The Bhutanese Leading the way.
According to the Opposition Party, the hotel industry, particularly 3-star establishments and below, continues to face severe economic distress, first triggered by the COVID-19 pandemic and later exacerbated by unintended impacts of the country’s revised tourism policy.
Despite being one of the hardest-hit sectors, the Opposition stated that these hotels were excluded from the Economic Stimulus Programme (ESP) concessional loan scheme, despite repeated appeals from the industry stakeholders, raising questions about the basis of their omission.
With national hotel occupancy rates reportedly stuck at around 35 percent, the Opposition has questioned whether the government has any plan, policy, or intent to provide targeted financial support to the struggling hotel sector, or whether hotel owners are expected to continue shouldering the burden alone.
Responding to these concerns, the Ministry of Industry, Commerce and Employment (MoICE) stated that while direct ESP loans were not extended to hotels, the government has prioritized indirect forms of support. These include the enhancement of tourism infrastructure, promotion of tourist market information, human resource and capacity development within the tourism sector, and airfare subsidies to encourage tourist inflow. MoICE also mentioned that loan deferment has been considered as part of relief measures for hoteliers.
While acknowledging these efforts, the Opposition stated that indirect interventions alone are insufficient given the sector’s continued financial distress. The Opposition recommended that the government review aspects of the current tourism policy to address issues, such as offshore manipulation of payments, which may be limiting revenue circulation within the country. It also called for the restructuring of existing loans for hoteliers through coordination with relevant financial institutions to ease mounting financial pressure.
Earlier this year, the Opposition Party wrote formally to the Ministry of Finance regarding public grievances related to the ESP concessional credit lines and non-performing loans (NPL). The letter, dated 3rd February 2025, outlined concerns that were gathered from consultation meetings, phone calls, and social media platforms. Among the issues raised were the lack of clarity among bank officials on policy directives, the requirement of multiple clearances causing delays, lengthy turnaround times for loan approvals, and the difficulty NPL clients face in obtaining bank guarantees.
In the letter, the Opposition requested information on the status of loan disbursement by Dzongkhag, the criteria and approval processes in place, measures taken to support NPL clients, and the specific policy directives issued to banks and relevant authorities. The party urged the ministry to respond promptly and address the concerns raised by affected members of the public.
