𝐄𝐜𝐨𝐧𝐨𝐦𝐲 𝐆𝐫𝐨𝐰𝐬 𝟕.𝟓 𝐏𝐞𝐫𝐜𝐞𝐧𝐭 𝐢𝐧 𝟐𝟎𝟐𝟒 𝐨𝐧 𝐛𝐚𝐜𝐤 𝐨𝐟 𝐞𝐧𝐞𝐫𝐠𝐲 𝐚𝐧𝐝 𝐬𝐞𝐫𝐯𝐢𝐜𝐞𝐬

…𝒔𝒆𝒓𝒗𝒊𝒄𝒆𝒔 𝒔𝒆𝒄𝒕𝒐𝒓 𝒍𝒆𝒂𝒅𝒔 𝒐𝒗𝒆𝒓𝒂𝒍𝒍 𝒈𝒓𝒐𝒘𝒕𝒉 𝒘𝒉𝒊𝒍𝒆 𝒉𝒚𝒅𝒓𝒐𝒑𝒐𝒘𝒆𝒓 𝒂𝒏𝒅 𝒆𝒙𝒑𝒐𝒓𝒕𝒔 𝒔𝒕𝒓𝒆𝒏𝒈𝒕𝒉𝒆𝒏 𝒊𝒏𝒅𝒖𝒔𝒕𝒓𝒊𝒂𝒍 𝒐𝒖𝒕𝒑𝒖𝒕

By Kezang Choden

Bhutan’s economy recorded a growth of 7.50 percent in 2024, according to the National Accounts Statistics released by the National Statistics Bureau (NSB). The country’s Gross Domestic Product (GDP) was estimated at Nu 280,007.94 million, reflecting a significant improvement from the 4.63 percent growth reported in 2023. This 2.87 percentage point increase signals recovery across several key sectors, with the hospitality industry registering the highest growth at 32.90 percent. The electricity sector followed with a growth of 10.92 percent.

External trade supported the upward trajectory, as exports of goods and services rose by 19.33 percent. Imports increased by 4.09 percent during the same period. Gross Fixed Capital Formation, which captures investments in infrastructure and long-term assets, grew by 5.33 percent. The services sector remained the largest contributor to the economy, followed by the industrial and agricultural sectors.

Following a contraction of 0.79 percent in 2023, the secondary sector recovered strongly in 2024, registering a growth of 6.96 percent. This marked an improvement of 7.74 percentage points over the previous year. The sector contributed 2.12 percentage points to the overall GDP growth, driven by positive developments in the construction and electricity sub-sectors. Gross Value Added (GVA) from the secondary sector stood at Nu 88,682.47 million, accounting for 31.67 percent of total GDP in 2024, compared to 29.40 percent in 2023. This reflects a 2.27 percentage point increase in its share of the national economy.

The hydropower sector continued to play a central role in the economy. According to the Druk Green Power Corporation Limited (DGPC), the successful completion of the 1,020 Megawatt Punatsangchhu-II Hydroelectric Project (PHPA-II) in December 2024 contributed significantly to national electricity generation. The project added capacity to the power grid and enhanced the country’s energy export potential. DGPC officials stated that hydropower remains a key contributor to economic growth and national revenue. With PHPA-II now operational, the sector is expected to make stronger contributions to the GDP.

In 2024, the service sector recorded a GVA of Nu 151,706.98 million, representing 54.18 percent of the country’s GDP. While this share declined slightly from 55.60 percent in 2023, the sector posted a growth rate of 8.63 percent. This growth follows earlier contractions during the pandemic years and underlines the sector’s continued significance to the national economy. In 2024, services contributed 4.90 percentage points to overall GDP growth. Sub-sectors showing marked improvements included hospitality, finance and insurance, professional and administrative services, wholesale and retail trade, and information and communication. However, some segments, notably entertainment, recreation and other services, reported negative growth.

The entertainment industry remains one of the most affected within the service sector. Kezang Phuntsho, owner of Kalapingka Entertainment, noted a persistent decline in revenue and customer engagement across the sector. “During the pandemic, many people learned the value of money and became more cautious with their spending. This shift has directly impacted entertainment businesses like nightclubs, karaoke bars and event venues,” he said. According to him, many establishments have seen drastically reduced footfall, with some nights attracting no customers at all. “Some club owners are now on the brink of shutting down due to heavy financial losses,” he added.

Kezang further observed that the increasing use of social media platforms such as TikTok, Facebook and Instagram has diverted people’s attention from physical entertainment venues. “People now prefer to stay home and scroll through their phones rather than spend money going out,” he said. The decline in the entertainment sector has broader implications for economic diversification and youth employment. Business owners in the industry are seeking policy intervention and support to address the challenges they continue to face.

The primary sector also saw improvement, registering a growth of 3.73 percent in 2024, compared to 1.37 percent in 2023. This represented an increase of 2.36 percentage points. All three sub-sectors contributed to the growth: agricultural crops grew by 2.51 percent, livestock by 4.06 percent and forestry and logging by 6.16 percent. The sector’s GVA reached Nu 39,618.48 million, up from Nu 37,312.31 million in 2023, contributing 14.15 percent to the overall economy.

Bhutan’s export sector recorded a significant increase in 2024, with total exports of goods and services valued at Nu 88,188.11 million at current prices. This represented 31.49 percent of the GDP, an increase of 3.11 percentage points over the previous year. Exports of goods led the expansion, growing by 9.29 percent and contributing 69.45 percent of total exports. Although the growth in service exports slowed sharply from 873.03 percent in 2023 to 50.80 percent in 2024, they still accounted for 30.55 percent of total export value.

Imports of goods and services rose to Nu 134,033.31 million in 2024, up from Nu 132,764.78 million in 2023. Imports made up 47.87 percent of GDP. Of the total, goods accounted for 86.27 percent, while services contributed 13.73 percent. The overall growth rate of imports reached 4.09 percent, recovering from a decline of 0.61 percent in the previous year. This was a 4.70 percentage point improvement. Imports of goods rose by 14.22 percent, whereas imports of services declined by 33.17 percent compared to 2023.

The nation’s economic performance in 2024 reflects a broad-based recovery, with strong growth in key sectors such as services, electricity, and construction. The return to higher GDP growth was supported by increased exports, infrastructure investments, and the commissioning of a major hydropower project. While most sectors registered positive trends, challenges remain in specific areas like entertainment and service imports, highlighting the uneven pace of recovery. The data points to sustained momentum in the overall economy, though continued policy attention may be required to support struggling industries and maintain balanced growth.