Phuentsholing City

An unsustainable increase of hotels impacts the hotel business in Phuentsholing

According to the hoteliers in Phuentsholing, low occupancy resulting from the increasing number of hotels and rented apartments being converted into hotels, shortage of labor and immigration issues are common concerns.

The increase in the number of hotels is so high that even the high the number of tourist arrivals are not able to fill up hotels. Many of them were constructed or modified with an eye on the fiscal incentives from 2010 and also the growing number of regional tourists.

According to the information provided by the Department of Trade, there are about 78 hotels in Chukha dzongkhag including both tourist standard hotels and budget hotels of which 67 are budget hotels and 11 are tourist standard hotel. Only 8 tourist standard hotels are registered with the Tourism Council of Bhutan (TCB).

Tashi Namgay Grand’s is a four-star hotel. Its owner, Passang Dorji said an increase in the number of hotels and residential apartments being converted into hotels, shortage of employees and immigration issues are the challenges impacting hoteliers in Phuentsholing.

Passang Dorji, the hotel owner said, “There are a number of hotels in Thimphu and Paro and the number of tourist arrival is also high but in Phuentsholing, in contrast to lower tourist inflow, the number of hotels are increasing every year in addition to a huge number of hotels that are already there,”

He said, “The number of hotels has become so huge in the recent years because most of the residential apartments are being converted into hotels and there are some involved in Airbnb which has eventually resulted into low occupancy and are threatening the sustainability of hotels.”

He further said, “Another challenge that hoteliers face in Phuentsholing is that we have to compete with hotels in Jaigaon who offers services at a cheaper rate.

The number of hotels and apartments being converted into hotels is also increasing in Jaigaon”.

“The number of tourist’s arrival is low in Phuentsholing due to immigration issues. During weekends and government holidays, the immigration office is closed and this has significantly reduced the number of regional tourists. The introduction of Sustainable Development Fees for regional tourists would further reduce the number,” he said.

A three-star hotel, Hotel Ga Me Ga said that shortage of labor and an increasing number of the guesthouses by corporate offices has become a source of huge distress for hotels in the area.

The General Manager of the hotel said, “Shortage of labors including cooks has become the biggest challenge for hoteliers as we have to employ Indian workers without work permits. Hiring foreign workers is a risky task we have taken but we do not have other options as most of our Bhutanese prefer jobs in which they are highly paid”.

He said, “The number of guesthouses is also increasing and it is a concern for hotels because in the past when there were few guesthouses, we received both foreign and local guests but now with so many guesthouses coming up, visitors who come on official tours be it international or local stays in guesthouse because they are not charged and this has greatly affected our business”.

Another three-star hotel, Lhaki hotel said that though the average occupancy of the hotel is good so far with 50 to 60 percent, the increasing number of hotels would affect all the hotels in Phuentsholing in the long run.

Namgay Wangchuk, Manager of the hotel said that almost every hotel in Phuentsholing is facing a shortage of labor which has resulted in hiring foreign workers and this is not good for the country.

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