A Time for Change

Rice paddies above the Paro balley

The grass is always greener

On Election Day this past Saturday I went out for a long bike ride with a friend. We started in the early dawn, and over 200km we visited a quiet polling station and rolled through rural villages, commenting on election posters. We even had the good fortune of crossing paths with Tshering Tobgay, President of the contending People’s Democratic Party (PDP) and a big cyclist himself, as he headed to Haa with his wife to observe the counting of the postal ballots. We did not guess at the time he would soon be Prime Minister.

By the time we finished our ride and got in front of a computer at 6:30pm, the first reports were just starting to trickle in on the Kuensel and BBS websites. In the primary election, PDP gathered 33% of the vote compared to incumbent Druk Phuensum Tshogpa’s (DPT’s) 44%, so it was with surprise that we watched as PDP constituency wins crept up at twice the speed as DPT’s.

Within two hours of the polls closing, PDP won on twitter and within four hours is was final on BBS: PDP would form the new government with 32 seats to DPT’s 15. Twitter became a flurry of Bhutanese voices, mostly PDP supporters, declaring that the people have spoken. I have yet to meet anyone who would have predicted such a win, but even most who are not ardent supporters of PDP agree that it was time for a change.

Based on recent conversations with everyone from taxi drivers to memvers of the National Council, here are a few thoughts on changes that some Bhutanese are looking for:

An Approachable Government
From my own encounters with Jigme Thinley, I can appreciate his eloquence, but I would never have labeled him as approachable. Over tea at the New Development Paradigm meeting on Gross National Happiness in January, I has the opportunity to ask him how GNH can be incorporated into the practicalities of business. With a sigh, I was brushed off for a photo opportunity and lack of a suitable answer to a complicated question.

I was not the only one brushed off. A member of the National Council (Upper House) mentioned that reports and recommendations that they pulled together were completely ignored by the overwhelmingly DPT National Assembly (Lower House). In 2011, the Chief Election Commissioner chastised DPT’s use of Constituency Development Grants to attempt to keep rural voters happy and potentially influence the election. “As expected, and in keeping with their habits of ignoring the opinions of others, the DPT leadership simply ignored him.

Tshering Tobgay: Open for Business

In contrast, PDP has explicitly promised an open door policy, in which ordinary citizens can speak to Ministers, including the Prime Minister without appointment during specified times. This is a very hierarchical society, with a history of lords and serfs that was abolished only last century. Now we may actually see the boundaries between citizens and their government diminished as well.

Humility and Frugality
It appears that there was more than just the intellectual alienation that put people off. Living in this poor country, I was surprised to find an extravagant Ministers Compound, official Land Cruiser vehicles and peaceful guards armed with AK47s. This is not the same Bhutan that I see when I visit Trashigang or trek to Laya.

Others are more explicit in their condemnation. On the satirical Bhutanomics Facebook Page (the website is actually blocked in Bhutan) I came across the following assessment, which I have heard echoed elsewhere:

“The patangs (swords), kabneys (ministerial scarves), Land Cruiser Prados, special number plates, Constituency Development Grants and allowances could have waited. They forgot that they were placed on the high office for a noble purpose. We wanted them to represent us, to speak for us, to bring fairness, equality and justice. Instead they choose to differentiate themselves further from the commoners and align themselves with the rich and the powerful… I felt betrayed.”

Is he a Have or a Have Not?

Dreaming of a Prado

In contrast to DPT Ministers requesting for their official cars to be gifted to them, Tshering Tobgay made a point of returning his car and retiring his orange ministerial kabney and his sword. He has been accused of showboating by inviting the press, but none could deny that he did the right thing when he symbolically became an ordinary citizen during the few months that the Government was dissolved.

The Wrong Foreign Relations
In recent years, Prime Minister Jigme Thinley made quite a splash on the world stage. Diplomatic ties have now been created with 53 countries. In April 2012, Bhutan hosted a UN Summit in Happiness and Wellbeing at UN Headquarters in New York. The event made significant strides for the global support of Gross National Happiness, but failed to engage with the Bhutanese population back home. In another UN play, Thinley made a bid for a rotating seat on the UN Security Council late last year. When few votes were garnered and Bhutan lost to South Korea, Thinley was publicly accused by the Opposition of being irresponsible with Government resources.

Jigme Thinley and a delegation of politicians were also present at the Earth Summit in Rio in 2012, where it was announced that Bhutan would celebrate Pedestrian Day every week. Also while in Rio, Thinley met with the Chinese Premier Wen Jiabao, marking the first time that leaders of the two countries have ever met. Many in Bhutan and India speculate that this meeting played a significant role is undermining relations with India. Read more here.

While Bhutan reaches out to the rest of the world, it is effective in spreading GNH and an increasing awareness of this tiny mountain Kingdom. However, some believe that in looking abroad, Bhutan has been ignoring the single foreign relation that matters: India.

