Private sector has high potential to create more employment, says WB’s report

Bhutanese private sector has high potential to create more and better employment opportunities in the country, provided planned investments are made. This is reflected in the World Bank’s (WB) standard study report “Bhutan Investment Assessment Report,” released recently.

Tourism, Information and Communication Technology and Agri-business are some of the sectors with better prospective to attract investors, create employment and high value exports.

However, the report reveals that currently the firms are struggling to grow due to obstacles that hinder investment, productivity and international trade as the employment remains concentrated in the public sector.

Access to limited finance and lack of skilled labour also undermined efforts to increase productivity and attract investment.

“For example by improving collateral system in terms of access to finance , in terms of access to skills, providing more vocational training but also allowing more easy entry of skilled migrants into the economy,” said Qimiao Fan, the Country Director of Bhutan, Bangladesh and Nepal, World Bank. “And in terms of access to market, some of these recommendations are related to improving logistics, customs and skills of people working in the logistic sectors.”

The report also concludes that access to firms to domestic and international market is further limited by lack of transport, logistics, marketing, and policies to encourage competition. Modifications to financial sector regulations to improve access to credit, reducing the compensation gap between private and public sectors and scaling up Brand Bhutan promotions are some of the reforms recommended.

“Most of these recommendations are very much aligned with the government’s economic development programs and many of these measures are included in the government’s policies,” added Qimiao Fan.

He further went on saying that the report will provide some analytic background, advice to the government when they formulate economic policies in particular when formulating policies related to the investment climate.

The report is based on surveys and interviews of some 13,000 business entities conducted in the 2014 and 2015. It is a collective effort of different agencies such as Tourism, Agriculture, Trade and Industry among others.

 

 

 

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