Address by the Honorable Prime Minister of Bhutan His Excellency Lyonchhen (Dr.) Lotay Tshering at the Inaugural Session of the 14^th Round Table Meeting

12^thMarch 2019

Before beginning my talk, let us all take a moment to remember the 157 lives from over 35 countries lost during the air crash of the Ethiopian Airlines on 10 March.

Your Excellency Mr. Achim Steiner,

Excellences,

Distinguished Delegates,

Ladies and Gentlemen.

Kuzungpola.

A very good evening to you all; at the very beginning, I have the great privilege of conveying to you the greetings of His Majesty the King. I was commanded to convey His best wishes to all delegates and to make sure that your visit is a wholesome one; so please do let us know if you want us to arrange anything differently.

It is my honor to welcome all our distinguished guests to Bhutan. We are most grateful for your time and commitment.

I would like to extend a special welcome to His Excellency, Mr. Achim Steiner, Under Secretary General of the United Nations and UNDP Administrator, on your first visit to our country.

We are most happy to have you with us and thank you for consenting to co-chair the RTM with our Foreign Minister.

Your presence here today speaks to the importance of our good relations with the United Nations and the global community. Thank you very much, Your Excellency.

In this regard, I wish to acknowledge with gratitude the kind support of the United Nations System in Bhutan in organizing this RTM.

Excellences, Distinguished Delegates, Ladies and Gentlemen.

GNH-guided development

As you are aware, Bhutan has decided to pursue its Gross National Happiness (GNH) development philosophy seriously, knowing that rapid economic development and material wealth will not give what we all want in our lives that is Happiness.

This philosophy of GNH and the wisdom of our selfless Monarchs have long guided Bhutan along a development path that is holistic, inclusive, sustainable and responsible.What our Monarchs calls it “development with values”.

Guided by GNH, we have strong institutions that support good governance at the national and local levels. Bhutan today enjoys well-balanced, good social and economic development with pristine environment. Our sense of community remains strong, and our quality of life is enriched by our vibrant culture.

Excellences, Distinguished Delegates, Ladies and Gentlemen.

With our limited resources, in last few decades, Bhutan has performed wellin the social sectors:

• Our life expectancy today is close to 70 years (compared to about 61 years in 2000).
• General literacy rate is over 71 percent (compared to 52.8 percent in 2005).
• Income povertyhas been greatly reduced—from close to 32% in 2003 to about 8% in just a decade. Multi-dimensional povertyhas also decreased from 12.4 % to 5.4 % today over last 6 years
• Similarly, despite our small economy, our GDP has tripled over last 10 years. Road infrastructure and telecommunications have expanded
• Health care indices like infant mortality, Maternal mortality, immunization coverage and access to safe drinking water have all improved significantly.
• All with your generous support; Bhutan’s success is our shared success.

I must take thisexcellent opportunity to thank all our development partners for your generous support and cooperation. Without your support, we would not have reached where we are today. Thank you, my dear friends.

But despite our many successes, we still have much to do. We need to reach the unreached, and ensure that no one is left behind, as echoed in the SDGs [Sustainable Development goals].

In this regard, please allow me to briefly outline some of the key challenges and strategies that we are looking at during the 12^thFive Year Plan (FYP).

This plan will be the last plan to be implemented as a LDC. With all your generous support, we are set to graduate from LDC by 2023. But a deeper dive into this transition is making me more worried! We really have to be Strategic during this last-mile ride, because we consistently qualified only with the social indices and never on the economic vulnerability front. By this, we risk being a very poor country behaving like a rich one!

We will make targeted interventions to uplift our poor and keep the vulnerable out of poverty. We will strive to ensure that every poor household has the necessary opportunities for livelihood and employment. This will include access to credit, renewed focus on Agriculture, Private Sector development, universal health coverage and inclusive and relevant education for all.
We will work to ensure consistent supply of safe drinking water, and that all our people have access to proper sanitation facilities. We will review the Housing Policy (2002) to improve access to affordable housing.

Without these basic needs, transition from LDC will be meaningless.

A must progress along with her people.

We are proud with the success of our primary health care. We are doing very well with our primary health care system; so now, we pledge to bring secondary health care to community level and make all facilities of tertiary health care available in the country which currently is referred to India at the expense of the government. Our state provides 100% free health care to all Bhutanese but allots less then 3% of our National budget to health; this clearly questions the quality of our health care. So, we are looking into enhancing our healthcare system too.

We are now providing free basic educationup to the 12^thstandard from this academic session, which used to be only up to the 10th standard until this year. With the previous policy, 50 percent of students who passed the 10^thstandard, dropped out of school due to limited support, and they hit the streets – what we call the ‘Job Market’. Most of these students come from humble backgrounds, and they are the ones who require enhanced opportunities to continue their education.

We will review our school curriculum and try to switch from Summative to formative style of education as we know that test-book based learning and exam based assessment is not the best forms of education.

We have realized the mismatch between the available jobs and the knowledge and skills possessed by the job seekers.

We have to make our educational system relevant to the present-day needs.

We want to invest as much as we can in wholesome development, emotional wellbeing, and resilience of our children and young people. Today, more than half of our population is under the age of 27. We need to understand this and be able to take advantage of this youthful potential, one may call it demographic dividend. We will therefore review and ensure effective implementation our National Youth Policy.

Bhutan’s fertility rate is 1.9 currently and projected to further decease to 1.7 by 2020. With rapidly decreasing fertility rate, increasing life expectancy and increasing youth unemployment in a small nation of just 0.8 million population, I really doubt if we are on the right track! If we do not take this seriously and bring in appropriate interventions, the little that we earn from the hydropower will not be enough to support our unemployed and aging population.

