with in depth knowledge of the method, medium, and significance of Buddhist art is a marketable niche travel experience that has gained ground in cultural destinations across the world. It offers those who are interested a chance to take a deeper dive in the east into the Buddhist artistic and monastic traditions.
Accessibility to the eastern region is still a major obstacle to simply getting more travelers into the region. Difficulty in traveling the lengthy, winding overland route is compounded by the fact that road construction is rampant, further delaying travelers. For both reasons, the strategy will focus on bringing tourists into the region via flight from Paro, and eventually, directly from Guwahati or Bangkok if the demand is high.
While some recommendations warrant additional discussion and research between TCB and other stakeholders – such as creating a mobile regional training program and a standardized evaluation system for monitoring the standard of lodging – the recommendations outlined in the proceeding section are objectives that Bhutan should consider pursuing in order to achieve its goals of driving tourism economic growth to the region. b. Infrastructure and Institutional Development
Institutional Capacity TCB’s objective for the six dzongkhags of Eastern Bhutan is for tourism planning and management to be at the circuit level and governed by a Circuit Tourism
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Committee (CTC), an executive body comprised of public and private member representatives from the dzongkhags. The two circuits of Eastern Bhutan should be joined, and one CTC should manage tourism development for the entire region, with decentralized participatory tourism planning and development helping to create more opportunities for local communities.
A Tourism Officer should be identified and assigned in each of the six dzongkhags, responsible for interfacing with TCB and participating at the regional level to monitor and support tourism development efforts in the dzongkhag, as well as coordinate with the other dzonkhags of Eastern Bhutan to implement the overall circuit tourism development plan. Each dzongkhag Tourism Officer should participate in the CTC.
Providing a clear outline of responsibilities for the Tourism Officer will be important to the success of the development plan, and careful monitoring and evaluation of progress will also be critical to moving the process forward. Attention should also be paid to ensuring that the Tourism Officer is working with dzonghag officers and other important regional stakeholders.
In addition to the assigned Tourism Officer in each dzongkhag, other stakeholders should be carefully identified to participate in the CTC, with attention paid to encouraging and enabling the participation of women and youth, so that all important community voices are included in the tourism development planning and implementation process. If the CTC is to be successful in enabling tourism development in the east, clear lines of decision-making and authority for carrying out specific tasks of the Circuit Tourism Development Plan must be outlined and adhered to, with clear monitoring of results.
Infrastructure Development: Transit to the East Given the fact that the ongoing construction of the highways to the eastern provinces poses significant obstacle to tourists transiting to the east, it is recommended that Bhutan’s air carriers – Drukair and Tashi Air – begin providing regular flights to the
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airports at Bumthang and Yongphula from Paro. TCB, Drukair and Tashi Air, and other stakeholders in Bhutan should team up to create itineraries that enable travelers to fly to and from the east (or fly one way and travel overland one way). While the frequency of these flights may be limited initially until there is a substantial increase in demand, Bhutan’s air carriers should coordinate departures to the east with international arrivals and departures in Paro. Thus, an arriving tourist has the opportunity to fly in – say from Bangkok – land in Paro, and transit directly to the eastern circuit where s/he can begin their tourism experience. While it is up to Bhutan’s air carriers, TCB, and tourism stakeholders to coordinate exactly how to manage flights to and from these eastern airports, one suggestion is for Drukair to use its smaller aircraft – such as its ATR 42-500 – which runs from Kathmandu to Bhutan. It is important that flights are available to tourists who wish to fly out to these airports, and that transit via air should be marketed as the preferable option for tourists by tour operators.
Although the road construction may eventually come to a close, the roads – even in improved form – still constitute a major obstacle and challenge for tourists looking to visit the east. The roads are lengthy, extremely winding, and necessitate 2-3 days of overland travel. The goal is to provide consistent and bookable air transit to the east to enable greater ease of access for all tourists – enabling more tourists to visit the east for whatever length of time they choose. Circumventing the difficult roads – whether construction is going on or not – allows the eastern provinces to become an attainable destination within Bhutan, opening up the region to greater tourism potential.
Home/Farmstays The quality of Bhutan’s current homestays and farmstays is not at an adequate standard to host international tourists. While there are a few home/farmstays which provide a basic level of accommodation, the majority of those officially sanctioned and registered by TCB are not at a sufficient quality standard. Home/farmstays, while widely acknowledged to provide a lower standard of accommodation than
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starred or ranked hotels and guesthouses, still need to provide basic amenities to international travelers: hot water, clean towels and bed linens, a shower and a proper bathroom. In order to bring Bhutan’s home/farmstays up to a consistent standard, TCB needs to inspect all home/farmstays. Home/farmstays that are looking to be nationally sanctioned need to be vetted for quality, and it is recommended that TCB develop a manual (or further refine the existing Phobjikha homestay manual used by the Royal Society for the Conservation of Nature) and service checklist which can be given to hosts and which outlines the requirements for hosting foreign guests.
A change in the understanding of what a homestay should be is also needed - a homestay is not simply a room to let. Rather, a homestay – in the global travel market – provides a deep, culturally authentic experience to guests. Guests should have the opportunity to learn about daily life, share stories with their hosts, learn traditional cooking or take part in daily routine. The homestay host should provide the guest with an orientation and introduction them to the local community. In short, home/farmstays in Bhutan must not only adhere to a set standard of accommodation, but each homestay must be able to provide an informed, culturally enlightening, engaging experience. To ensure the success and development of Bhutan’s eastern homestay program, quality controls need to be instituted and investment in both human capital and accommodation standard is warranted. c. Marketing Plan and Core Demographic Bhutan’s “Wild East” Position the eastern region – comprised of the dzongkhags in Circuits 1 and 2 – as Bhutan’s “Wild East”. This new identity differentiates the eastern region as a unique destination within the kingdom of Bhutan. This new identity and branded tagline highlights the region as one of the “last frontiers” on earth – where rugged adventure and expedition are the cornerstones of the travel experience. The rebranded eastern region will reflect the following defining characteristics: Virgin wilderness, unique terrain, remarkable flora;
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Travel experiences geared towards the active, adventurous market; Rugged, authentic experiences in which one has the opportunity to really engage with traditional Bhutanese life; The region’s remoteness and inaccessibility become selling points that underscore the region’s remote and pristine beauty; Accommodation in the region is primarily rural home and farmstays; Sense of expedition and adventure travel.
It is important that Bhutan adopt a unique identity for this region and segment the experience offered from that in the rest of the country for two principal reasons: To guide development in the region, and ensure that marketing, infrastructure, and human capital development fit the goal of characterizing the region to the international market as one of rugged expedition and experiential adventure travel; Adopting a brand identity allows travelers to view the region in a new light – where it is part of Bhutan but also offers something different than what one can get in the west.
While it is likely that there will be at least some overlap in visitation, travelers seeking adventure, nature based activities, and a more rugged experience may gravitate to the east, while those looking for the typical cultural experience may stay primarily in the west. The goal, once again, is not to simply transplant tourists from the west to the east – it is to attract more (and different) tourists to the eastern region so that Bhutan’s overall visitation and tourism sector revenue increases.
