Trade and the Environment: A Perspective from Bhutan

Abstract

The external trade sector is very important for the development of the Bhutanese economy. As the domestic manufacturing sector is small and limited, most goods for consumption and investment have to be imported while exports help to finance these imports. Bhutan’s imports have always surpassed exports, even though the latter rose rapidly in the second half of the 1980s. Because of a steady inflow of foreign aid, the overall balance of payments remains in surplus. Apart from the export of cash crops, a few major industries also contribute to the growth of the export sector. Electricity is by far the most important export, followed by timber and wood products, calcium carbide and cement. The contribution of the export sector to GDP is increasing steadily.

The views expressed in this chapter are the author’s own and do not necessarily reflect the views of the Royal Government of Bhutan.