Bhutan has an enviable reputation for « premium version of the Himalayas. Gorgeous mountains, deeply traditional Buddhist culture, clean air — all this could be obtained for a standard daily fee, which forms the basis of the Bhutanese tourism model.
Until recently, this was a price that discerning tourists were happy to pay. For a daily flat rate of $200–250 per person before the pandemic, visitors got access to one of the most unspoilt parts of the Himalayas — to an impeccable Buddhist kingdom, which is considered the closest to Shangri-La on Earth.
And now Bhutan is radically changing its tourism model — instead of paying $200–250 USD per night for an all inclusive package; tourists will now be charged a daily “sustainability fee” $200 with additional costs for food, lodging, transportation and everything else that used to be part of the package.
Visitors will no longer need to join an organized tour, but trips to Bhutan have just become much more expensive .
How did the old daily fee structure work in Bhutan?
In the pre-pandemic world, visitors to Bhutan paid $250 per person per day to stay in the country. You could pay less, but in the low season. From December to February and from June to August the daily fee was reduced to $200 — when the weather is either too cold or too cloudy.
Daily fee $250 e., set by the Bhutan Tourism Board, was in fact a fixed minimum fee for a full all-inclusive package, including: accommodation, meals, transportation, visits to monasteries, shrines and museums, as well as the services of an experienced guide. In the world of Bhutanese all inclusive tourism was actually super value.
By paying this fixed amount, visitors were free to plan their itinerary with a Bhutanese travel agency, bringing together legendary attractions such as the medieval dzongs (fortified monasteries) in Paro, Thimphu and Punakha and Tiger's Nest Monastery in Taktshang, which can be reached in half a day on a trail north of Paro.
A typical trip included visits to monasteries, hiking, admiring mountain scenery, archery tournaments, wildlife watching, a daily serving of ema datse (chili stew with cheese) and other Bhutanese delicacies, usually served with additional dried chili peppers. for garnish.
The daily fee model was based on a $65 per day sustainability fee that went directly to the government of Bhutan to fund projects ranging from public education to conservation, carbon neutral infrastructure and organic farming. These measures contributed to Bhutan becoming the first carbon-negative country on earth in 2017, actually absorbing more carbon dioxide than it produces.
This model has paid dividends to the Bhutanese treasury. In 2019, the last year before the pandemic, Bhutan hosted 315,599 high-end tourists, contributing $345.88 million to the national coffers.
Bhutan has managed to keep 71% of its territory under forest cover, compared to just 25% in Nepal and 11% in Bangladesh, and about 95% of Bhutan's electricity is produced using hydropower.
Almost 100% of the population has access to electricity and clean water.
When September 23, 2022 Bhutan reopens to quarantine-free tourism, the sustainability fee will increase from $65 to $200 per day for most visitors, resulting in to even more income for Bhutan's development projects.
The government has already confirmed that the increased development fees will be used to offset the carbon footprint of tourism, improve carbon-neutral infrastructure and enhance the skills of workers in Bhutan's tourism sector, supporting Bhutan's recovery from the Covid-19 pandemic.
There is, perhaps , one “but”. 73% of visitors to Bhutan are tourists from neighboring India, Bangladesh and the Maldives, and they have been exempted from both sustainability fees and the need to participate in organized tours. And the common land border only contributed to this.
Actually, tourist fees — this is the future of travel: Thailand introduced a $9 tourist tax in 2022, Venice is ready to charge a €10 entrance fee from 2023, and there are already many tourist taxes and fees in place across the EU.
New the model can also help bridge the small but tangible gap between locals and tourists who are accompanied on organized tours.