There are multiple examples of countries in which different regions of a country not only maintain successful independent travel industries, but whose regions conjure a very different image (and set of expectations) than other regions of the country. Take France for instance: Paris and its environs conjures a very different set of images and travel experience expectations than Provence or the Cote D’Azur. Based on what type of experience a traveler may be interested in, what their
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interests are – urban setting, nature, or the beach – the traveler chooses which region to spend all (or most) of their time while visiting France. Chile markets luxury resorts, food and wine, and colonial cities to older travelers, while it markets rugged adventure offerings to adventure travelers in Patagonia, branding each separately. As well, Thailand markets the north of the country to younger travelers seeking jungle trekking, homestays, and cultural experiences with the hill tribes, while southern Thailand brands itself with sun and sea beach resort opportunities. A similar situation is possible for Bhutan, in which the travelers more interested in adventure based activities, home and farmstays, and wilderness would choose to travel primarily in Eastern Bhutan over the west. There is currently no differentiation on the global market between Bhutan and Eastern Bhutan. The first step to getting tourists interested in traveling to the region is by differentiating the experience, and denoting the region as a truly unique destination in the travel world.
Target the Adventure Travel Market As Bhutan develops a core identity for its underdeveloped eastern region, adventure travel – a booming subset of the global travel market – should become the cornerstone of the eastern experience. Adventure travelers – which we define as individuals who travel with the purpose of active participation with the natural environment, often involving physically demanding experiences – would be interested in Bhutan’s “Wild East”. Adventure travelers comprise a generally younger demographic in the travel market than the 55+ year old tourists who currently make up the bulk of Bhutan’s international tourists. These individuals are drawn to regions that can successfully offer rugged experiences, nature based treks, and adventure activities. As Bhutan seeks to develop attractions in the east to bolster its tourism economy, much attention must be paid to these individuals and the types of activities they enjoy (and are willing to spend money on). Suggested activities are kayaking, hiking, mountain biking, rock climbing, and rafting, among others.
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Target the Millennial Travel Market These individuals are poised to become a tour de force in the global travel market. They are a younger subset – generally acknowledged to be individuals born between 1980 and 2000 – but they comprise a significant and growing portion of the travel market. They exhibit different tastes in travel than older generations, but are generally more interested in culturally authentic, unique experiences that offer a true look into a destination’s way of life. With successful, targeted marketing, they would be interested in the eastern region of Bhutan. They lack the capital of the 55+ traveler, so a US$250 per day spend is a disincentive to visit Bhutan. But they are willing and interested in investing in valuable and accessible travel experiences. They are not looking for “cheap” travel experiences, but for rich, rewarding experiences in unusual destinations. Were the tariff lowered, and the region successfully marketed, they have immense potential to bring needed revenue to the region, while simultaneously contending with the lower standards of accommodation and infrastructure that currently prevail in the region. As they are younger, they have a high return potential to countries that offer a unique and unforgettable experience. Bhutan should seek to orient the region to this large cohort, who will reach their prime working, earning, and spending years over the coming decade. d. Training and Capacity Building To bolster Bhutan’s tourism workforce in order to handle its goals of increased international visitation, Bhutan must develop its human capital in the tourist and hospitality industries. The current level of staff training in the east – at any level of accommodation, from starred hotels to home and farmstays, is not at a sufficient standard to host international tourists, especially those currently paying the US$250/US$200 daily tariff. Guide training in the east also represents a serious opportunity for further development, particularly as Eastern Bhutan seeks to focus on in-depth nature and adventure travel, with the potential to also develop spiritual and art history tourism.
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Hospitality Training In order to contend with the need for intensive training, it is recommended that Bhutan set up a regional hospitality and tourism training program, requiring that all hospitality workers register and take part in training to some degree. Given the geographic spread and diversity of the region, we propose that trainings be offered through a mobile training center that has the ability to work from both regional urban centers as well as small villages. The trainings provided can be tailored to the individual area, but should provide consistent messages on skills needed to work with international tourists. TCB should initiate coordinated efforts to design and direct a variety of training curriculums, including utilizing local, regional and international assistance and support. Short-courses that are easily accessible, appropriate, and tailored to the literacy and other needs of potential tourism workers who seek to build their own capacity in a series of steps, and that can be easily implemented, can be instrumental in building the capacity for tourism development in rural areas. As an example, the small country of Belize in Central America has implemented a series of flexible courses offered in multiple-locations throughout the country at different times and depending on level of interest to help build its local tourism capacity. The training program may choose to focus on the following areas, among others: Hospitality training: Expectations of international travelers vis a vis varying levels in accommodation; capacity building to interact with international guests; codes of conduct. Food preparation and hygiene skills: Cooking and menu planning, food safety and hygiene, presenting cultural explanations for foods, dealing with dietary restrictions of international guests, etc. Basic English language skills for hosting travelers: Interacting with international guests when language is a challenge and building other skills for enhanced communication. Basic first aid and understanding of safety and security for guests. Small business development: How to develop income-generating products and activities, such as handicrafts, cash crops, etc.
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Guide and Activities Training Bolstering the capacity of trained tour guides, especially in the east, is important for enhancing the quality of the overall tourist experience. If the region is to be marketed as providing in depth nature and cultural treks (including adventure travel activities and Buddhist art and spiritual tourism) then guides who are responsible for these activities must receive the in depth training they need to offer tourists a remarkable experience. While guide training goes under the umbrella of broader hospitality and service training, TCB must have a means – by examination, licensing, and consistent checks ups – of ensuring that guides who take travelers out are certified to lead. A mobile guide training and certification program focusing on the following areas is recommended: Training on how to guide/how to lead a tour group: the art of tour guiding; Specific training based around activity: nature for nature treks; Buddhist art for monastic tours; kayaking, etc.; Basic English language skills for guiding travelers; Basic first aid and understanding of safety and security for guests.
Guide training should include both basic skills, for those new to the tour guide field, as well as further training courses offered to build capacity and enhance particular skills and knowledge, such as bird-watching, art or religious history, adventure activities such as mountain biking, etc.
In addition to providing training and capacity building across the tourism industry in Eastern Bhutan, TCB should implement an awards program that recognizes tourism excellence in the private sector, across multiple sectors of the industry. Highlighting best-practice achievements, with a strong focus on sustainable tourism, including environmentally-friendly operations, protection of natural and cultural heritage, and support for local communities, can help encourage and support the development of exemplary tourism enterprises, services, and facilities. National tourism awards are used in many countries to recognize and reward tourism excellence, and to
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strengthen and encourage the steady improvement of the industry; these measures would be equally valuable in Bhutan as the country seeks to improve its tourism offerings and promote best-practices in Eastern Bhutan.
