In Bhutan, hotels are facing one of their toughest chapters. A three-star property in Thimphu, once designed for international guests, now offers rooms for Nu 2,500 a night with meals—less a strategy, more a necessity. Across the country, certified hotels are grappling with low occupancy, driven by an oversupply of rooms and slower-than-expected tourism recovery.
Since 2019, the number of certified hotels has more than doubled, rising from 160 to nearly 400, with three-star properties making up the largest share. Yet, arrivals remain far below pre-pandemic peaks. In August alone, over 8,600 rooms competed for just 10,000 tourists, leaving many hotels empty even in peak season. For mid-tier hotels, especially those targeting regional visitors, breaking even is increasingly difficult.
The government has stepped in with measures like a moratorium on new hotel loans and a Tourist Registration System, while the Department of Tourism works to balance growth with sustainability. Still, challenges remain—pricing pressures, competition from luxury hotels and homestays, and the persistent issue of “fronting.”
Despite the struggles, hoteliers remain hopeful. With careful policy, sustainable growth, and industry resilience, Bhutan’s hospitality sector can adapt and emerge stronger.
