Posters like these from the United Nations Office on Drugs and Crime are popular in Bhutan, highlighting concrete examples of corruption’s effects on democracy and development.
Bhutan – self-proclaimed “Kingdom of the Thunder Dragon,” one of the world’s newest democracies, and a country fairly high up on the ‘mysterious’ chart. Bhutan has been hidden away from the world nearly since its founding. The establishment of a parliament, the coronation of a new king, and the first-ever elections for the country’s leadership all took place in late 2008. Gradually, Bhutan is becoming more accessible, from an economic perspective, to the world. And yet, even this early in its founding, problems that we see throughout the South Asian region are starting to creep in.
One of the most surprising (to me, at least) is corruption. An early goal of the new king and parliament is to reduce petty corruption throughout the country. Bhutan has approximately 23,000 businesses scattered from Thimphu to Bumthang, and many of these microlevel entrepreneurs already face the demands of tax inspectors with too much discretion. Many of the business owners, while in possession of a basic education, lack formal knowledge or training in accounting or bookkeeping. Bhutan has a strong tradition of oral history, which leads to weak record-keeping, an element easily exploited by local bureaucrats on the make. Additionally, the government writ large has little experience in creating legislation, which leads to a variety of loopholes in tax legislation that leaves local officials a great deal of leeway in establishing a business’ tax liability.
Particularly interesting is the level of recognition of corrupt practices in the country. Shopkeepers say there’s some corruption, but not a great deal. Government officials indicate there is nearly none. To hear the local media tell it, Bhutan’s corruption could put Afghanistan to shame. But there’s a larger problem on the horizon. As citizens in a developing democracy, the Bhutanese people need to believe in the power of representation, rule of law, and market forces. A steady increase in corruption could undermine the people’s faith in their new system of governance. It’s a race against the clock. Here’s hoping Bhutan can overcome the pressures of the outside world in time.
Published Date: February 03, 2010