Beautification Many sites in the eastern region, including small villages such as the weaving village of Khoma, need to be beautified in order to improve the aesthetic of traveling to these locations. Better and more consistent waste management – including consistent removal of trash residue, construction rubble, and animal waste – is important to not only attracting more tourists, but ensuring that the standard of the tourist visit is at a higher level. While Trashiyangtse, for instance, frequently receives commendation as the cleanest town in Bhutan, removal of construction waste and rubbish is still an opportunity for this town. A more consistent waste removal system and baseline beautifications of the villages, towns, and areas that the country seeks to market to international tourists, need to be implemented, with coordination at the dzongkhag and local levels and in consultation with TCB and other tourism stakeholders. e. Liberalizing the Tariff Policy Currently, the minimum daily tariff is US$250 per international tourist per day during high season (March, April, May, September, October and November), and US$200 during low season (June, July, August, December, January and February). Included in this tariff is an RGoB “royalty fee” of US$65 per international tourist per day during high season and US$55 per international tourist per day during low season. This current Tariff and Royalty fee policy has prevented Bhutan from capturing the fast growing middle market tourist demographic, ages 25-55. While the US$250 per person per day may be more affordable for the 55+ year travel demographic, the US$250/day tariff/royalty fee is out of economic reach for the majority of today’s middle market travelers, of which adventure and millennial travelers comprise the bulk of the market. A reduced or full elimination of the tariff (but not the royalty fee) will be a powerful incentive for tourists who previously could not afford the high daily
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spend to visit Eastern Bhutan. Furthermore, a reduced or eliminated tariff also better reflects current standards and infrastructure, accommodations, and quality of experiences in the east, correctly positioning it as a more affordable option for travelers who still wish to visit Bhutan, but are not interested in the 3+ star luxury available in the east. Upcharges for different levels of accommodation in the east are still viable; however, given the industry standard in the region, a lower minimum daily spend is recommended. Three scenarios are laid out below that describe implications for removing, reducing, or keeping the daily tariff in the eastern region.
Scenario 1: Remove Tariff / Keep Royalty Fee in Eastern Bhutan Bhutan has steadfastly adopted and promoted a national “high value, low impact” tourism policy. This policy has been important in guiding the country during its years as an emerging tourism destination. As Bhutan has marketed itself as an ancient Himalayan Buddhist Kingdom, it vehemently sought to avoid any potential damages from tourism to its pristine image. As a relative latecomer to open its doors to global tourism, Bhutan saw the damage that unregulated and unguided tourism could bring to cultural and national image. By setting a high minimum spend, Bhutan closed to the door to everyone save those who could afford to pay the hefty entrance fee. While this policy has been successful to a certain extent in helping safeguard Bhutan’s image from potential risks of free enterprise tourism, it has also resulted in extremely uneven tourism development in the country, poor distribution of tourism economic benefits, and has helped prevent a natural tourism economy from developing in the eastern region. The existing tourism tariff policy has also prevented Bhutan from capturing one of the largest and fastest growing sectors of global tourism – travelers aged 25-55 – who have been priced out of traveling to Bhutan due to the US$200-US$250 per person per day requirement. By eliminating the tariff for travel to Eastern Bhutan while keeping the royalty fee of US$65/Day for all tourists, both international and regional, Bhutan immediately creates a strong incentive for increasing tourist visitation to the eastern region. All tourists (international and regional) would have to be packaged through a licensed Bhutan tour operator and the royalty fee will continue to benefit Bhutan. Elimination of the
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tariff while keeping the daily royalty fee also provides a safeguard against the low- value, extremely low budget tourists that Bhutan seeks to avoid – as these “backpackers” often seek daily subsistence (accommodation, food, transport) of US$25 or less. In removing the tariff but keeping the royalty fee for all tourists – and in coordination with other measures mentioned in this strategy – Bhutan has the potential to rapidly increase visitation to the east, improve economic distribution, and increase tourism sector revenues for the country.
Scenario 2: Reduce Tariff / Keep Royalty Fee in Eastern Bhutan An alternative to completely removing the tariff for travel to eastern Bhutan is to reduce the daily tariff to US$85 per person per day. Combined with the $65/day Royalty, the per-day required spend would be $150 per person per-day. While this policy would not have the same powerful impact and incentive for increasing tourist visitation, it would still open eastern Bhutan to a larger travel market – primarily, adventure travelers 35-55 years old who could contend with this tariff level, but not the current US$200+ tariff level. This scenario would allow Bhutan to continue to uphold the tariff policy – thus still pricing out a large cohort of lower budget travelers – but would still incentivize the east as a more affordable travel destination within Bhutan.
Scenario 3: Tariff/Royalty Stay the Same The current Tariff/Royalty policy of US$250 and US$200 per person per day is a significant obstacle to increasing international tourist arrivals in eastern Bhutan. Why would an international tourist pay the same price of US$250/day to travel to the east where conditions are rugged, basic infrastructure is lacking, and service standards are at a significantly lower quality than in the west? If the current tariff policy was working well for the east, then international tourists would have already been gravitating to eastern Bhutan in the same way that they actively prioritize and seek the attractions of Punakha, Paro, Thimphu and Phobjikha. Yet this has not happened. In fact, as the western region’s tourist economy grows, more human capital (and resources) are pulled from the east, further driving down the standard
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and aggravating rural poverty. As it currently stands, the US$250 minimum spend not only constitutes a significant challenge for the east, but it is in fact directly harming tourism growth in the region. If Bhutan wants to keep a US$250 per-day minimum spend throughout the whole country, then serious capital investment is needed in the short term to bring the quality standards of the east – accommodations, guide services, roads, restaurants, and other tourism sector businesses – to a level that warrants as high a daily spend as in the west. This high- investment approach is not only cumbersome and costly, but it bears no promise of increasing visitation, especially in the short-term. Eliminating the tariff or, at the very least, reducing it, as in scenarios 1 and 2 above, can increase international tourism visitation to eastern Bhutan in the short-term and continue to foster growth in the long-term.
The Thai Tariff Experiment In 2014, as a gesture of good will between royal families and to recognize 25 years of diplomatic relations, Bhutan agreed to waive the daily tariff and only keep the US$65 per-day royalty for a period of 3 months during the low season. This change in policy quickly boosted Thai tourism numbers in Bhutan, and benefited a wide range of tourism stakeholders including airlines, hotels, guides, restaurants, handicraft shops, taxis, and tour operators. Increased Thai visitation also did not devalue the Bhutanese travel brand. The experiment with reducing the Thai Tariff underscores the potential benefits that can come by waiving the minimum spend and keeping the per-day royalty – the strategy outlined in Scenario 1. Removing the daily tariff provided a means for quickly increasing visitation – a boon for the tourism industry – while maintaining the royalty fee continues to build funds for Bhutan’s internal needs.
The Chinese Tourist Market The Chinese tourism market is growing at a rapid rate – especially as the Chinese middle class continues to expand. While there is an appeal to trying to capture this growing market, the Chinese market presents significant concerns as well. Chinese
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tourists book shorter tour packages than other international tourists. More than 50% of Chinese tourists visiting Bhutan spent 4-5 nights, and fewer than 5% stayed 10 days or longer (BTM 2014, p. 12). In contrast, more than 40% of Americans stayed more than 7 nights, as did 48% of British tourists, and 65% of Germans (BTM 2014, p. 12). Chinese guests focus on short duration trips and heavy sightseeing – often trying to pack in as much sightseeing as possible in a short period of time. Furthermore, Chinese tourists tend to book large groups and prefer to travel en masse. There are growing reports over problems with Chinese tourists not understanding cultural sensitivities, or being unwilling to contend with travel services that do not cater specifically to Chinese tourists. While the Chinese market is important to Bhutan, the above factors need to be taken into consideration. Furthermore, the interests and focus of Chinese tourists are oriented more to the tourism attractions and facilities available in the western circuit, and they are unlikely to be a market for the more adventurous and less-developed tourism opportunities available in eastern Bhutan.