The Right Foreign Relation
Bhutan’s relationship with India is special. 100% of Bhutan’s foreign revenue from hydropower sales comes from India, 90% of trade is with India, and 60% of Bhutan’s Government budget is financed by India, possibly more.

In the weeks before the election, there were some political bumps with India as the subsidy on LPG and Kerosene which Indians enjoy was suddenly cut in Bhutan. Interestingly, it was announced the same day that the subsidies would expire in India, but that the cuts would take place next spring. The papers, twitterati and PDP had fun depicting this as a political move by India to punish Bhutan’s blossoming relations with China, while India’s matter of fact response was that the agreement ran out at the end of July. Meanwhile, it will likely never be known whether the move was politically motivated or not, but it almost certainly had an influence on the election.

Some who are disgruntled with the results are saying that “India won the elections”. In a press conference today, Tshering Tobgay was quoted as saying “India, as far as I know, did not interfere in the electoral process; India has not and, as a good friend, will not interfere in the electoral process.” Also today the Indian Ambassador denied any political motivation behind the lapse in subsidy agreement.

Many people here talk about the trade deficit with India, but it appears that there is a trust deficit, which will be more urgent to fix.

Denial of a crisis at home
While the Bhutanese economy continues to show strong growth in GDP, I would argue that it is not a balanced, sustainable or ‘GNH’ growth. According to The Bhutan Observer, “Critics say government expenditure has been excessive. Economy is in a mess. Doing business is cumbersome. Youth unemployment is high. Poverty is still very visible. Agricultural production is dismal. Education quality is an issue.”

Beyond the big hydropower project that are being financed and build by Indians, there are three interlinked economic crises at home: a trade imbalance with India, a domestic credit crunch, and a burgeoning youth unemployment. DPT downplayed all three to the point that it was hard to find believable numbers on imports, bank loans or unemployment.

Participation is more important than winning

We need participation in the economy and the elections

Two policies that were put in place by the Ministry of Economic Affairs failed to stem the challenges. As it was eloquently put in The Bhutanese on Sunday, “The twin Rupee and Credit Crisis that stated in late 2011 was progressively getting worse, and it did not help that DPT denied the problem in many instances… The incumbent government had failed to breathe life into its Economic Development Policy (EDP) and Foreign Direct Investment (FDI) Policy.”

Both of those policies could do with revisions to make them simpler and easier to navigate. But it will take more than the removal of red tape to make the economy function. The new Government finds itself in a unique situation of inheriting a tough economic situation despite growth rates of 8-9%. The hydropower project will roll on, as will the debts to service them. GDP will keep growing, but the challenge will be in creating domestic jobs and local products that create the ‘real’ economy and boost GNH.

Focus on a GNH philosophy rather than GNH in practice
While the GNH philosophy was successfully sold to the rest of the world under the rule of Jigme Thinley, it has not yet come into practice in Bhutan. A frank writer from The Economist noted that “Hardly anyone mentions the ‘Gross National Happiness’, or GNH, that Bhutan’s leaders trumpet abroad as the national credo and an alternative to the pursuit of economic growth.” The article goes on with a critical and insightful assessment of the Last Shangri La. Critics exist at home as well. Dasho Sonam Kinga, currently the chairperson of Bhutan’s upper house, said the country is facing a crisis of vision: “These are not times to preach GNH abroad; it is time to pay serious attention at home.”

That attention does not mean abandoning GNH, but rather figuring out what it means in practice. Bhutan’s Fourth King famously said that GNH is development with values. In their Manifesto, PDP states that Project and policies that are suitable and in line with GNH principles will be given a priority.

The road from Haa to Chuzom

Making Progress after a landslide

In conclusion, here are my five ways for PDP to deliver some of the change that Bhutanese people voted for:

1. Open Government – PDP has promised an open door policy and an approachable Government, and the citizens will surely test this and remember their experience. As a child, I remember writing a letters to my senator and getting a reply. Remembering that the Government works for the people will be a key to success, and implementing the promised Right to Information Act will take it one step further.

2. Be Humble and Frugal – Already this has been demonstrated by Tshering Tobgay, and I believe that he has a much humbler personality than those in power before him. If the temptation of power does not change this, then careful cost cutting in the Government and especially for Ministers will sit well with the voters who are struggling to make ends meet.

3. Prioritize Foreign Relations – It will certainly be wise to cultivate more transparent and trusting relations with our neighbor to the South, if only to avoid nasty surprises in the future. This is not to say that all other countries should be ignored, but the stage that matters in the one at home, not in Rio, New York or any other city in the world.

4. Fix the Economy – This is certainly easier said than done, but admitting that there is room for improvement is the first important step. The PDP Manifesto highlights some places to start: import substitution, agricultural infrastructure and exports, technical skills training, reforms to ease doing business and simplification of FDI policies.

