Maldives to resume island leases to boost tourism in least explored atolls

Maldives has announced plans to resume leasing of islands for resort development, in a bid to boost tourism in atolls with low concentration of tourist facilities.

Local laws allow tourism leases of up to 100 years.

The Tourism Act was amended in 2016 to allow closed bidding for islands for resort development.

However, the new government, which came to power in November, had pledged to scrap the amendment and to issue tourism leases only through open bidding. The new administration also suspended new tourism leases, pending a market analysis and proper evaluations of existing developments.

Tourism minister Ali Waheed told journalists on Tuesday that the market research and evaluations are nearing completion. New leases are expected to be issued through open bidding from July, he said.

Waheed stressed that new leases will focus on boosting tourism in regions where there are fewer developments. The southernmost cities of Addu and Fuvahmulah as well as the central atoll of Laamu are some of the focus areas, he added.

“Male zone is already flooded. With ongoing developments, the number of beds in this zone is expected to reach 10,000. We’ve an electoral pledge to develop 2,000 beds in the central zone. We expect these new leases to help us achieve that target and push the number of beds in other zones to 10,000 as well,” the minister said.

“Extensive deliberations will be held at the economic council before finalising these plans. Our model is sustainable tourism.”

Official figures show that 144 resorts, 12 hotels, 508 guesthouses and 148 liveaboard vessels are registered in the Maldives. The number of registered travel agencies and dive schools stand at 308 and 272 respectively.

Government had earlier said that a total of 132 tourism projects involving 140 islands are being carried out across the Maldives.

The new government had also ramped up tourism promotion with new initiatives and more funding.

Authorities have come under fire from private organisations representing industry stakeholders such as the Maldives Association of Travel Agents and Tour Operators (MATATO) over the lack of effort and budget to promote the Maldives as a destination.

These concerns come as the world-famous holiday destination struggles to match demand with a rapid increase in bed capacity.

Over the past few years, dozens of uninhabited islands have been leased to local and foreign resort developers. Several international brands have entered into the market, increasing the number of resorts in operation to more than 130. That number is set to increase as another 20 resorts are expected to open over the next two years.

Singapore’s Park Hotel Group has opened its first resort in the Maldives, while major international hotel chains such as AccorHotels have entered the Maldives with four openings, including Mercure Maldives Kooddoo ResortFairmont Maldives Sirru Fen FushiMӧvenpick Resort Kuredhivaru Maldives and Raffles Maldives Meradhoo as well as two in the pipeline. Brands like Hard Rock InternationalCapella Hotel GroupCarlson Rezidor Hotel GroupEmaar Hospitality GroupBaglioni HotelsEmerald Collection and Meliá Hotels International have announced their entry to the Maldives as well.

Existing international players are also upping their presence, with Marriott International launching Westin and JW Marriott in Maldives, Hilton Worldwide re-introducing its top-end luxury brand Waldorf Astoria, Aitken Spence introducing its Heritance brand, Minor Hotel Group introducing its AVANI brand, Onyx Hospitality Group introducing its OZO brand with its second property in the island nation, and LUX* Hotels & Resorts opening its second resort in the Maldives. Centara Hotels and Resorts has also signed a management agreement for its third resort in the tropical destination, while The Residence by Cenizaro has announced the launch of its second Maldivian property.

Leading local hotel groups, including Atmosphere Hotels and ResortsSun Siyam Resorts, and Crown and Champa Resorts, are also on an expansion drive.

Meanwhile, the first integrated tourism developments in the Maldives — Emboodhoo Lagoon project and Rah Falhu Huraa lagoon project — are underway.

Along with the new resort openings come the challenge of increasing demand from budget travellers who choose guesthouses over luxury resorts that the Maldives is known for. The guesthouse sector has rapidly expanded with over 400 guesthouses in operation today.

Maldives welcomed a record 1.4 million tourists in 2018 — a 6.8 per cent increase from the 1,389,542 tourists that chose to holiday in the Maldives in 2017. Other factors such as average duration of stay, bed nights and occupancy also posted positive growth in 2018.

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