Regional Tourists Regional tourists – tourists from India, Bangladesh and the Maldives – can travel in Bhutan without having to obtain a visa, without a licensed tour guide, and without having to pay any minimum tariff or royalty fee. A few notable attributes of regional tourists follow: The majority of regional tourists stay 3-4 nights in Bhutan; The majority of regional tourists spend between US$156 and US$312 for their entire trip, a dramatically lower per person revenue than that generated by international tourists in Bhutan; In 2014, regional tourists represented almost 50% of all tourist arrivals in country: 57,934 international tourist arrivals and 48,544 regional tourist arrivals. (BTM 2014) Regional tourists, while comprising a very large portion of annual visitation, provide significantly lower revenues to Bhutan than international tourists. They provide little economic benefit to Bhutan’s tourism industry, despite their high numbers. Without
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the requirement of any minimum spend, and without being required to register with a licensed tour operator and travel with a guide, regional tourists are in conflict with Bhutan’s “high value, low impact” policy. The fact that these regional tourists are not required to travel with a guide means that there is little oversight on the impact they have on valuable Bhutanese attractions – including temples, Dzongs, and national parks. By upholding this policy of no tariff and no royalty fee for regional tourists, Bhutan runs the risk of attracting large numbers of high impact, low value tourists.
Bhutan’s two tourism policies – in which international tourists pay a high per-day tariff and royalty, and regional tourists pay neither – results in a growing number of two different types of tourists and, as noted, creates a tourism policy in conflict with itself: the policy for international tourists creates high value/low impact, while the policy for regional tourists allows high impact/low value. It is recommended that tourists – regional and international - should pay the US$65 per day royalty fee, in order to provide increased revenue for Bhutan, but to also dis-incentivize high impact/low value regional tourists who may negatively impact Bhutan’s tourism economy. The US$65 per day royalty fee upholds Bhutan’s desire to only bring in high-value/low impact tourists, and encourages only higher spending regional tourists to visit the country. f. Priority Product Development Strategy for Circuit 1 The three eastern dzongkhags – Mongar, Trashiyangtse and Lhuentse – have already established extensive inventories of their attractions. In the case of Trashiyangtse and Mongar, a comprehensive list of tourism products including tours and circuits has been published in colorful booklets that form part of the dzongkhag’s tourism development plan. These booklets are also available to visitors seeking information on area attractions. While these publications and resources (see References) include information on trekking routes, hikes, temples, Dzongs, monasteries, national parks and wildlife, among other tourist attractions, many require longer-term product development to bring them up to basic standards for international tourists. For example, many trekking routes still need to be marked with
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signage, cleaned of trash, with village homestays and tourist campsites established along the route, etc. While these more long-term product development efforts will be ongoing, the immediate focus should be to generate increased tourism arrivals in the short term of the next 1-3 years by prioritizing certain attractions and facilities to generate increased tourism opportunities for overnight visitors. This is most urgently needed in Trashiyangtse and Lhuentse, where almost all international tourists visit only on short day trips coming from Trashigang which has resulted in little economic benefit to the people of Lhuentse and Trashiyangtse. Visitors do not overnight, in part, due to the lack of effective marketing of exiting tourism products, as there is currently no clear identification or promotion of area attractions that can be experienced in 2-4 days, which would help to jump start overnight visits. Mongar, by contrast, is already well developed and receiving a relatively high number of tourists in established hotels and surrounding areas. The following product development priority strategy is therefore focused on Trashiyangtse and Lhuentse, among the poorest and least developed tourism Dzongkhags in Bhutan. The priority is to encourage and increase overnight visitation, resulting in increased economic benefits to the local people, and encouraging sustainable tourism development.
Trashiyangtse Tourism Product Development Priorities In the past, TCB has mainly emphasized the establishment of trekking routes as among the prime attractions in Trashiyangtse, along with the establishment of homestays. As a result Trashiyangtse Dzongkhag invested in the development of five home stays and several trekking routes to be ready for tourists. However, the tourists never came and the trekking routes were soon reclaimed by nature. During the field research and meetings with local homestay providers in Trashiyangtse, the consultant team were told that in the last 12 months only one of the five homestays there had one international guest and the other homestay family had two government guests. One of the biggest problems in investing in product development to open a new area of a country to increased tourism is the mistaken belief that “if you build it, they will come,” as has been referenced previously in the report. In other words, as Trashiyangtse has learned, they can create the tourism
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products like improved homestays and established trekking routes, but they must rely on TCB and tour operators to create market demand for these products.
The recommendation has been made in this report that increasing tourism in eastern Bhutan can and should start immediately through a combination of actions including: tariff liberalization, differentiated marketing and destination branding for eastern Bhutan, product development and tourism services improvement. The Tourism Development Plan for Trashiyangtse Dzongkhag, published in 2014, provides an excellent inventory of the area’s tourism development products, including extensive details on trekking routes, as well as an array of nature and cultural heritage attractions. However, rather than waiting 5-7 years to focus on international tourism arrivals as the Trashiyangtse tourism development plan recommends, waiting until all products and services can be brought to international tourism standards, it is possible (even with the current hydropower project construction) to more quickly grow the number of international tourists in Trashiyangtse right now. By focusing on the following key attractions as a short term product development priority over the next 12-24 months, Trashiyangtse can grow overnight stays, with funding support from TCB to the Dzongkhag:
Sample Two-Night Trashiyangtse Excursion: Day 1: Arrive from Trashigang and visit Chorten Kora and Handicraft Training Institute Zorig Chusum. Overnight local family Homestay Day 2: Morning trek to Denchenphodramng, visit with paper making village on the way. Explore temple and learn about sacred artifacts and spiritual practices from guide/resident caretaker. Return on village road by Mountain bike to Trashiyangtse Town. Lunch at TK guest house. Afternoon visit to Bumdeling Wildlife Sanctuary and park museum at headquarters. Day 3: Depart for Lhuentse.
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Sample Multi-day Trashiyangtse Trekking Routes: The following two treks identified in the Trashiyangtse Tourism Development Plan should be given priority for development:
Far Out East Bhutan Trek – This 4-6 day trek covers both natural and cultural heritage sites including old growth forests rich in birds, flowers and wildlife, and also includes Omba Gonpa. The trek is year round.
Omba Gonpa Trek – This 3-4 day trek can take place throughout the year and the trek to Omba Gonpa, the “Tigers Nest” of eastern Bhutan, is especially rich in cultural heritage, including traditional villages and sacred sites in addition to hiking through broad leaf and pine forests.
