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Bhutan

Has Bhutan’s growth been jobless?

Tenzin Lhaden's picture
Bhutan's youth unemployment rate has increased from 10.7 percent in 2015 to 13.2 percent in 2016
Bhutan continues to maintain solid growth and macroeconomic stability but job creation is lagging; its  youth unemployment rate has increased from 10.7 percent in 2015 to 13.2 percent in 2016. This indicates that high growth has not been able to generate enough jobs for youth. 

“The main driver of growth in Bhutan continues to be the hydropower sector, but electricity generation does not create job,” said a senior government officials attending the presentation of The World Bank’s South Asia Focus on Jobless Growth on June 28th in Thimphu. The report was presented by Martin Rama, World Bank South Asia Region Chief Economist and was attended by senior government officials, parliamentarians and development partners. The presentation alongside the launch of Bhutan Development Update was a great opportunity for the policy makers to better understand and synthesize Bhutan and the South Asia region’s development opportunities.

In the case of Bhutan, it seems clear that growth alone will not allow it to attain higher employment rates as enjoyed by some other developing countries.

"More than 1.8 million young people will reach working age every month in South Asia through 2025 and the good news is that economic growth is creating jobs in the region,” said Martin Rama,. “But providing opportunities to these young entrants while attracting more women into the labor market will require generating even more jobs for every point of economic growth.”

The report informs that the fall in employment rates has been much faster in the region particularly in India, Bhutan and Sri Lanka and especially for women, risking foregoing the demographic dividend. While it is evident that the number of working age people is increasing, the proporation who are at work has declined owing to prioritization of the households to education, health and other commitments with increasing level of income.

How to boost female employment in South Asia

Martin Rama's picture
What's driving female employment in South Asia to decrease


South Asia is booming. In 2018, GDP growth for the region as a whole is expected to accelerate to 6.9 percent, making it the fastest growing region in the world. However, fast GDP growth has not translated into fast employment growth. In fact, employment rates have declined across the region, with women accounting for most of this decline.

Between 2005 and 2015, female employment rates declined by 5 percent per year in India, 3 percent per year in Bhutan, and 1 percent per year in Sri Lanka. While it is not surprising for female employment rates to decline with economic growth and then increase, in what is commonly known as the U-shaped female labor force function (a term coined by Claudia Goldin in 1995), the trends observed in South Asia stand out. Not only has female employment declined much more than could have been anticipated, it is likely to decline further as countries such as India continue to grow and urbanize.

The unusual trend for female employment rates in South Asia is clear from Figure 1. While male employment rates in South Asia are in line with those of other countries at the same income level, female employment rates are well below.
From the South Asia Economic Focus
Source: South Asia Economic Focus (Spring 2018).

If women are choosing to exit the labor force as family incomes rise, should policymakers worry? There are at least three reasons why the drop in female employment rates may have important social costs. First, household choices may not necessarily match women’s preferences. Those preferences reflect the influence of ideas and norms about what is women’s work and men’s work as well as other gendered notions such as the idea that women should take care of the children and housework. Second, when women control a greater share of household incomes, children are healthier and do better in school. Third, when women work for pay, they have a greater voice in their households, in their communities, and in society. The economic gains from women participating equally in the labor market are sizable: A recent study estimated that the overall gain in GDP to South Asia from closing gender gaps in employment and entrepreneurship would be close to 25 percent.

It’s time to end malnutrition in South Asia

Idah Z. Pswarayi-Riddihough's picture
Chronic malnutrition remains prevalent across the region as many poor South Asians cannot afford nutritious foods or don’t have the relevant information or education to make smart dietary choices.
Chronic malnutrition remains prevalent across South Asia as many poor South Asians cannot afford nutritious foods or don’t have the relevant information or education to make smart dietary choices.

In Sri Lanka, as in the rest of South Asia, improving agricultural production has long been a priority to achieve food security. 

But growing more crops has hardly lessened the plight of malnutrition. 

Chronic malnutrition remains prevalent across the region as many poor South Asians cannot afford nutritious foods or don’t have the relevant information or education to make smart dietary choices. 
And children and the poorest are particularly at risk.

South Asia is home to about 62 million of the world’s 155 million children considered as stunted-- or too short for their age. 

And more than half of the world’s 52 million children identified as wasted—or too thin for their height—live in South Asia. 

Moderate-to-severe stunting rates ranged from 17 percent in Sri Lanka in 2016 to a high 45 percent in Pakistan in 2012–13, with rates above 30 percent for most countries in the region.

Moderate-to-severe wasting rates ranged from 2 percent in Bhutan in 2015 to 21 percent in India in 2015–16, with rates above 10 percent for most countries in the region. 

The social and economic cost of malnutrition is substantial, linked to impaired cognitive development, chronic disease, and lower future earnings.

