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๐“๐ซ๐š๐ง๐ฌ๐Ÿ๐จ๐ซ๐ฆ๐ข๐ง๐  ๐๐ก๐ฎ๐ญ๐š๐ง ๐ข๐ง๐ญ๐จ ๐š๐ง ๐ˆ๐ง๐ฏ๐ž๐ฌ๐ญ๐ฆ๐ž๐ง๐ญ ๐‡๐ฎ๐›: ๐ˆ๐ง๐ฌ๐ข๐ ๐ก๐ญ๐ฌ ๐Ÿ๐ซ๐จ๐ฆ ๐ˆ๐ง๐๐ฎ๐ฌ๐ญ๐ซ๐ฒ ๐‹๐ž๐š๐๐ž๐ซ๐ฌ

โ€ฆ๐‘ฌ๐’™๐’‘๐’๐’๐’“๐’Š๐’๐’ˆ ๐’•๐’‰๐’† ๐‘ฎ๐’†๐’๐’†๐’‘๐’‰๐’– ๐‘ด๐’Š๐’๐’…๐’‡๐’–๐’๐’๐’†๐’”๐’” ๐‘ช๐’Š๐’•๐’š ๐‘ฐ๐’๐’Š๐’•๐’Š๐’‚๐’•๐’Š๐’—๐’† ๐’‚๐’” ๐’‚ ๐‘ช๐’‚๐’•๐’‚๐’๐’š๐’”๐’• ๐’‡๐’๐’“ ๐‘ฌ๐’„๐’๐’๐’๐’Ž๐’Š๐’„ ๐‘น๐’†๐’‡๐’๐’“๐’Ž ๐’‚๐’๐’… ๐‘ฎ๐’“๐’๐’˜๐’•๐’‰

By Yeshey Lhadon

In a significant gathering at the Bhutan Innovation Forum, influential investors and thought leaders convened to explore the promising investment landscape in Bhutan, particularly through the upcoming Gelephu Mindfulness City (GMC) initiative. This event showcased strategic insights from four distinguished speakers who shared their perspectives on capital investment, challenges, and opportunities in this rapidly evolving market.

Setting the tone for the discussion, John Pfeffer, founder of Pfeffer Capital LP, outlined compelling reasons to invest in Bhutan. He emphasized the country’s abundant renewable energy resources, particularly hydroelectric power, and pointed out Bhutan’s geographical advantage due to its proximity to India. โ€œThe GMC could act as a catalyst for broader economic reforms in Bhutan,โ€ Pfeffer stated, praising the nationโ€™s leadership for fostering a conducive environment for foreign investment.

Pfeffer said that the leadership of Bhutanโ€™s monarchy is a significant draw for potential investors. โ€œBhutan’s strategic leadership, including the king’s vision, has fostered a collaborative environment among government and state-owned enterprises, which is crucial for attracting foreign investment,โ€ he remarked. However, he did not shy away from addressing the challenges investors face in accessing the Bhutanese market, particularly capital controls and limited avenues for participation. He noted, โ€œForeign direct investment is essential, especially in renewable energy and data center clusters,โ€ while urging the development of capital markets to create more opportunities for public investors.

Amarit Charoenphan, managing partner at Aim Ventures, provided a unique perspective by highlighting the challenges faced by local entrepreneurs. He introduced the concept of โ€œnurture capital,โ€ emphasizing the need to support entrepreneurs through their personal and professional challenges. Charoenphan noted the transformative potential of technology, particularly artificial intelligence (AI), in helping local businesses overcome legacy issues. โ€œMindful capital is essential in responding to the unique needs of Bhutanese entrepreneurs,โ€ he remarked, showcasing the optimism he found during his interactions with local startups.

He also stressed the importance of branding Bhutanโ€™s investment opportunities, noting that many potential investors remain unaware of what the country has to offer. Charoenphan suggested that improving marketing strategies would be critical in attracting foreign interest.

Discussing the types of capital required for GMC’s development, Cyrus Hiramanek, managing director at M. Klein & Company, drew a distinction between infrastructure capital that is necessary for the physical development of GMC and corporate capital, essential for the businesses operating within it. โ€œInvestors are primarily looking for scalability and long-term returns,โ€ Hiramanek explained, emphasizing GMCโ€™s access to large markets and clean energy as critical investment factors.

Hiramanek highlighted the relatively small market capitalization of Bhutan, approximately USD 900 million, which may deter larger institutional investors. However, he expressed confidence that as the private sector and capital markets grow, more opportunities will arise. He noted the importance of engaging with sovereign wealth funds and clearly communicating a vision for GMC to attract the necessary capital for infrastructure development.

Chencho T. Namgay, director of investments at DHI, provided broader context on foreign investment in Bhutan. He acknowledged existing challenges, including market opportunities and regulatory hurdles, but expressed optimism about growth potential through the GMC initiative. โ€œThe GMC presents a unique opportunity to adopt the best laws and policies to promote business,โ€ he noted, advocating for GMC as a model for governance and investment policies that could attract foreign direct investment.

Chencho Namgay emphasized the need for strategic planning in envisioning a sustainable city like GMC. He pointed out that attracting philanthropic funds and multilateral agencies to support development would be crucial. His insights highlights a shared vision among the panelists: fostering a sustainable and innovative investment environment while addressing the unique challenges faced by local entrepreneurs.

As the discussion progressed, the panelists collectively shared the importance of strategic investment in Bhutan, particularly through the GMC initiative. Their insights illuminated a promising landscape for investors looking to engage with Bhutan’s emerging economy, especially in sectors such as renewable energy, infrastructure development, and technology.

During the discussion, the panel addressed the complex dynamics of attracting private investors in a developing economy characterized by currency controls and limited exit strategies. Pfeffer highlighted that increasing market liquidity could create a self-reinforcing cycle, attracting larger pools of capital over time. However, he cautioned that Bhutanโ€™s pegged currency complicates foreign investors’ ability to move freely in and out of the stock market, potentially leading to volatility.

Charoenphan noted the need for a combination of venture capital, grant funding, and government support to create an environment where Bhutanese companies can raise significant capital without giving away excessive equity early on. He stressed the importance of nurturing local entrepreneurs who possess international experience, as they can significantly contribute to building Bhutan’s startup ecosystem.

The GMC aims to cultivate human ingenuity, and the discussion also touched on sectors that could attract the best minds for sustainable development. Chencho Namgay mentioned that while hydropower remains a natural advantage, GMC’s future aspirations extend beyond that, embracing innovation and creativity. He expressed optimism about emerging technologies, suggesting that the mindful development ethos of GMC could lead to ethical advancements.

Charoenphan posited that as new structures for investment emerge, especially those focusing on sustainability and social responsibility where Bhutan has the potential to distinguish itself as a leader in responsible investment practices. He proposed integrating a โ€œmindfulness certificationโ€ for companies operating within GMC to enhance their appeal and align with global trends toward socially responsible investing.

The panel discussion concluded with a call to action for both the government and potential investors to harness Bhutan’s unique advantages such as its natural resources, culture, and strategic location-to create a thriving economic environment in GMC. The vision shared by the panelists aligns with His Majesty’s aspirations for sustainable growth and a prosperous future for Bhutan.

As Bhutan embarks on this transformative journey, the GMC stands as a beacon of hope, promising not only economic development but also the well-being of its people through mindful investment and innovation. The interplay of capital, technology, and governance, as discussed in this session, presents a promising landscape for investors looking to engage with Bhutan’s emerging economy, with the GMC poised at the forefront of this transformation.


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