With the above as the short term product development priorities to generate overnight stays among international visitors, TCB can then work to support the longer-term Trashiyangtse Tourism Development plan aimed at building further international tourism arrivals over the next five years, including the establishment of at least one international tourist hotel.
Lhuentse Tourism Product Development Priorities
Of the three dzongkhags in Circuit 1, Lhuentse is the poorest in terms of economic livelihood, has the least amount of tourism development, and is the most in need of substantial economic development. Like Trashiyangtse, Lhuentse has become a “day trip” – a stop-over for only a few hours – for tourists staying in the larger regional hubs. Yet there is little economic benefit to the local community from this type of stop-over/day-trip tourism. To help promote overnight visits, and develop their capacity as a tourism product, Lhuentse Dzongkhag created the “Community- Based Sustainable Tourism Development Plan Proposal” in 2009,” which also includes an extensive list of tourism development attractions/products. According to the Governor, this plan was submitted to TCB but there was no follow up at the time. The Circuit 1 Consultant Team has reviewed this plan and recommends that this
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plan be adopted, with particular focus on the following sample itinerary. By prioritizing the increase of international tourist overnight stays in the short term, Khoma (and Lhuentse) can begin to address the dire need for poverty alleviation and village income generation.
Sample Itinerary: Khoma Village Two Night Stay To generate more overnight visits to Lhuentse Dzongkhag with the goal of increasing economic benefit, particularly to village women, Khoma – which today is a poor and unclean village – should be developed as a model handicraft village in Bhutan. Homestays should be adequately developed and serve as accommodation for the international adventure tourist market as identified by this report. Khoma needs support and funding to beautify the village and to create an attractive common area for local women to display their weavings. Three to five homestays14 should be identified, and each should be assisted with capacity training, and product and infrastructure development. These homestays should be registered and managed by TCB. Guests should have the opportunity to stay overnight, in a well-run and managed home, meet with village members and learn about traditional weaving techniques. Khoma should be developed and promoted not only as a unique and culturally experiential homestay experience in eastern Bhiutan, but if developed properly the village has the potential to become a model-run tourism village for other rural villages seeking to promote sustainable tourism growth and increase international visitation. In prioritizing the development potential of Knoma village, Bhutan has the potential to showcase a model of what properly planned and managed tourism can look like in the rural east.
Sample Trekking Routes As part of its Community Based Tourism Development Plan, Lhuentse Dzongkhag has already identified five trekking routes that could appeal to adventure tourists. In order to streamline development and boost international tourist arrivals in the short
14 During field research the consultant team identified only one working homestay where consultant team members stayed overnight, met with the homestay owners, and assesses the experience. Circuit 1 Tourism Development Plan, Draft Page | 119 August 2015
term, the Consultant Team has prioritized two of the trekking routes for immediate development.
Rodunga Trek: This trek takes 5-7 days and connects Lhuentse Dzongkhag with Bumthang. This trekking route was followed in the 19th Century by Jigme Mangyel, father of the first King. It therefore has the unique marketing angle as a historic walk, in addition to the natural beauty and biodiversity attractions in and around Thrumshingla National Park.
Lhuentse-Trashiyangtse Trek (via Dongla): This beautiful trek, used for centuries, includes remote villages, rich natural biodiversity, and stunning vistas. It also connects the two dzongkhags in Circuit 1 that are most in need to promoting overnight international tourist visitation.
Rodunga Trek and Lhuentse-Trashiyangtse Trek should be prioritized as tourism products for development in the short term; however, it is also recommended that TCB work to support the longer term Lhuentse Community-Based Tourism Development Plan. TCB should in addition work closely with Lhuentse Dzongkhag Administration efforts to bring hotel investment to the dzonghag, by advancing tourism product infrastructure and incentivizing hospitality business development. g. Addressing Gender/Vulnerability
Tourism when properly managed and sustainably developed can provide opportunities for women and other vulnerable populations to directly participate and benefit from a growing economy. However, tourism can also create conditions of exploitation and/or confine workers, disproportionately women, in low-skilled and low-paying occupations in the industry. As a tourism economy is developed in eastern Bhutan, it will be important to both provide avenues and training for rural women to participate, but also ensure that women have access and opportunities to develop their skills and participate beyond marginal income-generation activities.
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Access to tourism markets is of particular importance as eastern Bhutan develops tourism, as visitors are confined to areas where tourism infrastructure exists or is likely to develop. For those areas, women can participate directly in the tourism economy. For areas removed from direct access to visitors, the potential to develop handicrafts, agricultural products, and other value-added items and to provide those to centrally-designated locations where tourists would find them (handicraft centers or shops, farmers markets, etc., both those that currently exist and others that could be developed) are a means to further spread the benefits of tourism into the economy, to reach more people, and to improve livelihoods by supplementing traditional sources of income and livelihoods. Working with organizations such as the Handicrafts Association of Bhutan (HAB) to develop opportunities for handicraft markets at the local level in ways which benefit the greatest number of women, including those without direct access to visiting tourists, can help to distribute the benefits of the developing tourism economy along the tourism value chain, and utilize already existing resources within the country to enhance the opportunities in the east.
In addition, the main needs are for training and capacity building opportunities, and the provision of easily-accessible, short-term and locally available “courses” on topics of interest, as noted above in the section on training. Some of these training course and manuals already exist (i.e. The Homestay Operator’s Manual), and could be adapted for use in the east. Others will need to be created. In order to ensure that women in particular have access to these opportunities, the courses should be developed with appropriate literacy levels, offered at times convenient for women, and with multiple ways to complete them, leading to a steady progression of certifications earned for completion of different aspects of training. Implementing a strong system of tracking participants by gender and evaluating results as the trainings are made available will help to ensure that women are participating in what is offered.
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Adequate representation in any tourism development process at the local level will be essential to also ensuring that the perspectives, needs, advice, and priorities of rural women and other vulnerable populations (youth) are included in plans and activities as they move forward. Multiple organizations are involved in a variety of initiatives and projects in the communities of Circuit 1, and there are opportunities for coordination to enhance the benefits of the projects, to avoid duplication, to ensure alignment, and to draw on already existing resources that focus on women to enhance their participation. As tourism stakeholders are consulted to participate in the process of tourism development in the dzongkhags of Circuit 1 through the Circuit Tourism Committee, ensuring that women are adequately represented in those consultations, by collecting data on gender participation, will help to ensure that the voices of all are heard. h. Access to financial resources As tourism development in eastern Bhutan is focused on pro-poor development, and increasing direct access to tourism’s economic benefits for local communities, access to low-risk financial resources is a critical component to enabling local investment in small businesses and products. Access to micro-finance opportunities, including micro-credit is of particular importance in alleviating poverty Bringing credit, savings, and other essential banking services to impoverished and rural populations can provide a powerful stimulus for grass roots economic development and encourage local community participation. Capacity building and access to sound knowledge on how to develop products for international tourists is an important aspect to any financial investment strategy. It is important that those receiving micro-finance understand how to invest wisely in infrastructure, and which tourism products to prioritize over others. In the case of a homestay, access to microcredit can dramatically improve the experience that is offered to guests – whether better bedding to cleaner bathing facilities – a well-managed micro-credit program encourages local ownership and participation; the support of regional, coordinated marketing efforts to attract more visitors leads to an increase in homestay guests, thus allowing the homestay owner to repay the microcredit loan
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while also increasing revenue. Organizations like BRAC (formerly the Bangladesh Rural Advancement Committee) have a long history of success with microfinance in support of economic development specifically aimed at the poor; schemes that combine access to financial resources with other capacity building support have been successful in helping improve the lives of those seeking to engage in opportunities for economic development. We recommend that TCB work with stakeholders to establish a system for offering micro-credit and other financial resources particularly aimed at small business development, in order to help spur the development of a tourism economy in eastern Bhutan.