And sadly, much remains to be done to ensure children across South Asia can access the nutritious foods they need to live healthy lives. 

From Japan to Bhutan: Improving the resilience of cultural heritage sites

Barbara Minguez Garcia's picture
This page in: 日本語
 Barbara Minguez Garcia 2018
When it comes to their heritage buildings, both Bhutan and Japan have one common enemy: Fire. A view of Wangduephodrang Dzong in Bhutan which was destroyed by fire in 2012. Credit: Barbara Minguez Garcia 2018

About 2,749 miles, three countries, and a sea separate Kyoto, Japan, and Thimphu, Bhutan. The countries’ languages are different, and so are their histories.

But when it comes to their heritage buildings, both nations have one common enemy: Fire.

And to help prevent fire hazards, there’s a lot Bhutan can learn from Japan’s experience.

To that end, a Bhutanese delegation visited Tokyo and Kyoto last year to attend the Resilient Cultural Heritage and Tourism Technical Deep Dive to learn best practices on risk preparedness and mitigation, and apply them to Bhutan’s context.

Such knowledge is critical as Bhutan’s communities live in and around great heritage sites.

Helping Bhutan’s parliamentarians better understand economics

Yoichiro Ishihara's picture
Bhutanese Council Members and World Bank Staff
Bhutan's newly elected council members with World Bank staff. 

Members of parliament are valuable partners for the World Bank. They enact laws, shape and review development policies, and hold governments accountable for World Bank-financed programs. This applies for the landlocked Himalayan kingdom of  Bhutan. The role of its parliament has been increasing since the country’s successful transition from monarchy to constitutional monarchy in 2008. Through its engagement with these elected representatives, the World Bank effectively integrates citizen voice in its programs to achieve lasting and inclusive development results.
 
A joint workshop between the World Bank and National Council of Bhutan, the upper house, was a great opportunity for the World Bank to engage with the 25 newly elected National Council members.

Promoting better nutrition in Bhutan

Izabela Leao's picture
 Izabela Leao / World Bank
School children singing and dancing in Samtse Dzongkhag. Photo Credit: Izabela Leao / World Bank

Bhutan is no ordinary place.

A landlocked Himalayan kingdom tucked in a mostly rugged mountainous terrain between India and China, it measures prosperity by assessing its citizens’ level of happiness by way of a Gross National Happiness index.

Equally striking, Bhutan’s constitution mandates that 60 percent of its national land be preserved under forest cover, making Bhutan the world’s only carbon-negative country.

Bhutan’s geography – with land rises ranging from 200 meters in the southern foothills to 7,000 meters in the high northern mountains – consists of three major agro-ecological zones that allow for a rich biodiversity and seasonal foods.

This natural wealth, however, comes with its caveats as Bhutanese living in isolated rural areas can’t access a reliable diverse diet throughout the year.

"Many families in rural Bhutan practice two meals rather than three meals a day," reports Ms. Kinley Bidha, Tarayana Foundation Field Officer in Samtse Dzongkhag. "Some for cultural reasons, others due to a shortage of food, others due to a shortage of land too farm," she adds.

Overall socio-economic development in the last three decades has led to a rapid improvement in health and nutrition outcomes in Bhutan – the country’s infant mortality rate declined to 30 per 1,000 live births in 2012 down from 90 per 1,000 in 1990; while the rate of stunting in children under 5 years declined 24 percent from 1986 levels.

Nonetheless, the lack of variety of foods in diet remains a key concern, especially for pregnant and nursing women as well as young children. And while most families feed their children complementary food, fewer than a quarter of parents provide them nutritious meals essential to their health.

In addition, 67 percent of Bhutanese adults consume less than the recommended five servings (or 400 grams) of fruits and/or vegetables per person a day [National Nutrition Survey (NNS) 2015].

When consumed, vegetables consist for the most part of two national staples, potatoes and chilies, which hardly provide essential vitamins and minerals.

Keeping regional variations in mind, between 16 and 34 percent of children under 5 are stunted—or too short for their age—seven percent of children are underweight, 35 percent of children of age 6-59 months and 44 percent of women of reproductive age are either anemic or iron deficient. Exclusive breastfeeding rates for six-month-old children remain at a low 50 percent (NNS, 2015).  

Damages caused by malnutrition during pregnancy and the first years of a child’s life are irreversible and contribute to stunting and lower immunological and cognitive development, and predispose to adult-onset diseases (including metabolic syndrome).

Thankfully, the negative impact of malnutrition on Bhutan’s economy is now better understood and has become a priority to promote its national development.

