Hotels upscale, undergo extensive reconstruction for tourism reopening

… team building peaking for the hotel industry

With the possible reopening of the tourism industry in the country, hoteliers are readying their businesses by upscaling and renovating their properties. 

The tourism industry closed after the pandemic hit the country in March 2020. 

In line with the expected reopening of tourism in the country, hotels and other stakeholders of the tourism industry were given a preparation time by the government.  

Hoteliers are trying to upscale to Blue Poppy 3 category by transforming the design and elevating the hospitality experience, and also encompasses extensive upgrading of rooms. 

With the reopening, the tourism industry is expected to see various reforms, this was said in an earlier interview by the foreign affairs minister, also the chairman of the Tourism Council of Bhutan, Dr Tandi Dorji. 

Thimphu Boutique is expecting to upgrade to Blue Poppy 3 to reopen for tourists. 

The manager of the hotel, Yeshi Tashi Gocha said they have done major expansion works, and also maintenance work. To add more features to the hotel, he said that they have added an outdoor café and also equipped their kitchen with a woodfire oven, a rare oven in the country.

He said that the expenses have crossed over Nu 1.5 million. 

Meanwhile, there is also a tussle between hotel owners and their sub-contractors. 

Some of the sub-contractors of the hotels across Thimphu have said that after struggling for more than two years, the hotel owners are hinting at ending the contract. 

Owners claim that they have been given enough time for them to make business in the past two years through the quarantine facility, and they wish to upscale too. “Subcontractors only think about making profits, they don’t wish to upscale the property,” said a hotel owner. 

“Rooms and other properties in the hotel are in ruins, and also, the COVID situation in the country has also hit us,” he said, adding, “if they wish to upscale the property, I am always ready to extend the contract”.

However, some of the hoteliers that cater to regional tourists are waiting for the guest inflow. “As there is a tariff on regional tourists this time, we are waiting for guest inflow, and subsequently, we will work on upgrades, and other hotel amenities,” said a hotel owner in Paro, Rinchen Dorji. 

Some hotel owners have also restructured their hotels to accommodate commercial spaces. “Due to the long halt of the tourism industry, we had to restructure our hotel for commercial space, however, we are expecting to revert to our hotel standard,” said a hotel owner in Thimphu.

Impact of tourism in the country:

According to the State of The Nation report, the direct reduction in tourism earnings is estimated at 40 percent for financial year (2020) and 100 percent for financial year (2021) as international tourism has not yet resumed as of September 2021. On a calendar year basis, gross receipts fell by 92 percent to $19.84 million in 2020, from $225.87 million in 2019. Direct revenue is estimated to have dropped by 90.4 percent to $2.63 million in 2020, from $27.23 million in 2019.

According to Asian Development Bank (ADB) report of ‘Lessons from coping with the pandemic in a tourism-dependent economy’ (December, 2021), it states the tourism sector is strategic for Bhutan on multiple fronts. In the years prior to the pandemic, the sector was a strong driver of growth that also facilitated the growth of auxiliary sectors such as transport, hotels and accommodations, and handicrafts. Tourism inflows in the last five years grew at a near compounded annual average of 30 percent.

The report further states that during the pandemic, 50,737 people from the tourism sector have been affected directly and indirectly.

A rapid socioeconomic assessment conducted by the United Nations Development Programme and the National Statistics Bureau involved the designing of a Multidimensional Vulnerability Index for Tourism (MVI-T) which identified eight deprivations: (i) income loss, (ii) coping strategy, (iii) loss of livelihood, (iv) food security, (v) limited savings, (vi) indebtedness, (vii) vulnerable household members, and (viii) tourism dependence, states the report.