Bhutan has long argued that a country’s progress cannot be understood through economic growth alone. Now, the Himalayan nation is extending that idea to the way it measures its economy — by calculating the economic contribution of nature itself.
Bhutan has become the first country to adopt Gross Ecosystem Product (GEP) as a national-level measure, assigning monetary value to the services generated by its forests, rivers, soils and other natural landscapes.
Prime Minister Tshering Tobgay announced in New York during Climate Week and the Science Summit 2026 that Bhutan’s GEP was estimated at approximately $6.2 billion in 2024.
The new measure is intended to sit alongside Gross Domestic Product rather than replace it. While GDP records the market value of goods and services produced within an economy, GEP attempts to capture benefits that conventional economic accounts can struggle to reflect — even when they are essential to economic activity and everyday life.
Healthy forests, for instance, store carbon and help regulate water systems. Rivers provide water for households, agriculture and other economic activities, while functioning soils support food production. Landscapes and ecosystems provide a range of other services on which communities and businesses depend.
GEP seeks to translate such contributions into economic terms, allowing natural assets to become more visible in decisions about development, infrastructure and investment.
According to Bhutan’s Prime Minister’s Office, the country’s GEP accounts have been designed to complement GDP and inform sustainable development, investment and climate-resilience planning.
The approach has particular significance for Bhutan, where environmental conservation has for decades formed part of the country’s broader development philosophy.
Its Gross National Happiness framework famously looks beyond conventional economic indicators and places environmental protection alongside economic and social wellbeing. GEP takes a related idea into the field of national accounting: if ecosystems contribute to prosperity, their contribution should also be measured.
That question is becoming increasingly important as environmental degradation and climate change expose the economic dependence of countries on natural systems.
Across the world, biodiversity loss, shifting weather patterns, retreating glaciers and increasingly damaging climate-related events are placing ecosystems under pressure. The consequences are not confined to the environment. Damage to natural systems can eventually affect food production, water availability, infrastructure, livelihoods and public finances.
For a mountainous country such as Bhutan, those connections are particularly consequential. Changes in glaciers and water systems can have repercussions downstream, while the condition of forests and other ecosystems can influence agriculture, communities and economic activity.
Putting an economic value on ecosystem services could therefore provide policymakers with another tool for weighing the costs and benefits of development choices.
It also introduces a broader question into economic policymaking. Instead of looking only at how much wealth an economy produces in a given year, GEP asks policymakers to consider the value generated by the natural assets supporting that production — and whether those assets are being preserved or depleted over time.
Bhutan developed its GEP accounts in collaboration with the Natural Capital Alliance at Stanford University, with support from the Enlight Foundation.
The country’s work on natural-capital accounting also received recognition at the New York launch, where Bhutan’s National Statistics Bureau was awarded the 2026 Natural Capital Young Leaders Prize.
The more difficult test will be what happens after the accounting exercise.
Attaching a monetary value to ecosystems does not, by itself, determine how governments should balance conservation against competing demands for infrastructure, industry or development. But it can change the information available when those choices are made.
A forest that appears in conventional accounts primarily when timber is harvested, for example, can look different when its continuing contribution to carbon storage, water regulation and other ecosystem services is also recognised.
That is the shift Bhutan is attempting to make.
GDP answers one of the central questions of economics: how much did an economy produce? By introducing GEP into its national accounting framework, Bhutan is adding another: how much value did nature provide while that production took place?
For a country whose mountains, forests and rivers have always been closely tied to its economy and way of life, the answer will no longer remain outside the balance sheet.