5. Practice GNH, Don’t Preach It – Embedding GNH into the government, business practice, education and performance management will not be easy, but it will be necessary. There are many policies about environmental regulation, human development and Corporate Social Responsibility in business that currently ring hollow. They will need teeth and better governance to overcome temptation and self-interest if GNH is to become a reality for all citizens.

View over Haa from near Chele La

Still some stormy weather ahead…

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10 responses to “A Time for Change

  1. Pingback: Tips for PDP from a Chilip - Bhutanomics : The Bhutan Analytics·

  2. Found on Bhutanomics:

    1. Mr. Krantz seems to be a harsh critic of JYT and his government, with his recent article of July 16, 2013, entitled, “Time for Change”, in Bhutan Chronicles, as well as “Tips for PDP from a Chilip” in Bhutanomics: The Bhutan Analytics dated July 17, 2013 simply because he was brushed aside by JYT during the New Development Paradigm conference in Thimphu. So, his opinion can be biased against what the government or governments had done in the past without really knowing the background situation and challenges faced those days. We have had a number of foreigners writing negatively about Bhutan in the recent past simply because their personal agenda could not be fulfilled or could not get along with individuals.

    2. I believe Mr. Krantz was hired to advise DHI on how to improve the private sector. Among his numerous articles on Bhutan, except for his article, “5 reasons why Bhutan should be at Davos”, I could not find anything much on the main subject that he is supposed to address. At XX,XXX a month salary, we would like to know his personal contributions to DHI as the strategic adviser to the CEO of DHI or as a development practitioner or as an expert on governance and sustainability as he claims to be in Bhutanomics/Bhutan Chronicles. One of his advices to PDP is to “be humble and frugal” which is where he seems to have failed to advise the DHI bosses. As they say charity should begin at home.

    3. I was once told by an international adviser I knew, like Mr. Krantz, that advisers have the easiest of the jobs because it is ultimately up to the advised whether to follow their advice or not. Advisers and consultants are people who have the cushiest of jobs because they do not have any accountability in the end. In that respect, I would take anything advisers like Mr. Krantz say with a pinch of salt because they can write or say anything knowing very well that when we find out that their advice was wrong they would have long left the country.

    • Thank you for your insights, in particular on my salary!

      I am comforted that I am not alone in my opinion of JYT, as a majority of the population seems to have shared my views in the election last weekend. I can also hope that the intolerance of criticism, constructive or otherwise, demonstrated by the last government is a thing of the past! I do my best to be constructive in my recommendations, and I know that no matter what I do, there will be critics and cynics, though I would prefer that they not hide behind pseudonyms and IP addresses.

      My role here is driven by my own convictions and by my experience as a Director at the World Economic Forum. I am now an employee of DHI, and as such I play by their rules and get paid according to their standards. I am not paid by any international organisation to drive an agenda, and I do not work for a consultancy. Lest one assume that I am here on a holiday to get rich off the Bhutanese, this clearly not the case. I am comfortable in both the sacrifices I have made to be here and the hard work I am contributing during my short stay here.

      You seem to know how to find me and I am not one to hide, so glad to discuss any time!

      • First of all, that was a comment i saw on Bhutanomics and saw fit to let you know what people are saying…

        [JYT and our new PM] are both politicians – Bhutanese Politicians – and can be masters in the art of disguise. I am a fan of neither, but as a Bhutanese voter, I was dissapointed with the mud-slinging and smear campaigns that dominated the election.

        While you are keen to criticize all facets of the old government, you left out many of their achievements. […] I hope your enthusiasm for “constructive criticism” will not end with the ushering of a new government headed by your good friend Tshering Tobgay.

        Regarding your work for DHI and your salary (Bhutan is a small country, everyone knows everything about each other, so nothing to be bothered by really) this is none of my business really. However, it Is a state owned company so we’d hope all its employees are doing their work 🙂

      • Hi nima, (I tried to email you, but your email address seems to be fictitious…)

        I clearly owe you an apology for my assumption that you were the author of the response on bhutanomics. The nerve that was touched was one of frustration, as I have worked in many countries around the world, and never have I felt so warmly welcomed and unwanted at the same time. It seems that the streak of xenophobia here is not common, but can run very deep.

        I certainly agree that neither party impressed me during the campaign period. I would not argue that DPT has done many things right, and that PDP will get many things wrong. As you suggest, constructive criticism should be distributed equally when merited, and like you, I believe that the betterment of Bhutan is paramount, and that there is no “good enough”. In fact, in my next post, I will challenge PDP on some of their ambitions for the first 100 days, many of which are over ambitious, and several are purely politically driven.

        I look forward to your continued constructive criticism of my work here in hopes that it will enable me to deliver more for this country that we both love. (You can easily reach me by email if you wish to continue the conversation.)

        Randall

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