Liberalization in the Economic sector and the Social sector

The idea of liberalization in the Bhutanese context brings to my mind the the tourism sector on one end and the health sector on the other (from the social sectors).

With liberalization of the tourism sector, it is only natural that most operators and stake holders would be displeased as this would mean entry of more competitors. It would make doing business in the sector very difficult if it wasn’t difficult already. Some would even argue that uncontrollable number of visitors would jeopardise cultural diluation at a rate very difficult to rectify. But there are still others who would look at it from a positive perspective. A perspective of opening up avenues for self-employment by more people and better trickle down effect. It may sound hypothetical but it’s time more people tap into this natural resource by allowing a more convenient environment. This argument can only be strengthened once the details are etched out. However, working towards more standard hotels is another interesting issue. Although stakeholders of the tourism sector have been expressing displeasure with the idea of liberalization with the argument of protecting the exclusivity of Bhutan; raising the standard of local hotels on the other hand has not received much warm reception either interestingly, perhaps it is so because the hospitality sector and tourism do not integrate together when it is logical to do so. Liberalization in the sector would mean offering opportunities to more Bhutanese in jest.

On the other hand privatization in the health care system could back fire. Hypothetically speaking, if private hospitals were to come into Bhutan for the reason of ‘relieving pressure’ of the public health care delivery system so that better services could be provided to all. It then becomes a question of affordability, unless ofcourse the entry of the private hospitals does not in any way disturb state spending in the Social sector and how it is operated.

In my mind there are a few pointers to ponder on before allowing privatization in the health care system.

Pro-privatization people are fond of saying that privatization will “relieve pressure” on the public system, helping to control costs and reduce waiting lists. But, these benefits do not necessarily happen and for the reasons I now cite below:

*Private hospitals and clinics cost more. Unlike public establishments, private hospitals and clinics need to set aside significant amounts of money for things like investor profits, marketing and taxes. Public establishments are waived do not have to pay these dues. As a result, only a small proportion of money spend in private establishment actually goes to patient care. In contrast, almost all the money spent in the public system goes directly to front-line care.

*Private health care creates longer waiting lists by siphoning personnel and resources way from the public system. Doctors and other professionals are lured away from the public system by higher salaries in the private sector. The resulting staff shortages in the public system lead to longer waits for treatment, not shorter ones. This has been a reason that we have been toiling with even as an idea for sometime now.

Given these reasons, which I do not claim to be definite, needs to be weighed. If the poorer section of the Bhutanese society needs to wait longer for a sub-standard health care and if the ones who can afford and pay more also need to wait longer becasuse there are richer customers (it is important to remember that the target market is not Bhutan); which Bhutanese stand to gain? Yes, the Government would have helped generate more revenue by way of taxes and also, created jobs but this could cost the average Bhutanese much more than meets the eye.

I remain open with the issue as it has the most profound of implications on the lives of all of us.


About Sangay Khandu

Elected to Parliament of Bhutan twice. Previously worked with the Central Bank, the largest SoE (power utility) and international organization.
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