Bhutan, with a population of 782,455, is ranked 156th globally, just behind Guyana. Located in South Asia, it covers 38,390 sq. km, ranking 127th worldwide, following Switzerland.
In 2022, Bhutan’s economy is positioned with a GDP of $2,707,000,000, ranking 166th globally. It follows Belize, with a GDP of $2,830,507,575.6841. Bhutan’s GDP per capita stands at $3,144, placing it at 132nd in the world. It lags behind Vanuatu, with a GDP per capita of $3,231.3513.
Despite its modest size, Bhutan’s economy is steadily growing, driven by sectors such as hydropower, tourism, and agriculture, contributing to the country’s overall economic stability and development.
What are the economic activities of Bhutan?
- Primary activities: 16.2% of GDP.
- Secondary activities: 41.8% of GDP.
- Tertiary activities: 42% of GDP.
Primary Sector of Bhutan
Bhutan’s primary sector heavily relies on agriculture due to its favorable climate and abundant natural resources. With 13.45% of the country’s land dedicated to agriculture, Bhutan produces a diverse range of products including milk, rice, root vegetables, potatoes, maize, oranges, areca nuts, chilies/peppers, pumpkins/squash, and bison milk.
Despite agriculture contributing 16.2% to the GDP, its significance lies in the variety of crops and animal products that sustain the country’s agricultural sector. The sector’s resilience is evident through the production of staple foods and cash crops, showcasing the importance of agriculture in Bhutan’s economy.
With a diverse geological landscape, the primary sector thrives on abundant natural resources. Timber, hydropower, gypsum, and calcium carbonate play a pivotal role in the economy, driving growth and sustainability.
Secondary Sector of Bhutan
What is the secondary sector or what are secondary activities?
The secondary sector includes industries that transform raw materials into finished products for consumption. In Bhutan, main industrial products are cement, wood products, processed fruits, alcoholic beverages, and calcium carbide. These products are manufactured for domestic consumption and export, contributing to the country’s economy and industrial growth.
In 2023, Bhutan’s total exports are dominated by sectors other than manufacturing, indicating that the contribution of manufactures to the country’s export revenue is relatively insignificant.
Tertiary sector of Bhutan
What is the tertiary sector or what are tertiary activities?
The tertiary sector in Bhutan encompasses services that provide knowledge and time to enhance productivity and meet needs. Key activities include healthcare, education, banking, tourism, transportation, telecommunications, and security services. These sectors contribute significantly to Bhutan’s economy by offering intangible goods like expertise and assistance.
In particular, Bhutan’s tourism industry, with only 316,000 annual arrivals and a tourist-to-population ratio of 0.4039, plays a relatively minor role in the country’s economy. Despite its picturesque landscapes and cultural attractions, the sector’s contribution remains limited when compared to other economic drivers.
Another example of tertiary economic activity is the mobile cellular economic sector, which boasts around 742,000 subscriptions, equating to 95 per 100 inhabitants. This connectivity fosters technological growth, enabling innovation and digital services.
International Trade of Bhutan
Import Activities of Bhutan
Bhutan’s import activities are of high importance, accounting for 49.87% of its GDP, totaling $1.35 billion in 2023.
Bhutan’s major import partners are India, accounting for 75% of its imports, followed by China at 12%. The country imports computers, refined petroleum, electrical machinery, coke, and wood charcoal mainly from these partners. Other significant import partners include Indonesia, Thailand, and Singapore.
Exports Activities of Bhutan
Bhutan’s export activities in 2023 totaled $392 million, accounting for 14.48% of its GDP. With a medium level of importance, exports play a significant role in Bhutan’s economy, contributing to its growth and stability.
Bhutan’s export activities are primarily focused on iron alloys, dolomite, gypsum, cement, and electricity. The country’s top export partner is India, accounting for 88% of its exports, followed by Italy at 5%, Nepal and Colombia at 2% each, and Singapore at 1%.
Bhutan economy challenges in 2024
Bhutan continues to thrive in 2024 with hydropower investments driving economic growth. Challenges include climate vulnerabilities and maintaining strong ties with India amidst global uncertainties.
Leave a Reply