VI. Conclusion
Bhutan has stated two ambitious goals for the development of its tourism economy: (1) Increase annual tourist arrivals to 200,000 by 2020. As tourism arrivals in 2014 were just over 104,000, this figure is a 192% increase in arrivals over the next 5 years. (2) Sustainability must remain at the heart of Bhutan’s tourism economy. The vision for Bhutan tourism is “To foster a vibrant industry as a positive force in the conservation of environment and promotion of cultural heritage that safeguards the sovereign status of the Nation and significantly contributes to Gross National Happiness.” (TCB, p. iii) These two goals demonstrate that Bhutan not only seeks to continue growing its national tourism industry, but seeks to ensure that these benefits are evenly distributed throughout the country: currently tourism and its attendant benefits are consolidated disproportionately in the western region of the country while eastern Bhutan remains underdeveloped and impoverished. This report consolidates six months of intensive research – including extensive meetings with regional and national stakeholders – and incorporates global sustainable tourism expertise that brings context and understanding to Bhutan’s current position in the global travel marketplace, as well as the potential for Eastern Bhutan to emerge as a distinct and unique destination. In order for Eastern Bhutan to enter the travel sphere as an emerging destination, a clear plan of action is needed – one that incorporates a
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multi-pronged approach to building the tourism economy, in realistic steps, with the commitment at both the national and local levels to implement, engage, monitor, and evaluate short and long term progress.
Commitment to implementation and management of progress is crucial to getting Eastern Bhutan’s tourism industry off the ground. Bhutan has commissioned several previous consultants to research tourism development in the country, yet while these consultants have made recommendations, their reports have often simply gathered dust on a shelf with little measures made towards implementing the actual recommendations. The goal of this report is for Bhutan to move forward into actual implementation; that decision to move forward, however, rests internally and exclusively with Bhutan and its tourism stakeholders.
The findings and recommendations of this report outline a series of steps that can initiate a realistic process for tourism development in Eastern Bhutan. The goal of this report is not only to highlight the challenges and economic barriers that have impeded tourism growth in the east, but instead to present a plan that realistically addresses these ongoing challenges, and orients the region to both short and long term growth. Bolstering infrastructure and access to Eastern Bhutan, providing tourism and hospitality training, improving international marketing, and addressing tourism policy constraints to the region are all measures that will help establish tourism as means of economic growth, poverty alleviation, and income generation for local stakeholders.
As this report moves from research and publication to discussion with stakeholders, and ultimately implementation, it is important to note that due to the diversity of Bhutan’s tourism stakeholders and the multiplicity of their interests, not all recommendations of this report may be welcomed by each individual. This report was written with the single objective of putting forward researched and founded recommendations for how to stimulate tourism development and economic growth in Eastern Bhutan: a region that by and large views tourism as one of the only viable
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economic opportunities for impoverished rural peoples and government administrations. Whether or not the Bhutanese government and its diverse body of tourism stakeholders agree with all of the recommendations in this report, or choose to implement any or all of them, remains an important albeit internal decision for Bhutan.
The aim of the report is to provide TCB with an objective and researched strategy for developing tourism in Eastern Bhutan, and to provide the key and implementable recommendations for achieving Bhutan’s tourism goals. A summary of these core recommendations follows.
Institutional Capacity Combine Circuit 1 and Circuit 2 into one consolidated Eastern Bhutan Circuit Tourism Development Plan. Monitor implementation through a Circuit Tourism Development Committee that includes a representative from each of the six dzongkhag administrations. Assign a TCB Tourism Officer based in the region to spearhead implementation and the management of all tourism development actions, and oversee the Circuit Tourism Development Committee. Ensure local stakeholder participation and engagement through education and involvement in the Circuit Tourism Committee; ensure adequate stakeholder representation from women and other vulnerable populations.
Improve Tourism Infrastructure to Support Increased Tourist Arrivals Create reliable and routine air service into Eastern Bhutan via Bumthang and Yongphula regional airports. Support the development of regional accommodations, with particular emphasis on improving the availability, quality, and quantity of local home and farm stays.
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Differentiate Contextual Identity and Tourism Marketing for Eastern Bhutan Rebrand the Circuit 1 and 2 dzongkhags as “Bhutan’s Wild East” or “Wild Beauty: Eastern Bhutan”: with unique terrain and rugged landscapes, the “Wild East” can promote adventure-based activities and more in-depth cultural tourism. Target the Adventure Travel Market: Adventure travel is a booming sector of the global travel market, and should become the cornerstone of the eastern region’s tourism experience. Target the fast-growing Millennial Travel Market: These younger, more adventurous travelers are poised to become a tour de force in the global travel market and will reach their prime working, earning, and spending years over the coming decade.
Implement Effective Training and Capacity-building Substantially invest in/develop human capital in the tourism and hospitality industries. Implement a regional hospitality and tourism training program that requires all hospitality workers to register and take part in some degree of training. Utilize a mobile training model that can work in both regional urban centers as well as small villages, and responds to the needs of women, youth, and other vulnerable populations in terms of literacy, timing, accessibility, etc. Initiate coordinated efforts to design and direct a variety of training curriculums; utilize local, regional and international assistance and support. Implement beautification efforts, including consistent removal of trash residue, construction rubble, and animal waste in villages and small towns, in order to improve the standards of tourist attractions.
Liberalize the Daily Tariff Policy Recognize the extensive limitations that the current daily tariff of US$250 has imposed (and will continue to impose) on the development of a tourism economy in Eastern Bhutan:
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o Current daily tariff is a disincentive for travel to Eastern Bhutan, where the quality of tourism services does not provide value for the daily spend. o Current daily tariff is a disincentive for the adventure and millennial traveler markets most interested in what Eastern Bhutan offers as a tourism destination. Eliminate the tariff for all travel to Eastern Bhutan; keep the royalty fee of US$65/day for all tourists (international and regional), which will: o Strongly incentivize an increase in international tourist visitation to the eastern region, and o Reduce the conflict between the two different tourism policies that apply to international and regional visitors. Concede that elimination of the tariff while keeping the daily royalty fee for all tourists (international and regional) safeguards against the extremely low-budget, high-impact tourists that Bhutan seeks to avoid.
