Opening the invisible hand

Bhutan's ambitious plan to boost its economy with a “mindfulness city”

- BY CHARLIE CAMPBELL/GELEPHU, BHUTAN

THE DRIVE UP TO PHULARI VIEWPOINT SNAKES FOR THREE miles along dirt tracks flanked by flowering pyoli plants and murals of flaming phalluses, a traditional good-luck symbol here in the Himalayan Kingdom of Bhutan. At the summit, the 1,000-sq.-mi. expanse of what will be Gelephu Mindfulness City (GMC) materializes through fluttering prayer flags. To the east, a strip of palm forest has been cleared to extend the domestic airport's stunted runway for international flights. To the west, smoke billows from the chimney of an army-run distillery. Over the horizon lies the Indian state of Assam, where much of the labor and materials to construct the $100 billion new special administrative region will come from.

“Activity at the site is just beginning,” says Dr. Lotay Tshering, a urologist who served as Bhutan's Prime Minister from 2018 to 2023 and is now governor of the GMC. “But progress in the designing phase—planning, negotiations, discussions, exchange of ideas—is happening beyond our expectations.”

Those expectations are nothing less than putting a smile back on the self-styled “happiest place on earth.” In December 2023, Bhutan's King Jigme Khesar Namgyel Wangchuck announced the GMC as part of “wholesale” reforms of the nation's economy to combat challenges such as 29% youth unemployment and a resultant brain drain of talent overseas. In 2023, some 1.5% of the population moved to work and study in Australia alone. Meanwhile, the birth rate has dipped to just 1.4 children per woman, portending a shrinking, aging populace. Compounding matters, tourism, one of the principal revenue sources in this nation of 785,000, was brought to a standstill by the pandemic and still hasn't fully recovered, with just a third as many foreign arrivals in 2023 compared with 2019. One in 8 Bhutanese lives in poverty.