Maldives announces halal tourism push, to develop two Muslim-friendly resorts

Maldives has announced plans to develop facilities to tap into the halal tourism market, with at least two dedicated Islamic tourist facilities to be developed over the next three years.

In its Strategic Action Plan 2019-2023 released last week, the island nation’s government had specified developing facilities to tap into the halal tourism market as a key goal in its tourism diversification plans.

Under the plan, the tourism ministry is tasked to liaise with the Islamic ministry and the Attorney General’s Office to formulate the necessary policies, rules and regulations by the end of 2020.

By the end of next year, the tourism ministry will also work with the economic ministry to attract investors to develop halal tourism in the Maldives.

Over the coming year, the ministries of tourism, finance and national planning will also collaborate on identifying a specific island for halal tourism and allocate at least one island for the purpose in the bidding process of tourism islands.

The tourism ministry will also lead the facilitation of an understanding between banks and the economic ministry to introduce new Shari’a compliant finance schemes by the end of 2021 for the development of halal tourism.

Middle East, especially United Arab Emirates and Saudi Arabia, holds much potential for the Maldives’ tourism industry.

In 2018, a total of 52,114 tourists from the region visited the Maldives. From January to August 2019, 42,774) tourists visited the Maldives from the Middle East region — a growth of 14.9 per cent compared to the same period last year.

However, the Maldives does not have dedicated halal tourist facilities.

Local company ADK had earlier tried to develop a halal resort on the island of Gaakoshibee in the northern Shaviyani atoll.

However, the plan later fell through and the island was later sold to Singapore-based SC Capital Partners Group. The island is now home to the Fairmont Maldives Sirru Fen Fushi resort.

In 2016, the state-owned Maldives Centre for Islamic Finance (MCIF) also announced plans to develop a halal resort. However, the plans have not yet materialised.

The Muslim travel market is continuing to be one of the fastest growing sectors in the world. In 2018, there were an estimated 140 Muslim visitors worldwide — up from 131 million in 2017.

In a report titled, “Halal Travellers 2016”, by the consulting firm Amadeus, it is forecasted that halal tourism will expand 50 per cent in terms of volume, and 35 per cent in terms of value over the next five years. It is estimated that with a CAGR of nine per cent Muslim spending on halal tourism will hit USD 283 billion by 2022.

The latest announcement by the government is part of the Maldives’ plans to diversify its multi-billion-dollar tourism industry, the country’s main economic activity.

The island nation’s official tourism promotion body had earlier announced plans to look beyond the Maldives’ longstanding selling points of ‘Sun, Sand and Sea’ and venture into MICE, cultural and sports tourism.

The Maldives has been known as ‘The Sunny Side of Life’ for decades, owing to its monsoon-based climate, as well as the pristine white sand beaches and clear blue waters.

However, with recent changes in tourist demographics and the introduction of more affordable products such as guesthouses, there is a need to diversify the Maldives’ branding.

The government had earlier said cultural tourism would play an important role in developing the Maldives’ tourism industry. However, a concrete step has yet been taken to realise those objectives.

Maldives has welcomed over a million tourists this year, as the destination attempts to reach an ambitious target of 1.5 million visitors over the next three months.

The one millionth visitor of the year arrived in the Maldives on August 2 — a month ahead of last year. In 2018, the one millionth mark was reached on September 9, whilst it was celebrated in October the previous year.

According to official figures, total arrivals for the past seven months of the year increased by 17.2 per cent to reach 994,733 compared to the same period last year.

Maldives welcomed a record 1.4 million tourists in 2018. It was a 6.8 per cent increase from the 1,389,542 tourists that chose to holiday in the Maldives in 2017.

Meanwhile, government has revised its forecast for the number of tourists visiting the island nation this year, increasing the estimate to a record 1.6 million from 1.5 million.

This positive growth in the tourism industry comes amidst concerns by 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 an increased 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 to more than 130. That number is set to increase as another 20 resorts are expected to open over the next two years.

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 500 guesthouses in operation today.

The previous government announced steps to maintain a structured growth in tourism, including a slowdown in leasing islands for resort development and increased marketing efforts in key markets such as China and the Middle East in order to reach an ambitious target of a record 1.5 million tourist arrivals this year.

Meanwhile, the new government has pledged to ramp up tourism promotion.

Reflecting the new government’s pledge, the state budget for 2019 includes MVR 104,200,000 (USD 6.7 million) for tourism promotion, up from MVR 34,733,333 (USD 2.2 million) this year and the previous year.

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