Prioritize tourism product development Recognize that the dzongkhags of Circuit 1 and Circuit 2 have already established extensive inventories of their attractions; yet, o Many of these tourism products require longer-term product development and substantial investment to bring them up to the basic standard acceptable for international tourists; o The immediate focus in Eastern Bhutan must be generating increased tourism arrivals over the next 1-3 years by prioritizing certain core attractions and facilities. Increase available accommodations at an acceptable standard for international tourists, in order to bolster regional overnight accommodation and bed-nights. Develop a core set of Eastern Bhutan tourism excursions and activities that can become the foundation for tours in the east, and can serve as a model for subsequent activities development in product conception, management, and roll out.
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Utilize the Circuit Tourism Committee and Tourism Officers to ensure coordinated tourism product development, in consultation with local stakeholders, for short and long term development projects.
Promote Gender Equality and Economic Participation Improve access to tourism markets for women and vulnerable populations. Develop centralized markets for handicrafts, agricultural products, and other value-added items to further spread the benefits of tourism into the far reaches of the region. Improve local stewardship by enabling women and other vulnerable populations to have direct interaction with tourists, thus seeking to mitigate the negative effects of middlemen buyers/sellers on individual revenues and profits.
Improve access to financial resources Develop micro-credit, and financial and lending opportunities to enable, empower, and encourage local community engagement and economic participation with the tourism industry. Ensure tourism investment policies support and incentivize private sector tourism enterprises to participate in tourism development in Eastern Bhutan.
These recommendations for implementation are based on in-country, regional and international research and field work conducted by the consultant team between March and September of 2015. While this report seeks to be as extensive as possible in its recommendations for promoting sustainable tourism growth and the development of a tourism economy in Eastern Bhutan, these recommendations are by no means exclusive to further research and contribution.
In order to achieve the ambitious tourism growth that is envisioned for Eastern Bhutan, a coordinated and effective multi-stakeholder approach – with investment, commitment, and participation from international, national, and local authorities – is needed to realize the extensive tourism opportunities in the six dzonghags of Eastern Bhutan. Efforts which empower effective local engagement, in coordination
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with national support and policy changes, can orient the region towards both short term and long term growth, and promote the dispersion of tourism benefits and the positive benefits of its development more widely and more evenly throughout the country.
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VII. Implementation Plan
This draft Implementation Plan will be revised upon further input from stakeholders.
IMPLEMENTATION PLAN FOR EASTERN BHUTAN CIRCUIT TOURISM DEVELOPMENT PLAN
Responsible Implementation Activities Evaluation Comments Agency(s) Year(s)
Institutional Development Objective 1: Tourism development management for Eastern Bhutan at the national, dzongkhag and local levels improved Circuit 1/Circuit 2 Tourism Completion of Eastern Development Plans merged into one TCB 2016 Bhutan Tourism Eastern Bhutan Tourism Development Development Plan Plan Dedicated Tourism Officer assigned in Number of Tourism TCB 2016 each dzongkhag in Eastern Bhutan Officers assigned Tourism Officer capacity and Tourism Officer understanding of destination tourism TCB 2016-2017 evaluations, trainings development supported and enhanced completed Eastern Bhutan Circuit Tourism Number of CTC Committee formed, with balanced meetings, attendance representation (including women, Dzongkhags 2016 by role, gender, private sector, public sector, etc.) from tourism sector each of the six dzongkhags, including involvement. Tourism Officers. Decision-making authority and TCB, in Progress reports 2016 responsibility for carrying out the consultation indicating CTC
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implementation of the Eastern Bhutan with implementation, Circuit Tourism Development Plan dzongkhags including by role and established and responsibility stakeholders Regular and on-going engagement of TCB, Tourism CTC in implementing, evaluating, Officers, local Record of meetings, adjusting and advancing tourism dzongkhags 2016-2018 actions, progress development implementation in and reports Eastern Bhutan stakeholders Infrastructure Development
Objective 1: Transit to Eastern Bhutan improved Establish schedule of flights to Eastern TCB, Drukair, Airline schedules by Bhutan, to coordinate with 2016 - 2018 Tashi Air route international flight arrivals Objective 2: Availability and quality of homestay/farmstay accommodations Improved
Inspect all current Eastern Bhutan TCB 2016 Inspection reports homestays/farmstays Develop homestay manual for Eastern Bhutan (adapt existing RSCN Phobjikha TCB 2016 Homestay manual homestay manual) Training records, including attendance Provide training and capacity building by gender, training TCB, Tourism for new/existing homestay/farmstays in 2016-2018 certificates issued, Officers Eastern Bhutan number of homestays/farmstays sanctioned and
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registered in Eastern Bhutan.
Marketing Plan
Objective 1: Marketing plan to differentiate Eastern Bhutan developed and implemented New identity to differentiate Eastern TCB, in Progress reports on Bhutan, i.e. Bhutan’s “Wild East” or consultation development of 2016 “Wild Beauty: Eastern Bhutan” or with local Eastern Bhutan similar, created stakeholders marketing identity Marketing plan focused on new Eastern TCB 2016-2017 Marketing plan Bhutan identity developed TCB, in Marketing targets expanded to include consultation adventure travelers, as part of Eastern 2016-2017 Marketing plan with marketing Bhutan marketing plan experts TCB, in Marketing targets expanded to include consultation millennial travelers, as part of Eastern 2016-2017 Marketing plan with marketing Bhutan marketing plan experts Coordinated marketing plan for Tourism Monitor differentiated Eastern Bhutan that annual reports of targets new international tourists, ages TCB 2016-2018 visitor arrival numbers, 25-55, with focus on active adventure ages of visitors; to unique and remote region marketing statistics implemented Training and Capacity Building
Objective 1: Hospitality training in Eastern Bhutan improved
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Develop short-course curriculums with certificates of completion in food services, hospitality, homestay management, small business TCB, Tourism Number of short- development, English language skills, Officers, CTC, course curriculums 2016-2018 first aid and safety, in consultation with Local developed and local stakeholders to determine needs. Stakeholders available for training. Ensure literacy levels are appropriate to empower participation by women, youth, and rural poor. Develop mobile training plan and process, utilizing Tourism Officers TCB 2016-2017 Training plan and/or other trained personnel. Implement training offerings in Eastern Number of people Bhutan, with attention to TCB, in trained per course, by time/location/access to enable coordination 2017-2018 age and gender; visitor participation by women, youth, and with CTC satisfaction surveys other vulnerable population groups. Objective 2: Guide and activity training in Eastern Bhutan improved Develop short-course curriculums with certificates of completion in specialized guide training, such as natural history, Buddhist art and history, water tours TCB, Tourism Number of short- (kayaking, etc.). Include specific TCB, Tourism Officers, CTC, course curriculums training components on how to 2016-2018 Officers, CTC, Local Local developed and lead/guide tour groups, including first Stakeholders Stakeholders available for training. aid and safety. Ensure literacy levels are appropriate to empower participation by women, youth, and rural poor.
