Global Policy Forum

By Marc Wolfensberger

Bhutan is negotiating to join the World Trade Organization, a move that would bring into the global economic community a Himalayan kingdom that measures economic growth with a happiness index.

"Many good things can be measured, and happiness is definitely one," Finance Minister Lyonpo Yeshey Zimba said Wednesday in Geneva. "The index is rising every year."

King Jigme Singye Wangchuk introduced the index to measure development after he took the throne at the age of 17 in 1972. By more conventional measures, gross domestic product per person falls between $300 and $800, depending on population estimates. Bhutan has not conducted a census since 1969, but it is thought to have a population of about 750,000.

By agreeing to reduce trade barriers and join the WTO, Bhutan will have to open its borders more rapidly. Until the 1960s, when India helped Bhutan build its first roads, all travel was by pony or on foot. Satellite television was banned until the late 1990s and tourists must pay $200 a day to visit.

In December, the WTO agreed to accelerate the accession of developing nations such as Bhutan, which is among the world's 40 poorest countries and has just four foreign embassies.

The country is sandwiched between India and China. Its currency is pegged to the Indian rupee and foreign policy is guided by New Delhi. While other rulers travel the world, Wangchuk's visits rarely extend farther than New Delhi.

"Now we're ready for democracy, and a market economy," Zimba said. "But we have to go slowly."

Zimba declined to go into details of the happiness index, but he said it took into account a sustainable balance among the economic, social, emotional and cultural needs of the people.

Exports from Bhutan total about $100 million a year, equal to the foreign aid the nation received in 2002. More than three-quarters of the cement, furniture and fruit juices it sells go to a single market, India. Its top-earning export is hydroelectric power, which it also sells to India.

Travelers to Bhutan, flying in on one of the two aircraft operated by the national airline, Druk Air, form an exclusive club: Some 5,594 visited last year, according to the Bhutan Tourism Corporation Ltd. By 2007, the government said, it expects the number of tourists to triple and total revenue is projected to reach $21 million a year.

"We decided to limit the number of visitors through a pricing mechanism, so you don't get too many people and don't let people in who might bring bad influences," Zimba said.

Population growth is increasing pressure for economic expansion. Forty percent of the Bhutanese are under 15 years old. Free access to health care raised life expectancy by 18 years to 66 in the decade after 1984.

"Young people who have received an education are not going back to their villages to work on their farms, so we have to generate employment," said Zimba, who was himself sent by the king to India and the United States to complete his studies.

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