GDP growth targeted at 5% by June 2022

Dechen Dolkar

Despite the pandemic, the government aims to achieve 5% economic growth by June this year, according to Economic Affairs Minister Loknath Sharma.

The GDP rate fell to minus 10.08% in 2020, which is the lowest in years.

The economy was recovering from the impact of the pandemic and fared much better in 2021, especially in the second half of 2021. It was getting back on a positive growth trajectory.

Lyonpo Loknath Sharma said the third lockdown in January this year again posed a serious situation for the economy.

Lyonpo said every effort was being made to minimize the damage. “Respective task forces are trying to keep trade flowing and industries functioning to ensure the economy doesn’t shut down while containing the spread of the virus, which could further impact transportation, mobility and the delivery of goods and services,” he said. .

“Disruption to the economy is inevitable, but we must continue to move forward and manage disruption by learning from how change is managed through innovation and the principles of the economy of” gig”.

The hospitality, tourism, entertainment and construction sectors remain continuously impacted during the pandemic.

Lyonpo said that CSI sectors are unable to obtain raw materials in a timely manner, and medium and large industries are affected by the increase in the cost of raw materials, labor and equipment. other associated costs. “The workforce in almost all sectors remains at 40-50%, leading to either loss of production or underutilization of production capacity.”

Export and import during containment

Imports continue to be facilitated at ports of entry despite the challenges of PDM infection. Exports are facilitated and prioritized despite the spread of the virus and its complications to keep the supply chain moving.

Lyonpo said cardamom and tangerine exports were picking up until the recent lockdown. “Every effort is being made by the ministry, respective dzongkhags and working groups in the southern belt to restore and supplement the remaining tangerine exports,” Lyonpo said.

Strategies to revive the economy

The strategies for reorganizing the economy, the minister said, have undergone several revisions and are discussed daily to follow the development of the economic scenario both outside and inside the country. Emphasis has been placed on ensuring easier access to finance, including the working capital modality, so that both small and large businesses recover and stabilize quickly.

Lyonpo said they must also actively pursue ongoing hydroelectric construction, other construction projects and accelerated development of industrial parks to support economic recovery.

Pasakha industries were contributing around Nu 15 billion a year before the pandemic, and even now their products make up the top five export items.

“Based on this success, if the planned manufacturing industries in the Jigmeling and Motanga industrial parks could materialize, we will do well,” Lyonpo said.

In the meantime, the ministry is also ensuring that farmers are provided with assured market access and price support to weather the current difficulties. “We need to make sure the CSI sector maintains and receives all the necessary support,” Lyonpo said.

The best way forward, Lyonpo said, is to embrace technology across all sectors in addition to shifting our goods and services into a digital economy mode, which requires an enormous amount of investment, capacity, skills and time.

“The national export strategy is being updated. We are also updating a medium-term economic strategy shortly to quickly reposition ourselves, Lyonpo said. “Financial institutions are also working on how best to fuel the credit pathway for industrial and economic growth.”

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