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Develop mobile training plan and Develop mobile training plan and process, utilizing process, utilizing Tourism Officers TCB 2016-2017 Training plan Tourism Officers and/or other trained personnel. and/or other trained personnel. Implement training offerings in Eastern Bhutan, with Implement training offerings in Eastern Number of people attention to Bhutan, with attention to TCB, in trained per course, by time/location/access time/location/access to enable coordination 2017-2018 age and gender; visitor to enable participation by women, youth, and with CTC satisfaction surveys participation by other vulnerable population groups. women, youth, and other vulnerable population groups. Develop mobile training plan and Develop mobile training plan and process, utilizing process, utilizing Tourism Officers TCB 2016-2017 Training plan Tourism Officers and/or other trained personnel. and/or other trained personnel. Objective 3: Tourism awards program recognizing tourism best practices, including sustainable tourism, established and implemented Develop tourism awards program to recognize best practice in the tourism TCB, in industry across sectors, with focus on consultation 2016 Awards program plan sustainable tourism principles, and with tourism recognizing sectors such as homestays, stakeholders handicrafts, etc. in addition to more
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standard tourism sectors (i.e. hotels, tour operators, etc.) Implement tourism awards program, to Results of awards highlight best practice in tourism TCB 2017 program – winners, throughout the country. finalists, media, etc. Provide specific encouragement/incentives for Media outreach, participation in tourism awards to application records developing tourism areas and sectors, i.e. Eastern Bhutan. Objective 4: Local beautification efforts increased Meetings held to Consultations with TCB, CTC, and local address beautification TCB, CTC, local stakeholders to determine how to 2016 issues, attendees by stakeholders improve waste management gender, age and occupation Beautification plan developed for TCB, CTC, local Eastern Bhutan, including funding 2016 Beautification plan stakeholders mechanisms CTC, local Benchmarks achieved, Beautification plan implemented, stakeholders, specific actions including specific actions and 2016-2018 with support undertaken and benchmarks from TCB achieved Tariff Policy
Objective 1: Scenarios for liberalizing tariff/royalty fee policies for Eastern Bhutan evaluated
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Tariff policy meetings, TCB, in including attendance Tariff policy reviewed, including daily consultation by gender, age, and tariff, royalty fee, international and 2016 with tourism occupation. Action regional tourists. stakeholders steps of meetings noted. TCB, other New tariff/royalty fee policy for Eastern government 2017 New tariff policy Bhutan decided agencies Objective 2: Changes to tariff policy for tourists to Eastern Bhutan implemented TCB, other New tariff policy announced and government marketed to international and regional Announcements of agencies and 2017 visitors as part of overall tourism tariff policy revisions tourism marketing plans stakeholders Tourism arrivals by TCB, other dzongkhag, tourism New tariff policy implemented government 2017 revenues, other agencies economic indicators of tourism sector growth Product Development
Objective 1: Circuit 1 priority products selected and developed Establish 1-2 overnight excursion TCB, CTC, itineraries for each of the three tourism dzongkhags in Circuit 1, with focus on stakeholders, 2016 Overnight itineraries Trashiyangtse and Lhuentse, using local Circuit 1 Tourism Development Plan stakeholders report as a guideline
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Provide support, training, and capacity building to ensure that chosen short- TCB, Tourism Training records, TCB term products will respond to increased Officers, local 2016 licensing and market demand at appropriate quality stakeholders registration records and service standards Increased tourism arrivals and bednights Launch chosen overnight excursions TCB, tourism in Circuit 1 dzongkhags, through marketing channels for Eastern Fall 2016 stakeholders visitor satisfaction Bhutan, tour operators, etc. surveys, age breakdown of tourists Objective 2: Circuit 2 priority products selected and developed Establish 1-2 overnight excursion TCB, CTC, itineraries for each of the three tourism dzongkhags in Circuit 2, using the stakeholders, 2016 Overnight itineraries Circuit 2 Tourism Development Plan local report as a guideline stakeholders Provide support, training, and capacity building to ensure that chosen short- TCB, Tourism Training records, TCB term products will respond to increased Officers, local 2016 licensing and market demand at appropriate quality stakeholders registration records and service standards Increased tourism arrivals and bednights Launch chosen overnight excursions TCB, tourism in Circuit 2 dzongkhags, through marketing channels for Eastern Fall 2016 stakeholders visitor satisfaction Bhutan, tour operators, etc. surveys, age breakdown of tourists Objective 3: Eastern Bhutan Circuit Tourism Development Plan product development selection process established
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Product development inventories for each dzongkhag in Eastern Bhutan TCB, Tourism All inventories collected by CTC, using already 2016 Officers, CTC collected completed consultancy reports and inventories Product development selection process CTC, in Selection process, established by CTC for Eastern Bhutan, consultation tourism products using destination development with TCB, local offered in Eastern 2017 framework, adhering to sustainable stakeholders, Bhutan, tourist tourism criteria, and working with local tourism visitation and bed- stakeholders enterprises night statistics Addressing Gender/Vulnerability
Objective 1: Access to training and capacity building improved Develop short-course curriculums with certificates of completion in food services, hospitality, homestay management, small business TCB, Tourism Number of short- development, English language skills, Officers, CTC, course curriculums 2016-2018 first aid and safety, in consultation with Local developed and local stakeholders to determine needs. Stakeholders available for training. Ensure literacy levels are appropriate to empower participation by women, youth, and rural poor. Develop mobile training plan and process, utilizing Tourism Officers TCB 2016-2017 Training plan and/or other trained personnel. Implement training offerings in Eastern TCB, in Number of people Bhutan, with attention to coordination 2017-2018 trained per course, by time/location/access to enable with CTC
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participation by women, youth, and age and gender; visitor other vulnerable population groups. satisfaction surveys
Objective 2: Access to tourism development opportunities improved CTC to develop framework for empowering and encouraging women Number of women to participate in direct tourism services, CTC, with local participating in tourism 2016 including as hoestay providers, food stakeholders sector activities, by service providers, handicraft and food dzongkhag producation. Objective 3: Access to tourism market opportunities improved CTC to develop framework for creating Number of women centrally-located markets for CTC, with local participating in tourism 2016 handicrafts and other tourism-related stakeholders sector activities, by products. dzongkhag Systems established for local Handicraft centers, handicrafts and other income- markets established, generating products to be sold at CTC, with local 2016-2017 number of women centrally-located local markets, with stakeholders selling products, value supply chains and fair pricing systems of goods sold implemented. Access to Financial Resources
Objective 1: Availability of micro-finance and micro-credit systems established Evaluate possibilities to establish micro- TCB, in Report on micro-credit, finance and micro-credit systems at the consultation 2016 micro-finance dzongkhag level for tourism with other opportunities development in Eastern Bhutan government
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agencies, NGOs Micro-credit lending, Establish micro-credit system, in TCB, CTC, loans by gender, age, consultation and coordination with CTC tourism 2017 occupation, tourism and Tourism Officers Officers product development inventories Objective 2: Tax incentives and other government policies for tourism development in Eastern Bhutan improved
Evaluate current tax holidays/incentives TCB 2015 for the tourism sector TCB, in consultation with local Revise tax incentives for the tourism governments sector, including specific incentives for Revised tax incentives and other 2016 promoting tourism development in rules government Eastern Bhutan agencies, tourism stakeholders
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Program Profiles
Program Profiles will be developed for the final report, based on consultations and feedback with stakeholders on priority projects for development and assistance.
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