While the country is looking forward to graduate from the LDC group in 2023, Bhutan’s inability to fulfill the economic vulnerability index, one of the three criteria for graduation, indicates that the country’s economy is shallow and superficial.

Its direct impact, according to Prime Minister Dr Lotay Tshering is on unemployment, which is going to continue for some time. Underemployment, he said has not even been recorded and if proper instruments are not put in place, it will pull the underemployed back to the pool of unemployed.

“If we don’t plan and invest wisely, we are heading for a big crisis,” Lyonchhen said. “If unemployment is not addressed, GNH will be a far-fetched dream.”

As Bhutan released its first economic census yesterday, Lyonchhen said that the report should have been launched before the finalisation of the 12th Plan and the endorsement of FDI and CSI policies.

“This is how we are functioning, framing policies without evidence,” he said. After the National Statistical Bureau (NSB) announced that the next survey would be done after a decade, Lyonchhen insisted that the next report be published in the first half of 2023 and make it accessible to everyone. 

“This will help the parties formulate their manifestoes and pledges based on evidence unlike in the past,” he said.

World Bank resident representative, Yoichiro Ishihara said that Bhutan’s statistical indices are lower than the average of South Asia. Data predictability, frequency and availability, he said is low.

For instance, he said the national accounts data is the most important and that the GDP figures are revealed much later, which could delay interventions. “It is like you go for a medical check-up and your reports are known after seven months,” he said.

However, he said the economic census is a big first step. “It now depends on how you use the data to formulate policies.”

The director of NSB, Chhime Tshering said that lack of support and willingness to share data from the establishments, households and agencies was the most daunting task for the bureau. “Most often we had to rely on personal relations to secure data,” he said.

He sought the support of the government to draft a statistical Bill to ease the process of data gathering and professional use of data.

Lyonchhen said that time has come to centralise data and gather quality reliable data with improved access. He informed that the 12th Plan’s digital drukyul flagship would cater to the issue.

 

The Economic Census

According to the results of the Economic Census of Bhutan (ECoB) 2018–19, as of December 31, 2017, there are about 14,000 establishments engaged in different economic activities in the country.

This excludes household-based crop production, public administration, and defense services. Of the total number of establishments, 8,900 (63.5 percent) are located in urban areas and 5,100 (36.5 percent) in rural areas. Four dzongkhags—Thimphu (24.9 percent), Chhukha (13.6 percent), Sarpang (8.1 percent), and Paro (6.2 percent)—together accounted for 52.8 percent of the total establishments in the country.

The distribution of establishments by legal status and by economic organisation is dominated by establishments that operate as single establishments under single proprietorship or partnership ownership, accounting for 12,700 or 90.5 percent of all establishments in the country.

Almost all single proprietorships, partnerships, or permanent shed vendors operate as single establishments.

Mean duration of private limited company is at least 13 years, whereas that of other establishments is below eight years. State-owned limited companies have on average the longest operation duration (16 years). The single proprietorship and partnership establishments that make up the largest category of establishments in terms of legal status operated on average only for around six years.

On gender, male between 35-39 years own maximum firms. Female has maximum ownership between 20-39 years.

However, there is a large gender difference in terms of educational attainment among establishment owners. Some 39 percent of female owners have no education at all, compared to around 26 percent of the male owners. On the other hand, 13.7 percent of the male owners completed university education against only 5.2 percent of the female owners.

The ECoB reveals that for every 100 female establishment owners in the lowest two educational categories there are, respectively, only 86 and 94 male owners. But for owners with more advanced education—vocational and tertiary education—the gender ratio is in favor of men, 446 and 264 men for every 100 women.

In terms of the number of establishments, the economy is dominated by two economic sectors: wholesale and retail trade, repair of motor vehicles and motorcycles with 62.5 percent (more than 8,700 establishments), followed by accommodation and food service activities with 21 percent (2,900 establishments). The next largest section is manufacturing representing only 5.1 percent of all establishments.

On employment, from the total of 74,000 persons employed in various sectors, the highest share (24.1 percent) of employment is observed in the wholesale and retail trade sector, followed by the construction sector, which employs 18.5 percent of the total employment.

The share of employment of women is also higher than men in sectors like accommodation and food services and arts and entertainment.

A significant difference is observed in the construction and mining sector, where the proportion of male employment is six times higher than female employment. “To a large extent, this can be attributed to the population of male non-Bhutanese workers, who are employed as either contract or casual-paid employees in these sectors,” the report stated.

In terms of wages, an NSB official said that the least paid employee are in art and entertainment business.

The survey also revealed that more women than men are in the three lowest remuneration categories (below BTN 15,000), more than half (54.1 percent) of the female workers against just over one-third (35.6 percent) of male workers.

At the higher end of the remuneration scale, gender distribution is more balanced again, with even a slightly higher representation of women in the highest remuneration category.

Lyonchhen said that only seven percent of the university graduates are employed in various economic sectors. “This means that a big chunk of university graduates fall in the unemployed category and this is worrying,” he said.

The ECoB was conducted by 80 enumerators with the help of dzongkhag statistical officers spanning over two and half months. The survey was initiated by the NSB with support from the World Bank.

Tshering Dorji

Advertisement