Guiding principles of the plan include inclusiveness of rural businesses, technological inclusiveness and integration of the Bhutanese private sector into the fourth industrial revolution
The Covid-19 pandemic left no country in the world affected including Bhutan economically. Business establishments were disrupted, and unemployment rose. The business sectors of Bhutan lost more than Nu 125.81bn in the past two years.
In order to revive the economy and assist the private sector, the Bhutan Chamber of Commerce and Industry (BCCI) is coming up with a recovery plan.
BCCI, President, Tandy Wangchuk said that the recovery action goals, plan and strategies of the Private Sector Recovery Plan (PSRP) 2022-2027, recommends a series of actions and initiatives by the BCCI and the business sector associations to minimize the hazards of the pandemic.
The PSRP proposes the goals and related initiatives such as saving businesses and minimizing impacts of Covid-19 through access to fiscal incentives and finances, fostering inclusiveness by using digital technologies with every adopting technological advancement, followed by fostering public-private partnerships and building globally competitive human capital in every sector.
The guiding principles of the PSRP for the next five years are inclusiveness of rural businesses, cottage and small businesses and youth and women in the private sector. The plan also emphasizes on technological inclusiveness of the private sector in order to integrate the Bhutanese private sector into the fourth industrial revolution and strengthen value and supply chains towards self-reliance.
The President of BCCI said PSRP proposes mobilization of funds through bank loans, crowd funding, angel investments, and venture capitals as access to finance is one of the main challenges confronted by business houses in the country.
“The government has put in several support measures including fiscal incentives to help business stay afloat,” said the President, adding that creating awareness of such programs and facilitating the application process will enhance business continuity and employee retention.
The PSRP initiative also includes using capital stock of private firms which are a large share for micro, small and medium business. The President shared that to address liquidity constraints, increase access to finance through other initiatives such as loan on stock for trading and manufacturing businesses and collateral free loan in partnership with Royal Monetary Authority’s (RMA)Kuen-Phen Financing will be initiated. New financial instruments such as blinded finance, amongst others, are included in PSRP.
Other initiatives in PSRP include promoting the use of e-Commerce more extensively for trade, collaboration with private financial institutions for efficient e-payment gateway systems to gain greater market access for tourism and the trading host of an annual Tech-Meet to promote investment, knowledge transfer, and network in order to accelerate FDI in the ICT sector, amongst others.
BCCI’s President said that in order to build a stronger domestic value chain, sector associations should collaborate with each other in various area, such as, joint commercialization, shared use of specialized equipment, and sharing of market intelligence will result in more efficient use of resources.”
“To fostering public-private partnerships, BCCI should lead the push for greater public-private partnerships across all sectors,” said the President, adding that leveraging private sector know-how, agility, and experience will benefit government projects.
The PSRP also includes partnership with agencies such as the Desuung Skilling Program with focus on matching trained and skilled persons with businesses for on-the-job training.
However, the President of the chamber said that the Bhutanese story is that of resilience and unity. “It is now time for the private sector of Bhutan to show that profit is not incidental to development but instead that development is necessary for profit.”
“The pandemic has exposed our vulnerabilities and shown us that we need to organize ourselves better and that we are capable to lead the way through our collective capacity,” said the President, adding that Bhutan must also have a stronger dialogue with the government so that all can work as partners together to rebuild and recover from the unexpected pandemic.
Tandy Wangchuk shared that the goal of the private sector is also not to return to pre-pandemic systems. “Our goal is to now make a new plan forward through inclusiveness, use of digital technology, public-private partnerships and developing a globally recognized human capital.”
To build stronger and a more resilient private sector, the President shared that beyond fiscal stimulus, government responses have to be broad. “Recovery packages need to go beyond the traditional fiscal expansions, they should include ‘Productive Development Policies’ also known as modern industrial policies.”
These policies are aimed at reducing coordination failures, facilitating the flow of information and providing key essential inputs.
“During the pre-pandemic days, the creation of formal jobs was insufficient to lower informality rates significantly. The recovery needs to incorporate solutions to the very large levels of informal employment; otherwise it will fail to make significant progress on the pressing issues of poverty and inequality,” he said.
Meanwhile, the plan presented by the chamber is being developed not only through calculations and data analytics but also through engagement with the private sector across the country over two months with an aim to encourage firms to operate, workers to return to their jobs, and motivate the consumers.
Sangay Rabten from Thimphu