Shangri-La Hotels and Resorts is closing its only island resort in the Maldives indefinitely.

In a memo seen by several local media outlets, Rahim Flynn, the General Manager at Shangri-La’s Villingili Resort & Spa, told his staff that the owners and management were unable to find any way to restart operations after the suspension of operations in April in the wake of the coronavirus pandemic.

The resort will cease its operations indefinitely and all employees, except a few needed for the general upkeep of the property, will be made redundant, he added.

“This was a difficult decision,” the memo read.

Perched on its own private island in the heart shaped Addu atoll, Shangri-La’s Villingili Resort & Spa is a tropical sanctuary south of the equator. An exclusive all-villa hideaway with endless recreational activities, unforgettable dining experiences and a spectacular nine-hole golf course, there’s adventures to be had on every corner of the island.

Major blow to tourism in south

Despite several new resort developments and a boom in guesthouse tourism in the Maldives, Addu as a whole has lagged behind for years in attracting tourism-related investments.

Up until recently, the relatively large atoll, which has unique geographical features compared to other parts of the island nation, was home to only two of the some 140 tourist resorts in the Maldives; Shangri-La’s Villingili Resort and Spa, and Canareef Resort Maldives.

South Palm Resort Maldives, a brand new property developed on the uninhabited island of Ismehela Hera, opened late last year.

The closure of Shangri-La’s Villingili Resort and Spa comes months after Canareef Resort Maldives made a similar move.

This leaves South Palm Resort Maldives as the only operational island resort in the southernmost atoll.

Unprecedented crisis

The Maldives reopened its borders on July 15.

With the border reopening, 30-day free on-arrival visa is issued to all tourists who has a confirmed booking for a stay at any registered tourist facility in the country. The entire holiday has to be booked at a single facility except for transit arrangements.

There is no mandatory quarantine or testing on arrival. Tourists have to complete a health declaration form only.

But visitors with symptoms of the Covid-19 respiratory disease caused by the novel coronavirus or those travelling with someone who has similar symptoms are tested at their own expense.

The coronavirus 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, only 382,760 tourists visited the Maldives before the country closed its borders on March 27. It was a 40.8 per cent decline over the 646,092 that visited the Maldives from January to March last year.

Meanwhile, the government’s best case scenario now puts total tourist arrivals for 2020 just above 800,000. 

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 13 per cent economic contraction this year — an estimated $778 million hit.

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.

Eighteen more cases — all foreigners working or staying resorts and liveaboard vessels except five Maldivians who had returned from abroad — were later identified.

A six-case cluster of locals, detected in capital Male on April 15, confirmed community transmission of the coronavirus. Several more clusters have since been identified, bringing the total number of confirmed case in the Maldives to 7,047.

Twenty-eight deaths have been reported, while 4,439 have made full recoveries.

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 allowed the government to introduce a series of unprecedented restrictive and social distancing measures, including stay-at-home orders in capital Male and its suburbs, a ban on inter-island transport and public gatherings across the country, and a nationwide closing of government offices, schools, colleges and universities.

Non-essential services and public places in the capital such as gyms, cinemas and parks were also shut.

Restaurants and cafes in the capital were asked to stop dine-in service and switch to takeaway and delivery.

A nationwide shutdown of all guesthouses, city hotels and spa facilities located on inhabited islands was also ordered.

The restrictions are now being eased in phases, with the third phase measures now active.