Bhutan, with it's natural beauty, rich wildlife and unique culture makes a wonderful and exotic tourist destination. However, it was only in 1974 that Bhutan was opened to international tourism, beginning modestly with only 287 visitors.
Bhutan's tourism policy is reflective of the larger development philosophy within Bhutan. While the government's basic goal, as with other developing countries, is to improve the living standards of its people, development in Bhutan is not judged merely by material prosperity and income growth. The Royal Government of Bhutan has repeatedly affirmed the importance of less quantifiable but more meaningful goals such as the happiness, contentment, and the spiritual and emotional well-being of its people. Thus, the government has taken a cautious approach to development. The Royal Government's view is that modernization and development should be guided by the "Gross National Happiness" of the Bhutanese people, rather than by the Gross National Product. Likewise, development should be consistent with Bhutan's capacities and needs.
The Royal Government of Bhutan recognizes that tourism is an important means of achieving socio-economic development. It also recognizes that tourism, by encouraging travel to other countries, can promote understanding among people and build closer ties of friendship based on appreciation and respect for different cultures and lifestyles. There are, however, problems associated with tourism which, if not controlled, can have devastating and irreversible impacts on the environment, culture and identity of the people. Realizing these problems and the fact that the resources on which tourism is based are limited, the government recognizes the need to develop the Bhutanese tourism industry based on the principle of sustainability (i.e. it must be environmentally friendly, socially and culturally acceptable, and economically viable).
Rather than limiting the number of visas issued, tourist arrivals are controlled by a pricing policy. This pricing policy means that tourists must Travel to Bhutan on a package tour, organized by Bhutanese tour operators (foreign travel agents are not allowed to operate in Bhutan). The whole itinerary, whether it be a cultural tour, trekking or a mixture of both, is organized by the tour operator. The fully inclusive price set by the government is presently US$200 per day, per person. Of this tariff, a 10% commission goes to the external foreign travel agent, 35% is paid as a government royalty, and the remainder is the tour operator's to be spent in Bhutan. The tariff increases if tourists want totravel alone or in very small groups. This is because these small groups incur higher per capita expenditure and have a greater impact on the environment than larger groups. There are however concessions available for children and students. If at any point it is felt that the number of arrivals is escalating out of control, the pricing policy may be reviewed and the prices increased. The manageable level of arrivals will depend on the current infrastructure in the country. As infrastructure improves, the carrying capacity will rise.
Bhutan Visa formalities are another means of ensuring that Bhutan, rather than customer demand, dictates the number of arrivals. Visas are not available upon arrival at any of the borders or the airport. Visas must be processed in advance of arrival, and clearance given by the Ministry of Foreign Affairs before tickets are issued to enter the country. All visa applications for tourists are processed through TAB, as are all visa extensions. This means that TAB is at all times aware of the number of tourists in Bhutan and ensures that the government royalty is always collected.
Local Participation in Tourism
Because of the government's "High Value - Low Volume" policy, tourism in Bhutan has a very favorable income to arrivals ratio. The government monitors this ratio very carefully so that the money the tourist spends is directed to businesses in Bhutan, rather than to large overseas travel agents. These agents usually sell 'package' holidays, and in many cases the percentage of revenue that actually gets to the host country is very small. In Bhutan, tour operators are given the chance to receive revenue directly from the price of the holiday, and the Bhutanese people receive an income from the tourists by way of the government royalty. This royalty collected makes up one sixth of the country's income, and one third of all foreign exchange earned. This is an important source of revenue for the Bhutanese people since all health services and education are provided by the government for free. Other examples of how tourism earnings get to the local communities: 1. Repairing and maintaining trekking trails. In many instances, park managers award contracts to local people for the maintenance of foot bridges and trails. 2. The rest and community houses along trekking routes, that were built by the government prior to the privatization of tourism, have been handed over to local residents. The income generated from tourists and trekking staff goes directly to the local community, and they have full control over these shelters. 3. Local communities along trekking routes supply provisions for trekkers. This provides additional income for local people.
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