THIMPHU // Saffron-robed monks wander the streets of Thimphu, where elaborately painted buildings feature lucky symbols like tigers and phalluses, all under the gaze of a huge gold Buddha atop a mountain overlooking Bhutan's tree-lined capital.
Premium-paying tourists have long eulogised Bhutan's unspoilt charms, its peace and its pristine environment, but the Himalayan kingdom, famed as the "last Shangri-La", and for using happiness to measure its success, is no idyll.
Its economy is struggling, with shantytowns emerging in urban centres, packs of wild dogs roaming freely, and beggars on street corners.
Bhutan, wedged between India and China, spends far more on imports than it earns, banks are cracking down on cheap credit after a recent debt-driven spending boom, and youth employment has surged to 9.2 per cent as teenagers abandon farming for urban life.
The government is trying to cut the number of people living below the poverty line to 15 per cent of the population from its current 23 per cent, according to its own figures.
Encouraging more tourists would bring in cash, but the government will not abandon its long-standing policy of limiting visitor numbers by accepting only those who pay $250 (Dh918) a day in advance.
"Bhutan will never be a mass destination," said Chhimmy Pem, head of marketing at the Tourism Council of Bhutan, formerly the Department of Tourism, which implements the government's tourism policy. "Our target will always be the high end visitors."
After paying for accommodation, travel, food and a guide, $65 of that $250 goes to the government. The policy was adopted to prevent tourism destroying Bhutan's unique Buddhist culture and traditions, but some politicians say protection from the outside world is no longer needed.
"Tourism was a real threat in the past, but that threat has gone," Tshering Tobgay, head of main opposition group, the People's Democratic Party, said. An increasingly consumerist Bhutanese society, he said, is changing regardless of the influence of sightseers. "It is us Bhutanese ourselves who are now putting our traditions and culture at risk."
Bhutan adopted a "high end, low volume" tourism policy when the reclusive nation first opened its borders to foreigners in 1974. That year just 300 visited.
In 2011, Bhutan welcomed around 64,000 people, according to figures released by the Tourism Council of Bhutan this month. By contrast, more than 600,000 people visited nearby Nepal in 2010, official Nepali figures showed.
In contrast to Nepal and India, where backpackers who live on a few dollars a day are welcomed, luxury resorts are more Bhutan's style.
Management consultancy firm McKinsey was commissioned by Bhutan to examine its economy, and recommended in 2009 that the country should attract 250,000 tourists by 2014.
The government decided this target was too ambitious, and instead wants to bring in 100,000 a year by the end of 2012.
Combined with visitor spending on extra services and handicrafts, the Tourism Council estimated the industry contributed nearly 10 per cent of GDP in 2011, making it Bhutan's second biggest earner. Power exports, mainly to India, account for 40 per cent of national revenue, and a quarter of GDP, according to the Asian Development Bank.
Sonam Dorji, secretary-general of the Association of Bhutanese Tour Operators, said early fears over the culturally and environmentally destructive effects of tourism had faded, but concerns over numbers had not.
"The tourists who come here are well travelled, and cultural tourism is their major interest, so they travel to the villages to see local festivals and stay in traditional homestays," he said. "This brings money to local economies and supports these traditions which could die out otherwise."
About 70 per cent of Bhutan's 700,000 population survives through subsistence farming. Electricity and roads are yet to reach all of the country, and the latest Gross National Happiness survey, conducted in 2010, found only 41 per cent of Bhutanese were classified as "happy".
In an interview in May, prime minister Jigmi Thinley said Bhutan could not cope with the recent phenomenon of debt-fuelled consumerism which has outstripped economic output, forcing the government to cut spending and consider raising some taxes.
But Bhutan is a country in transition. The younger generation is abandoning traditional dress in favour of jeans, T-shirts and tattoos, and most young Bhutanese are on Facebook.
It is a major shift for a nation that only allowed television and internet access in 1999, and still bans the sale of tobacco.
This is the where the tension lies: tourists, so important to the economy, enjoy the exclusivity of Bhutan, and they fear that if the pace of progress increases, they may find the very things that draw them there are jeopardised.
"There are no queues here and tourism has not left a mark," said American tourist Jennifer Logsdon, a human resources executive from Boston who was enjoying Bhutan's ancient monasteries and fortresses dotted across the country.
The Farewell
Director: Lulu Wang
Stars: Awkwafina, Zhao Shuzhen, Diana Lin, Tzi Ma
Four stars
COMPANY PROFILE
Name: Kumulus Water
Started: 2021
Founders: Iheb Triki and Mohamed Ali Abid
Based: Tunisia
Sector: Water technology
Number of staff: 22
Investment raised: $4 million
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
The years Ramadan fell in May
COMPANY%20PROFILE
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The%20new%20Turing%20Test
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How it works
1) The liquid nanoclay is a mixture of water and clay that aims to convert desert land to fertile ground
2) Instead of water draining straight through the sand, it apparently helps the soil retain water
3) One application is said to last five years
4) The cost of treatment per hectare (2.4 acres) of desert varies from $7,000 to $10,000 per hectare
How to apply for a drone permit
- Individuals must register on UAE Drone app or website using their UAE Pass
- Add all their personal details, including name, nationality, passport number, Emiratis ID, email and phone number
- Upload the training certificate from a centre accredited by the GCAA
- Submit their request
What are the regulations?
- Fly it within visual line of sight
- Never over populated areas
- Ensure maximum flying height of 400 feet (122 metres) above ground level is not crossed
- Users must avoid flying over restricted areas listed on the UAE Drone app
- Only fly the drone during the day, and never at night
- Should have a live feed of the drone flight
- Drones must weigh 5 kg or less
'Gold'
Director:Anthony Hayes
Stars:Zaf Efron, Anthony Hayes
Rating:3/5
Command%20Z
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MATCH INFO
Euro 2020 qualifier
Fixture: Liechtenstein v Italy, Tuesday, 10.45pm (UAE)
TV: Match is shown on BeIN Sports
THE LIGHT
Director: Tom Tykwer
Starring: Tala Al Deen, Nicolette Krebitz, Lars Eidinger
Rating: 3/5
A MINECRAFT MOVIE
Director: Jared Hess
Starring: Jack Black, Jennifer Coolidge, Jason Momoa
Rating: 3/5
The National's picks
4.35pm: Tilal Al Khalediah
5.10pm: Continous
5.45pm: Raging Torrent
6.20pm: West Acre
7pm: Flood Zone
7.40pm: Straight No Chaser
8.15pm: Romantic Warrior
8.50pm: Calandogan
9.30pm: Forever Young
Poacher
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THE%20HOLDOVERS
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The specs
Engine: 3.8-litre twin-turbo flat-six
Power: 650hp at 6,750rpm
Torque: 800Nm from 2,500-4,000rpm
Transmission: 8-speed dual-clutch auto
Fuel consumption: 11.12L/100km
Price: From Dh796,600
On sale: now
NO OTHER LAND
Director: Basel Adra, Yuval Abraham, Rachel Szor, Hamdan Ballal
Stars: Basel Adra, Yuval Abraham
Rating: 3.5/5
Greatest of All Time
Starring: Vijay, Sneha, Prashanth, Prabhu Deva, Mohan
Our family matters legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
