The Bhutanese economy shrank to an all-time low of minus 10.08 per cent last year amid the pandemic. It is almost a 16 per cent drop as compared to a growth of 5.46 per cent in 2019. The economy of a country is measured by the Gross Domestic Product or GDP, which is the total goods and services produced within a country during a given period of time.
Bhutan’s GDP dropped to Nu 171.57bn last year from Nu 178.56bn in 2019. Among the major economic sectors, the industry sector like mining & quarrying, and construction were the main sectors that led to a fall in the growth of the economy. The hydropower has, however, done exceptionally well last year. The high growth in the sector was mainly due to the full commissioning of the Mangdechhu Power Plant.
The fall in the GDP is also attributed to service sectors like hotels & restaurants, and recreational services dependent on the tourism sector crippled by the pandemic.
However, the primary sector like Agriculture, Livestock and Forestry recorded a growth of 4.57 per cent, an increase of more than three per cent from 2019. This was one of the highest growth rates in the past five years.
“If you look at the agriculture sector, the pandemic has not much effect. There is growth in this sector. The other two major sectors of industry and service sectors are the hardest hit. We depend on the tourism in the service sector and for industry, again we have to depend on the Indian market, both for raw materials and exports,” said Sonam Lhendup, the Deputy Chief Statistical Officer at the NSB.
There was also an increase in the expenditure from the government for wages and salary, office equipment and expenditure on health sectors.
With a population of almost 750,000, the GDP per capita for 2020 was estimated at almost Nu 230,000. This is a drop of more than Nu 11,500 from the previous year.
This was the first time that the country’s GDP fell below zero in three decades. The last was in 1991 when the GDP slumped to minus 0.4 per cent.
Samten Dolkar
Edited by Sonam
