The mesmerizing kingdom of Bhutan, nestled in the Himalayas, has announced a significant reduction in its daily tourist fee in order to boost the struggling tourism sector, which has been slow to recover since the end of COVID-19 restrictions.
Previously, Bhutan had set a “Sustainable Development Fee” of $200 per visitor per night, up from $65, after the lifting of two years of COVID restrictions in September last year. The increased fee was aimed at offsetting the carbon footprint caused by tourists.
However, starting from September, the new rate of $100 per night will come into effect and will be applicable for the next four years, as stated by the government in a recent statement.
The government emphasized the importance of the tourism sector in terms of generating employment, foreign exchange earnings, and overall economic growth. Therefore, this reduction in the daily fee aims to attract more tourists and stimulate the economy.
Bhutan, which was isolated from the world for many years, first opened its doors to tourists in 1974 and received a modest number of 300 visitors. Over the years, the popularity of Bhutan as a tourist destination has grown exponentially, with a record 315,600 visitors in 2019, showing a 15.1% increase from the previous year, according to official data.
Despite the surge in tourism, Bhutan has always been cautious about the impact of mass tourism on its delicate environment. The country strictly prohibits mountain climbing to preserve the sanctity of its majestic peaks. As a result, the high tourist fee has limited the number of arrivals to those who can afford it, contributing to only a fraction of the tourist numbers compared to its neighboring country, Nepal.
Nevertheless, Bhutan aims to boost the contribution of tourism to its $3 billion economy from about 5% to 20%.
Dorji Dhradhul, the director general of the Department of Tourism, believes that the reduction in the tourist fee could lead to an increase in tourist arrivals during the peak season from September to December. This period is particularly significant as it coincides with numerous religious and cultural events in the mainly Buddhist country.
In June, the Bhutanese government relaxed rules regarding the duration of tourist stays and fees. However, the expected increase in tourist numbers has not yet been realized.
Dhradhul noted that more than 56,000 tourists have visited Bhutan since January, but the majority of them (about 42,000) were Indian nationals who only have to pay a fee of 1,200 Indian rupees ($14.5) per day.
The tourism industry in Bhutan plays a vital role in the country’s economy, employing around 50,000 Bhutanese citizens and generating an average of $84 million in foreign exchange annually in the three years prior to the pandemic.