Economic growth goes downturn
November 06 2009: In the last few years, UN reports had maintained that Bhutan achieved around 21 percent growth in Gross Domestic Product (GDP). However, last year the country achieved only 5 percent growth. The ruling party had targeted for 9 percent.
In 2008, the country went through negative growth in construction industry – 6.4 percent, thus bringing down the average rate. Forestry incomes decreased by 2.6 percent while trade, mining, transport and communication and education and health services also showed poor performances.
For achieving ruling party’s target to reduce poverty to 15 percent by 2013, the country requires average GDP growth rate of 9 percent annually. The total GDP grew from Nu 36.1 billion in 2007 to Nu 37.9 billion in 2008.
Global food crisis, economic recession and record rise in POL prices pulled up the inflation as high was 9.2 percent to which government cite as cause for fall in GDP growth rate.
Increasing number of tourist, though declined in some major Buddhist festivals, posted good performance of the tourism industry. Finance and banking sector grew slightly. Agriculture has performed the same as in 2007 while livestock has improved.
Entertainment, sports and other recreational sector grew by 2.5 percent compared to 6.9 percent in 2007.
The current expenditure has gone up, while investment in service sectors like public education and heath decreased to 3.1 percent in 2008 compared 10.3 percent in 2007. The government’s overall services lower this year at 3.1 percent compared to 3.2 percent in 2007.
Per capita income has increased to US$ 1852 compared to US$ 1321 in 2006.
In manufacturing industry such as cement, wood and agricultural inputs observed negative growth rates.
National Bureau of Statistics projects 7 to 8 percent growth rate for 2009.