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The drop in Bhutan Travelers.

Bhutan TravelersThe flow of tourist here in Bhutan for this year has doped compared to last year .The flow  of tourist compared to last year’s  major festival like paro festival  and  upcoming festival next month’s like thimphu festival has seen major drop in numbers despite the increase in dollar exchange rate. The reason could be the competition of new destination like Myanmar and sri lanka.

The drop is attributed to countries like Myanmar and Sri Lanka emerging as new destinations in the region, which diverted some potential visitors from Bhutan.

While the tourism council of Bhutan (TCB) refused to divulge any information on the drop, tour operators ascertained the drop, with a majority of them failing to bring in tourists like they did last year.

Etho Meto tours and treks that is among the top ten companies in terms of revenue generation every year, expects a drop of about 30 to 40 percent by this year end.

The company’s main market being the US and Europe, officials said they expected the drop, going by the fiscal threats in the US and the Euro zone’s economic strain. “But the drop was beyond expectations and it’s huge,” said the company director, Sangay Wangchuk.

“Last year, we also saw many specialized operators around the world being bought by giant groups,” he added. “Myanmar, emerging as a new destination in the region, has also diverted some of our potential visitors.”

“However, the increasing USD rate has come as a great respite, and this will favour the revenue generated by the tourism industry,” opined Sangay Wangchuk.

Bhutan Tourism Corporation limited that also brings in the highest number of tourists every year saw a drop of about 14 percent, as of June, this year. “We’re still trying to diagnose the situation,” said the tour operation manager, Karma Gyeltshen, adding that they have also experienced diversion of tourists towards Myanmar.

Also among the top ten companies, All Bhutan Connection’s (ABC’s) managing director, Tshering Dhendup, said, despite the drop, the USD rate this year, which was almost double from last year during the same period, helped. “In terms of earnings, there shouldn’t be much difference, should the USD remain high throughout the peak season,” he said.

Last year, ABC tours and Druk Asia, another company under the same ownership, catered to over 4,000 tourists, while so far they have hosted about 1,000 tourists.

Wind Horse tours and treks also witnessed a drop by about 110 tourists, so far, compared to the same period last year. “Tourism is an export product and the increasing the USD rate is good for us, provided that there’s no inflation in the economy,” said the managing director, Rinzin Jamtsho.

The decline, according to Rinzin Jamtsho, is also due to the emergence of Sri Lanka, apart from Myanmar, as a new destination, which until about two years ago remained restricted to tourism. “They’re growing destinations for the European market as well, with whom we now have to compete.”

Although the national airlines, Drukair, saw an increase in revenue in first half of this year, officials said there has been a drop in passengers, who paid in foreign currency.  Only 44 percent of passengers carried this year paid in foreign currency, as compared to 49 percent during the same period, last year.

Some tour operators also stressed the need for TCBS to come up with more product diversification to market Bhutan as a potential tourist destination. “Merely attending fairs and road shows alone isn’t enough,” said one. “And the impact of such marketing strategies has to be assessed, rather than doing it just for the sake of it.”

Another tour operator said, at an individual level, being entirely dependent on their agents abroad, tour operators alone can’t do much. “Only if TCBS and the government do it on a larger scale, then can we expect good results,” he said. “No matter how much ever we spend on marketing, only five percent of our total turnover is tax deductible.”

“The air service, according to tour operators, was another factor that led to a lot of cancellation of tours, especially during peak seasons, due to unavailability of tickets,” he said. “Our clients require information way ahead of their travel, while the additional flights are usually fixed at the last hour.”

Meanwhile, the government in its manifesto stated it will increase annual tourist arrivals to 200,000 in the next five years, and double the revenue from the tourism sector through tariff revision, aggressive marketing and reduction of royalty.