We have pledged to extent the 6 months paid maternity leave to all mothers, specially the rural mothers because we are not able to achieve the targeted 100% antenatal checkup, institutional delivery and immunization coverage.

And we will have about 12% of malnutrition and stunting, understandably among our rural children.

We will focus on nutritional requirements of our school children; we call it qualitative rather than quantitative feeding of our school children.

We are all aware of the 1000 golden days’ program. We would like to extend it to all the pre-school going children and call it 1000 Plus golden-days package, so that every child- from the time of conception to attending his or her school is very closely monitored by the government.

Only then can we be confident of the future of this Nation.

Excellences, Distinguished Delegates, Ladies and Gentlemen.

Economic development

Over last 3 decades, our GDP per capita has increased from USD 170 to almost USD 3500 today. With a GDP of only about USD 2.4 billion, we remain one of the smallest economies in the world. But with growth rate averaging 7.5 percent in the last three decades, we are also one of the fastest growing economies.

However,economic vulnerability is a persisting challenge. Our economic growth is largely driven by the hydropower sector which is climate dependentcontributes almost 30 percent of GDP. This however, has not translated into a corresponding sectoral share of employment.

Despite the fact that hydropower generation is vulnerable to the impacts of climate change,hydropower potential, will remain our biggest revenue-generating resource.

Since our target of 10,000 MW by 2020 is not happening, we are currently resetting our goal in this sector. In addition to the on-going projects, we will pursue few inter-governmental mega projects with the Government of India. My request to the Government of India on 2500 MW reservoir project over Sunkosh river was received positively by my counterpart during my last visit to Delhi. As we expand our Hydropower projects, we are mindful of its impact on our environment and vice versa.

On the other hand, our agriculture sector engages more than half the population(approximately 57.2 percent of labour force). However, this is mainly at a subsistence farming level. Contribution to growth is proportionately low, at about 17.4 percent of our GDP.

We are aware that we import huge quantities of agricultural products but most of our land in the rural area are left fallow-due to rural-urban migration. We want to encourage and substantially support our youth to take up agriculture at commercial level.

So, to ensure sustainable economic growth and employment generation, we must diversify our economy and private sector development will be a priority. We have to draw a line between private sector developmentand the State-Owned Enterprises [SOEs]. For this purpose, we have recently established a Private Sector Development Committee. We are also reviewing our FDI and CSI Policies, in preparation to our LDC graduation.

We fought the last election with the concept of ‘Narrowing the Gap’; Bhutan’s Gini index has increased from 0.35 to 0.38 in last 10 years. The concern here is not just the widening income gap but its coincidence with our 10 years of Democracy.

So, it is time to ask, Are the politically elected government doing things differently? Are there any holes that we need to plug before it is too late? Should we rethink the form of governance that we have?

Toaddress income inequalities,we are looking into several fiscal reforms. We will review the current taxation policy and bring in an efficient re-distributive taxation system. As a component of ‘ease of doing business, we are also looking into its subset, the fairness in doing business.

Ladies and Gentlemen.

Environment

Climate change is real and we must do something about it.

Our pursuit of socio-economic development is delicately balanced with a strong focus on environmental conservation. Although we are mandated to maintain (at least) 60 percent of the country under forest cover as per the Constitution, today we have 71 percent of the country is under forest cover.

Bhutan, as you know, has made an international commitment to remain carbon neutral. Climate change considerations are well integrated across all our economic and other development policies. For your information, all our policies will have to go through our GNH policy screening tool which is very Environment-sensitive, such stringent policies impedes our economic growth but our mission like that of SDGs is sustainable development under GNH philosophy. We are aware that our natural resources belong not just to the present but also our future generations.

We are too small in physical size to make any impact globally when it comes to climate change measure. In this regard, Bhutan requires the support of international community, as the impacts of climate change has no physical boundaries.

In addition to our stringent laws related to environmental conservation, we have projects to encourage Electric Vehicles, taxis and busses to start with; we are spending billions on fossil fuel imports.

We must realize that the natural environment is not just ours but belongs to our future generation.

Excellences, Distinguished Delegates, Ladies and Gentlemen.

Partnerships for development

With the participation and contribution of all the ministries, constitutional bodies, the judiciary, Local Governments, autonomous agencies, CSOs, private sector representatives, and the political parties, we have started the process to draft a long-term vision document for Bhutan. This document will guide us for decades to come…because our singular aim is to strengthen and further the progress of this country.

Over successive five-year plans, the Royal Government’s share of funding has steadily increased to more than 60 percent of total outlays since the 7^thFYP. The 12^th FYP is by far our most ambitious plan to date, with an outlay that will clearly exceed 4.5 billion USD. Out of this, we are trying to meet 70 percent from our domestic resources, and 20 percent through identified external grants.

The remaining 10 percent, 500 million USD will be the overall fiscal deficit in the 12^thFYP. We look forward to continuing our partnerships with our development partners to bridge the gap through innovative financing mechanisms.

So, my dear friends, in Conclusion

I would like to state that Bhutan is most fortunate that we have the:

– guidance of our visionary leadership in the form of our Monarchs.

– clear objectives,

-stable government,

-strong policies, and the continued and generous support from our development partners.

I wish to thank each and every one of you for your unwavering support. Bhutan’s success is our shared success. Your presence here is the testimony of your goodwill, friendship and solidarity at this crucial juncture in our development.

Thank you, Your Excellency, Mr Achim Stiener for making yourself available for us.

We look forward to the continued good relations and cooperation of all our development partners, and to working closely, especially in this last push towards LDC graduation.

You have come here as our guests, but please leave Bhutan as our Ambassadors.

I wish the 14th Round Table Meeting great success.

Thank you and Tashi Delek!