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Bhutan: The Economic Context
Country Study > Chapter 3 > The Economy > The Economic Context


Bhutan, recognized by international aid agencies as one of the poorest of the least developed countries of the world, had a primarily subsistence agricultural economy in the early 1990s. In the late 1980s, around 95 percent of the work force was involved in the agricultural sector (agriculture, livestock, forestry and logging, and fishing). The government projected that the agriculture sector would produce 46.2 percent of the nation's gross domestic productfor 1991, at US$440.

Despite these seemingly bleak economic indicators, the actual quality of life was comparatively better than that of countries to the north and south. World Bank analysts believed the numbers were low because of inaccurate population estimates and differences in measuring subsistence output and barter transactions, as well as the difficulties in reconciling the differences between fiscal-year and calendar-year accounts. Nutritional intakes, and the availability of housing, land, livestock, and fuel, all pointed to higher per capita income. And, when measured in 1980 constant prices, according to Bhutanese government statistics, the economy experienced a highly respectable .8 percent annual growth rate during the 1980s.

Although Bhutan has a minuscule private sector, it was growing in the late twentieth century in conjunction with government development plans. It was controlled, however, by a small sector of society, members of the royal family, and individuals or families with government ties. The Companies Act of 1989 provided for the separation of all public and joint sector corporations from the civil service by mid-1990, and, as a result, certain key enterprises became independent of the government.

Data as of September 1991

Last Updated: September 1991

Editor's Note: Country Studies included here were published between 1988 and 1998. The Country study for Bhutan was first published in 1991. Where available, the data has been updated through 2008. The date at the bottom of each section will indicate the time period of the data. Information on some countries may no longer be up to date. See the "Research Completed" date at the beginning of each study on the Title Page or the "Data as of" date at the end of each section of text. This information is included due to its comprehensiveness and for historical purposes.

Note that current information from the CIA World Factbook, U.S. Department of State Background Notes, Australia's Department of Foreign Affairs and Trade Country Briefs, the UK's Foreign and Commonwealth Office's Country Profiles, and the World Bank can be found on

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