Business as usual at Maldives guest-houses after authorities issue “cautionary circular”

The government has insisted city hotels and guest-houses established on the Maldives’ inhabited islands remain open today, after a local media report suggested authorities had revoked the right of local councils to operate tourist properties on their land.

Sun Online reported yesterday that the opposition Maldivian Democratic Party (MDP) had called for an emergency debate in the people’s Majlis against an “order” by the Ministry of Tourism, Arts and Culture to cease the “operation of guest houses and hotels”.

MDP Chairperson and MP Reeko Moosa Manik was reported to have criticised the legality of an order issued on June 17, claiming the motion was a means to protect the interests of certain resort owners at the expense of developing independent travel.  Manik was unable to respond to Minivan News at the time of press.

Responding today to the Sun Online report, tourism authorities said there had appeared to be “confusion” about the content of a circular that as released by the ministry on June 17.

While not having seen the circular, former Tourism Minister Dr Mariyam Zulfa said she did have concerns about the government’s attitude to guest-house development, alleging that authorities sought to reverse previous state commitments to decentralise powers to local councils. She claimed these powers allowed councils – in collaboration with the government – to have more of a say in localised tourist developments.


Deputy Tourism Minister Mohamed Maleeh Jamal claimed the ministry has issued a circular to make local councils aware that the allocation of public land for tourism development was to be approved by the ministry and not themselves.

“This circular from the ministry never mentioned guest houses or city hotels directly. Some local councils are allocating land for tourism developments like guest-houses,” he said.

According to Maleeh, the circular was devised as a “cautionary” response to ensure local councils only set aside land for hotels and guests-houses under license from the Tourism Ministry.  Maleeh contended this provision would ensure industry planning and safety standards were met.

“There appears to have been some confusion about the motion. Right now, any person can develop guest houses or hotels on private land,” he said. “To do this, they are required to go through the Tourism Ministry and follow regulations regarding safety and the number of rooms they are operating.  This is simply a circular to remind local councils that public land can’t be assigned by them for guest-house development.”

Maleeh claimed that all land being set aside for tourism development was required to go through a bidding process before gaining government approval.

Guest-house challenges

Just last week, Minivan News’ spin-off travel review site, Dhonisaurus, reported on the challenges facing the development of independent travel in the Maldives through industries like guest-houses.

Tourism Minister Ahmed Adheeb said at the time that the government was presently analysing the contribution to the economy of all tourist properties – including resorts, safari boats and guest-houses. Once this analysis was complete, the Tourism Ministry said it would then unveil how each sector will be developed though the country’s fourth tourism master-plan.

Speaking today, Deputy Minister Maleeh stressed that the country’s resort industry presently accounted for about 80 per cents of the total bed capacity available to tourists.

While guest-houses were estimated to account for 2.5 percent of tourism bed capacity, Maleeh claimed that the industry was “slowly picking up” – something that would be considered within the news tourism “master-plan”.

“Properties like guest-houses allow tourists to experience local culture here, there will definitely be a role for them,” he said. “However, the government wants to make sure these are successful ventures, but there may be issues to overcome for such properties. This is why the license to operate them must come from the tourism industry.”

“Running as normal”

One local operator of guest houses, who wished to remain unidentified, said that there has so far been no impacts on their business resulting from the tourism ministry circular.  The operator told Minivan News that an official tourism ministry inspection had been carried out last Wednesday (June 20) on a soon to be opened guest-house property, and there had been no indication of a change to their operations.

“As far as I’m aware, business is running as normal,” the spokesperson said.

Dr Mariyam Zulfa, who served as Tourism Minister under the administration of former President Mohamed Nasheed until February’s controversial transfer of power, has however raised concerns that the circular could place a barrier on future hotel and guest-house developments on inhabited islands.

Zulfa stressed that while she had not seen the circular, from what she could gather, the circular highlighted a government policy now seemingly against granting permission for new guest-house properties.

“I take it to mean that the circular will place a bar on further local tourism development by usurping the power of local councils,” she said.

“During my time, we worked to try and empower local councils through a land use plan to take more responsibility for local tourism development. They still had to come back to the Tourism Ministry and obtain an opening permit for any property, but we wanted to give councils power to decide how to move forward.”

Land use plan

With all land allocation related to tourism development requiring presidential approval, Zulfa said that the previous government held a policy where every island in the country was required to have a land use plan approved by the Housing Ministry.

Zulfa claimed that on islands where land had been earmarked for tourism developments under this land use plan, any person with a business proposal for a guest-house or hotel could then go to their council for approval.

“The idea was that local government would have the authority to negotiate with local developers for the best deal for their communities,” she added. “The ministry would also be able to provide assistance if needed.”

Zulfa added that she found it “strange” that opponents of the former government had alleged the administration had been doing “whatever it pleased” in terms of distributing land.

“If we look as the islands set aside for resort development at the time, there was a US$600,000 charge per square hectare of land – an amount that was very close to previous investment regulations.

Zulfa added that the “significant” sum was devised after a tender process and consultation with the industry to ensure committed investors were being found to help fund developments.

“It seems strange to me that people are making it seem like we were giving away islands, when we had undertaken immense work and spent significant time in outlining these plans,” she added.

Earlier this month, the government refuted claims it had considered halting the lease of 60 islands awarded for resort development by the Nasheed administration.

Critics alleged that the CSR programme was against the law as the islands were awarded in the absence of an open bidding system, and had favoured MDP members.


2 thoughts on “Business as usual at Maldives guest-houses after authorities issue “cautionary circular””

  1. Biz as usual ?
    British friend went (repeater) to same guesthouse in Male'.
    Before he would be charged 650 MRF.
    Now he was charged 950 MRF, explained as "GST".


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