Bhutan is increasingly facing significant resource constraints to finance its socio-economic development in the short and medium term with hydropower resources kicking in much later due to prolonged delays in the commissioning of its large hydropower projects, namely Punatsangchhu I (1200 MW) and II (1020 MW). This is further constrained by the prospect of graduation from LDC status in 2024-25 that will significantly reduce the availability of concessional financing that so far has been critical in addressing resource gaps for structural transformation. Moreover, development assistance from its largest partner India for the 12th Plan period (2018-2023) has been maintained at the same level as in the eleventh plan period.
Assistance from other development partners will also likely decline as Bhutan’s per capita income and other social indicators have long crossed thresholds of a low-income and low human development state. The Royal Government of Bhutan (RGoB) issuance of treasury bills and short- term loans from the banks have also come under recent scrutiny as the issuance of T-Bills and short-term debts heightens the related risks of constraining the development of capital markets in the country, volatility in interest rates, asset-liability mismatch, liquidity risks, and limited option to finance specific needs.
To address this resource gaps, the Government has identified the need to look at “innovative financing mechanisms” to help address the resource gaps. Sovereign bond should enable the government to fund public sector borrowing requirements at competitive cost. In 2017, RGOB has requested ESCAP to provide technical assistance in developing sovereign bond market. ESCAP has since been actively engaged in assisting RGoB in developing capital market through various stakeholders’ consultations, capacity building workshops and research product. As a part of ESCAP’s technical assistance to Bhutan, this national workshop aims to engage with the Ministry of Finance and various Government agencies and key stakeholders to help facilitate an issuance of Bhutan’s first sovereign bonds. It will emphasize experiential learning and exchange of information with experts, institutional investors, and private sector investors.
- Opening remarks_Ms. Tientip Subhanij_UNESCAP
- Opening remarks_Mr. Gerald Daly_UNRC
- Opening remarks_Mr. Dasho Nim Dorji_Ministry of Finance of Bhutan
- Session1_Royal Securities Exchange of Bhutan 2019
- Session2&3_Regulatory and Policy Framework to Facilitate the Development of Capital Markets in Bhutan_Mr. Louis Cheng
- Session2_Institutional Framework and Regulatory aspects of Capital Market Development in Bhutan_Mr. Karma Yeshey, MoEA
- Session2_Institutional Framework and Regulatory Aspects_Mr. Sonam Penjor
- Session2_Institutional Framework and Regulatory Aspects_Mr. Tempa
- Session3_Desirable Policy Framework_Ms. C S Agnes Cheng
- Session3_Desirable Policy Framework_Mr. Hauman Yeung
- Session4_Green Bond Market Development and Issuance_Mr. Hauman Yeung
- Session4_Green Bond Market Development and Issuance_Mr. Louis Cheng
- Session4_Inclusive Green Finance_Mr. Dorji Phuntsho
- Session5_Sovereign Bond Market Development: A Progress Review_Mr. Tshering Dorji
- Session6_National Pension and Provident Fund_Ms. Leki Wangmo
- Session6_Druk Holding and Investments_Mr. Chencho T Namgay
- Session6_Sovereign Bond_Mr. Pema Thinley_RICBL
- Session7_Private Investors’ Perspective and Engagement_Mr. Jurmay Chophel
- Session7_Private Investors’ Perspective and Engagement_Mr. Rinchen Dorji, MoF
- Session8_Awakening to the realities of green finance_Mr. David Broadstock
- Session8_Way Forward_Mr. Dorji Phuntsho