Paper short abstract:

This paper critically examines the tourism expansionist McKinsey Report (2010), which aimed for 100,000 tourists by 2012. The findings revealed discords that compromised the GNH principles. The environmental and socio-cultural integrity was impacted despite economic advancement.

Paper long abstract:

Bhutan's pristine natural environment, its Mahayana Buddhist culture, and the notion of Gross National Happiness (GNH) has attracted increasing numbers of international tourists to this small Himalayan Kingdom, better known as the 'last Shangri-la', despite its comparatively high tourist tariff system. The aim of this paper is to critically examine the impacts of the McKinsey Report (2010), a tourism expansionist policy based on the notion of 'high value, low impact', which was targeted to increase international tourist numbers to 100,000 by 2012. This target has significantly impacted on Bhutan's limited resources and contravenes the GNH Tourism Model founded on the four GNH pillars: the preservation and conservation of the environment; cultivation and promotion of culture; good governance, and equitable and sustainable socio-economic development. Foucault's (1978) theoretical framework of 'governmentality', is used to explain the socio-cultural realities of the GNH tourism model. A qualitative methodology of document analysis, participant observation, and semi-structured in-depth interviews of tourism stakeholders has been used. The interview data was analysed using the NVivo10 software program. The findings revealed discord amongst tourism stakeholders over the implementation of the McKinsey Report recommendations. Whilst there was an increase in national economic benefits, the environmental and socio-cultural integrity of Bhutan was adversely impacted, thereby compromising the GNH principles. This has resulted in a paradox in the GNH tourism model: 'low value, high impact, high volume'.