Government establishes private sector development board
The government has established a private sector development board to come up with a policy framework for the development of the private sector. It is also expected to help determine the roles of State Owned Enterprises (SOEs) for private sector growth.
Prime minister during the third meet the press session on March 1 said the board was established around a week ago, considering private sector as an integral part for the development of the country.
He also shared the members of the board are yet to be finalized.
“We heard many times about private sector development, but it seems that nothing much was done for its development. And neither has there been much growth in the sector. When we talk about the private sector, we see only a few private companies. I had a meeting with DHI and they briefed me on how to go about it,” Prime Minister Lotay Tshering said.
He said the government should only carry out projects which the private sector cannot undertake. However, he added strategic minerals should only be in the hands of the government for sustainable management.
“Mining should not be exploited only for the present generation. Some minerals should be saved for future generations as well. So, we are hoping that strategic minerals continue to be managed by the government,” he said.
However, the Prime Minister said, the private sector can do better in terms of profit making compared to the government and that will actually help with the country’s revenue through taxation.
”They would do better in profit maximization and we are thinking of creating more opportunities for the private sector. So, we are in the process of introducing a private sector policy as well as review the taxation policy to make a more efficient system. If taxation policy is reviewed, it will definitely benefit the private sector,” Prime Minister Lotay Tshering said.
He also informed the media that the government does not have any plans to establish any new state-owned enterprise.
As per the World Bank’s Bhutan Development Report, private sector development in the country has been hindered by the existence of a large number of SOEs and investments in the hydropower sector.
The report also found strong linkages exist between policy makers and managers of SOEs which inhibit level playing field and discourage private sector investment.
The report in its recommendations, calls for the government to formulate a state-owned enterprise policy to redefine the role of SOEs to enable private sector development.