Domestic airline Villa Air Flyme has announced plans to suspend its operations due to the impact of the novel coronavirus pandemic.

In a circular sent to clients, Villa Air Managing Director Abdulla Nashid said all operations will be suspended indefinitely from Sunday.

However, aircraft and crew will be on standby at all times for charters and emergency flights, he said.

“We are more than confident that by working together with our clients, we will emerge stronger as we had successfully done so in the past,” the circular read.

Nashid assured his clients that Villa Air will be using the lull “to further enhance its services and efficiency for its passengers and clients”. Passengers can also expect “a number of surprises” in the fourth quarter of the year, he said.

“… [We] will be utilising this period to work on these plans,” the circular read.

Flyme, part of the Villa Group of Companies owned by local business tycoon Gasim Ibrahim, had its maiden flight on October 1, 2011 between Velana International Airport and Villa Air’s own domestic airport on the island of Maamigili in Alif Dhaal atoll.

The airline currently operates daily flights between Male and Maamigili, and serves another nine domestic airports across the archipelago with weekly services. In addition to catering to locals, Flyme carries tourists to the resorts in Alif Dhaal atoll, including Villa’s own Holiday Island Resort and Sun Island Resort and Spa.

The airline had in November welcomed a brand new 72-seat ATR 72-600 aircraft, expanding its fleet to three.

Villa Air’s announcement comes a week after another domestic airline, Manta Air, scaled back its operations due to the impact of the Covid-19 pandemic.

On March 8, Maldives reported its first cases of the novel coronavirus, as two hotel employees tested positive for Covid-19 at a luxury resort in the archipelago.

Twelve more cases — all foreigners working or staying resorts and liveaboard vessels except one Maldivian who had returned from the United Kingdom — were later identified.

However, nine out of the 14 have made full recoveries, whilst the rest are being treated at designated quarantine facilities.

The Maldives announced a state of public health emergency on March 12, the first such declaration under a recent public health protection law.

The public health emergency declaration has allowed the government to introduce a series of unprecedented restrictive and social distancing measures, including a ban on inter-island travel of tourists, including for excursions and between resort islands.

A nationwide shut down of all guesthouses and city hotels has also been ordered. Spa facilities located on inhabited islands have also been closed.

A blanket suspension of on-arrival visa was also imposed on Friday.

Even before the on-arrival visa suspension, the Maldives had closed its borders to arrivals from some of the worst-hit countries, including mainland China, Italy, Bangladesh, Iran, Spain, the United Kingdom, Malaysia and Sri Lanka. Visitors from three regions of Germany (Bavaria, North Rhine-Westphalia and Baden-Württemberg), two regions of France (Île-de-France and Grand Est) and two regions of South Korea were also banned from entering the country.

All direct flights to and from China, Italy, South Korea and Iran were also cancelled.

Cruise ships and foreign yachts were also banned from docking at any of the country’s ports.

The Covid-19 outbreak has hit the Maldivian economy hard, as travel restrictions and other preventive measures affect the country’s lucrative tourism industry, which contributes the bulk of the island nation’s state revenue and foreign reserves.

Before the pandemic, the government had been bullish about tourism prospects, targeting two million, high-spending holidaymakers this year after last year’s record 1.7 million.

However, tourist arrivals saw a year-over-year decline of 22.8 per cent in the first 10 days of this month. With arrival numbers falling, several resorts across the Maldives had been closed.

Tourism has been the bedrock of the Maldives’ economic success. The $5 billion-dollar economy grew by 6.7 per cent in 2018 with tourism generating 60 per cent of foreign income.

However, the government is at present projecting a possible 5.6 per cent economic contraction this year — an estimated $446 million hit.

The government has launched an emergency MVR 2.5 billion ($161.84 million) facility and a package of financial measures to shore up the local economy against the coronavirus pandemic.

The MVR 2.5 billion stimulus plan includes MVR 1.55 billion ($100 million) in emergency loans for businesses to meet short-term working capital needs.

The emergency facility is complemented by a package of financial measures, including a six-month moratorium on principal and interest repayments for personal and business loans sanctioned by commercial banks.

Meanwhile, Bank of Maldives (BML) has announced a $2 million short-term financing facility for the tourism industry.

The facility by the country’s largest bank allows operational resorts and guesthouses finance up to $2 million to manage their working capital requirements, with a repayment period of three years.