Bhutan's economic sectors are small like the country; the country has limited population, domestic markets, and natural resources. Geographical isolation caused by highly mountainous terrain and political isolation due to a formerly inward-looking society means that the economy's integration into the world economy is minimum. Isolation in combination with previously low levels of education means that a medium and large-scale private sector is almost non-existent. The majority of the monetized economy is dominated by parastatals .
Bhutan's economy is primarily agricultural, mostly subsistence farming, although some export-oriented commercial farming of fruit and spices does exist. Industry is limited to the production of hydro power and basic manufactures. Services to support these sectors are basic. Tourism, whilst small in size, provides a high proportion of the country's foreign exchange.