Encouraging more women to take part in regional trade

Mandakini Kaul's picture

Across South Asia, women represent a hugely underutilized source of growth. In fact, the South Asia region has some of the world’s lowest rates of female labor force participation - only 36%. Even where women work, they are mostly confined to less-remunerative low-skill jobs, and remain excluded from most trading activity. To make it easier for more women to work in all fields of endeavor, World Bank projects in the region have begun to look at development projects through a more gender-focused perspective.
 
One such area is regional trade and connectivity. After a long hiatus, the political momentum for cooperation within the eastern region is growing, especially in the Bangladesh Bhutan India Nepal (BBIN) corridor.  The Indian government’s Act East Policy, combined with the new Motor Vehicles Act that allows vehicles to cross the BBIN border with ease, represent a unique opportunity to reimagine inclusive growth by enabling more of the region’s women to benefit from this corridor.
 


Accordingly, the South Asia Regional Trade Facilitation Program (SARTFP), an Australian government-funded program being implemented by the World Bank, seeks to improve the conditions for women to trade between these nations and to create more remunerative livelihoods.

Regional cooperation in conservation: South Asia shows the way

Andrew Zakharenka's picture
Illegal trade in wildlife and conservation often were not considered high priority for countries of the South Asia Region. In the first ever attempt, the governments of Bangladesh, Nepal, and Bhutan joined forces to strengthen regional cooperation for wildlife conservation. And it was a successful one.

The regional project assisted the governments in building and enhancing shared capacity and institutions to tackle illegal wildlife trade across their borders and invest in habitat and wildlife conservation of critically endangered species. It was clear from the onset that these issues would require both national leadership and regional coordination.
 
Launched in 2011, the project initially had a delayed start. Yet, by December 2016, when the project ended, it became clear that governments coordinated efforts successfully. The three countries participated in regular joint action planning and practice-sharing meetings, signed protocols for and cooperated in transboundary actions, as well as held consultations and public events at the local, national, and international levels.
 
The project supported conservation programs of dozens of endangered species, including crocodiles being released here into the wild. Sundarban area, 2014

Voices of Youth: A Hope for One South Asia from Young Economists at Students' Meet

Nikita Singla's picture
Young economists from South Asia at South Asia Economics Students’ Meet (SAESM) 2018, Chittagong, Bangladesh
Young economists from South Asia at South Asia Economics Students’ Meet (SAESM) 2018, Chittagong, Bangladesh
Photo Credits: Nikita Singla/World Bank

At the 14th South Asia Economic Students’ Meet (SAESM), more than 100 top economics undergraduates and faculties from seven countries in South Asia convened in Chittagong, Bangladesh to discuss how greater regional integration in South Asia can help countries achieve the Sustainable Development Goals (SDGs). As these young economists engaged in vigorous academic competitions and research presentations on South Asia’s development opportunities, they also created fond memories and built lifelong friendships. Was SAESM 2018 a new hope for #onesouthasia? Let’s hear it from the students themselves.

“With the momentum built up, the stage set, with a banner that in all its glory was decorated with the flags of the seven South Asian states, we sat in our respective country groups to embark on a three-day long journey that was to change my perception of South Asia forever. The dis-embarkment on this passage saw us divided by geographical boundaries, as India and Pakistan made sure to sit the farthest away from each other. The end to this voyage, however, painted a story not many foresaw – twenty Indians and Pakistanis crammed together in a single bus, discussing our common history with a fondness anew to most, accompanied by bursts of people from either side breaking into rounds of Antakshari. At that point, we were one!" – Alizeh Arif, Lahore School of Economics

Moving towards gender equality in Bhutan

Tenzin Lhaden's picture
Accompanying rapid economic development, Bhutan has greatly reduced gaps in gender equality.
Photo Caption: Sonam 'Sherlock' Phuntsho/World Bank

“…never did I imagine that I would live to see this day, when a woman would be serving at this level,” said my 86-year-old grandmother with her eyes beaming while watching the inauguration ceremony of the first female Minister of Bhutan.

Bhutan is a small country nestled in the eastern Himalayas between China and India, has managed to maintain its rich and unique cultural heritage in this modern-day age, partly due to its relative isolation during much of the last century. Bhutan is one of the smallest but fastest-growing economies in the world and a success story in poverty reduction.

Accompanying rapid economic development, Bhutan has greatly reduced gaps in gender equality. The net primary enrolment rate, that is the percentage of children attending school in 2016 was 98.8% for girls compared to 97% for boys. There has also been an increasing representation of girls at the higher secondary level although the lag continues at the university level.

Gender gaps in labor markets and job quality was identified as one of the main areas of gender gaps in the 2013 World Bank Gender Note Policy. Although tremendous progress has been made, - 58% of Bhutanese women working for pay or looking for jobs - the female labor force participation saw a slight decline compared to men in 2016. It remains one of the highest in the region[1].


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