HOTEL Zhiwaling and Yangphel Adventure Travel, both part of the Yongphel group of companies, became the inaugural private enterprises in Bhutan to adopt the national philosophy of Gross National Happiness (GNH), when they launched in 2011 a three-year programme to integrate sustainable business practices into their operations.

Karma Lotey, the CEO of the Yangphel group of companies said: “The firm has been adhering to the principles of GNH for some time, but we thought it was finally time to formalise our processes.”

During the first phase of implementation, Hotel Zhiwaling and Yangphel set out to raise understanding among employees of the nine key components of GNH, and how its values could be integrated into the business. Workshops on waste management and environmental monitoring were conducted for staff members.

Isabel Sebastian, a sustainable tourism consultant drafted in to develop Yangphel’s GNH-based practices and business structure, said: “This exercise enabled both players to engineer benchmarks and indicators for the Bhutanese tourism sector. Now, there is a basis and reference point for companies in Bhutan to integrate the concept of GNH to achieve lower electricity consumption and carbon emissions while reducing waste.”

“What’s amazing was that the success of the first year, including a reduction in carbon emissions, was attained solely through behavioural changes (of employees),” Sebastian added.

A statement by Hotel Zhiwaling revealed that emissions per guest per night declined by 13 per cent in 2011 over the year before, after a waste segregation and recycling system was introduced as part of its GNH efforts.

Also commiting to its GNH philosophy, Yangphel launched a competition for its trekking crew, awarding a prize to those who collected the largest amount of waste along trekking routes for recycling. Responsible trekking and minimum impact guidelines were established and introduced in July 2011.

Subject to further funding from the Bhutanese government, the second phase of implemenation will take place in 2012, with the focus on educating owners and shareholders about the concept of sufficiency.

Sebastian explained: “Essentially, we want owners and shareholders to agree and declare a satisfactory profit level, and develop steps that will enable the organisation to transfer benefits to as many people as possible.”

DESPITE concrete moves to expand its tourism product offerings and seasonality (TTG Asia e-Daily, February 6, 2012), Bhutan is contemplating raising its minimum daily tariff to US$300 or more within the next four to five years, to restrict the profile of targeted source markets to a select few.

Levied on non-Indian foreign visitors, high season (March-May, September-November) tariffs were raised from US$200 to US$250 per person per night beginning this year. Low season tariffs remain at US$200 per person per night.

Speaking to TTG Asia e-Daily on the sidelines of the PATA Adventure Travel & Responsible Tourism Conference and Mart 2012, Kesang Wangdi, director general Tourism Council of Bhutan, said: “It is imperative for Bhutan to be a high-end destination. We want to concentrate on creating sustainable value and benefits for Bhutan in the long term, rather than pander to mass tourism in the short term.”

“We want to attract visitors for whom price is not the main criteria when selecting a holiday. Bhutan is an exclusive destination for a certain type of tourist with a particular mindset,” he added.

Anthony Wong, group managing director of Malaysia’s Asian Overland Services Tours & Travel, said: “Bhutan is right to consider increasing its tariff as it will protect local businesses, stemming the flow of revenue exiting the country. Bhutan is a gem and an exclusive destination, and people should understand that coming here is a privilege.”

Wong emphasised that Bhutan should explain clearly that the tariff encompasses a royalty fee used to fund the country’s health and education sectors. “If this were highlighted to consumers, a fee hike would have less of a detrimental impact on demand,” he said.

Buyers such as Hannah Methven, product manager for UK-based Explore Worldwide, and Jenny Campbell from South Africa’s Travel Experts said the lower end of the market would probably think twice about heading to Bhutan if tariffs were raised.

“Some clients might choose to go to Nepal or Tibet, which are not as expensive. Only fairly affluent FITs or the well-travelled will continue to choose Bhutan,’ said Campbell.

Tshewang Om, operations manager of Thimpu-based Om Travenza, said: “If the tariff was increased, from a business standpoint, this would make Bhutan harder to sell. However, it would be good for the environment and overall wellbeing.”

Sonam Wangmo, founder of Bhutan’s Yu Druk Tours and Treks, said: “It is more critical to ensure that we put measures in place to manage numbers and capacity, rather than just think of the bottom line.”

BHUTAN, where the annual tourism season runs for only five and a half months each year, is looking to transform itself into a year-round destination through a series of product, marketing and infrastructural developments.

According to Kesang Wangdi, director general Tourism Council of Bhutan, hotel occupancy rates range from 10-30 per cent throughout the year, while tourism-related activities mostly take place in the capital Thimpu or nearby Paro, making it difficult for businesses dependent on tourism to survive.

Hence, the government is making moves to expand the country’s tourism product portfolio, both geographically and categorically, with the aim of “distributing the benefits obtained from… tourism, throughout the calendar year and to tourism deficient areas… particularly in the rural south and east of Bhutan”, said Wangdi.

A host of niche products covering cultural, festival, wellness, spiritual and MICE tourism is under development in various regions, while a route that links with Buddhist sites in neighbouring nations, as well as a joint destination marketing campaign together with Thailand are in the works.

To meet the projected increase in arrivals, the government is also incentivising developers to build infrastructure outside the main cities of Thimpu and Paro.

“To encourage hotel development, we permit 100 per cent foreign ownership if developers construct hotels of a five-star calibre. Moreover, all foreign firms will be treated as Bhutanese entities – they are equal before the law,” said Wangdi.

However, before any private sector plans are implemented, they are subject to evaluation against the country’s gross national happiness (GNH) masterplan benchmarks, he cautioned. “In order for plans to be approved, developers will have to ensure that their projects adhere to the nine pillars set out in Bhutan’s GNH philosophy.”

Meanwhile, with an expected increase in arrivals from 30,000 presently to 100,000 per year by 2013, the Tourism Council of Bhutan is thinking of raising the daily tourist tariff, currently upwards of US$200, to over US$300, in a bid to boost tourism coffers and improve yields for Bhutanese operators and hoteliers.

The government royalty component of US$65 per day, used to fund health and education efforts, could also increase in the medium term if numbers entering Bhutan grow too quickly, said Wangdi.