Discontinued tourism bed tax will cost state 10 percent of revenue

The People’s Majlis’ failure to extend the country’s tourism bed tax before recess will result in losses of MVR100 million a month, the Finance Minister is reported to have told local media.

As of the start of 2014, the tourism bed tax taken under the Maldives Tourism Act of 1999 will be discontinued because of a deadline added to the act during its second amendment in 2010.

Article 35 – D of the amended act states that within three years of taking TGST (Tourism General Services Tax), the US$8 tourism bed tax per person per night shall be discontinued.

As the TGST was introduced with the year 2011, the current deadline came to pass at 12am this morning.

Quoting the Deputy Commissioner General of Maldives Inland Revenue Authority (MIRA) Hassan Zareer ‘Haveeru‘ has reported that this will result in a reduction of MVR1 billion – or ten percent of annual state revenue. He said the issue had been brought to the government’s attention. Minister of Finance Abdulla Jihad was quoted as saying that this change would incur a loss of approximately MVR100 million per month from the state cash flow.

On 9 December 2013 MP Abdul Aziz Jamal Abubakr, proposed an amendment to the act – on behalf of the government – extending the deadline for another year. However, it was not passed when the Majlis went to recess with the final sitting of the third session on 30 December 2013. The next session of the Majlis will begin on 1 March 2014.

MIRA statistics reveal that  from January – November 2013 the tourism tax accounted for 9.6% (MVR787,340,577) of the total revenue collected by the authority. Within the same period tourism land rents contributed 9.8%, and TGST 27.3% of the total revenue.

On 29 December the Majlis passed a MVR17.95 billion (US$1.16 billion) national budget, despite concerns from the public and various organisations. The central bank Maldives Monetary Authority (MMA) warned that if proposed revenue raising measures in it were not implemented, the budget could not cater for even the recurrent expenditure. The authority anticipates that the resulting budget deficit for 2014 could potentially increase from MVR886.6 million to 4.4 billion (11% of GDP).

The International Monetary Fund (IMF) also proposed the implementation of a number of measures to raise revenue and reduce spending.


STO to purchase three resort islands to generate dollars

State Trading Organisation (STO) has announced it will venture into the Maldives tourism industry in order to increase its access to foreign currency.

The STO is the Maldives’ state-owned importer, and is the primary supplier of general goods, fuel and pharmaceuticals to the Maldives. It also supplies aviation fuel to Ibrahim Nasir International Airport (INIA).

STO Managing Director Shahid Ali said the company needed to purchase “at least three resorts and one hotel”, to meet its demand for foreign currency at a time the country was facing a ongoing dollar shortage, according to newspaper Haveeru.

The Maldives grapples with a foreign currency deficit due to a heavy import-export imbalance. Goods from overseas must be purchased with foreign currency, but the Maldives has little ability to earn this outside the resort industry.

The industry typically pays salaries in local currency, while most of the its banking is conducted outside the country in financial hubs such as Singapore. The properties also charge directly in US dollars bypassing the rufiya altogether, a practice which is technically against the country’s monetary legislation but is unenforced by the central bank. As a result, the wider Maldives economy sees little of the dollars that tourists bring into the country, and importers must rely on the fluctuating blackmarket for rufiya-dollar transactions.

“We are trying to a find a way to earn the foreign currency we need without relying on another party for it,” Shahid Ali told Haveeru. “Venturing into the tourism industry is the way to achieve that. We need to own at least three resorts for this,” he said.

The STO board is currently reviewing resort islands for purchase, and a decision is yet to be made on which islands will be bought.

STO Spokesperson Ismail Sadiq had not returned calls at time of press.

The company is currently building a 5-star hotel on  Hulhumale under a contract with USA-based multinational travel company, Carlson Group. The hotel project started in October 2011, although the contract was signed between STO and Carlson in 2008. Shahid said at the time that the delay was due to financial constraints.

The STO was initially formed in 1946 as a fully state-funded business, in the name of Athireemaafannu Trading Agency (ATA), with the task of purchasing and importing essential food items in bulk to be distributed nationally via local traders and their own retail outlets. It was later expanded and rebranded as the State Trading Organisation.

The STO is not the first government entity to venture into the tourism industry. In February 2010 the Maldives Tourism Development Corporation (MTDC) – another public company investing in the tourism industry – paid US$3.5 million to end a long-running court dispute with former management of Herathera, Yacht Tours, after the company stopped paying rent and claimed the MTDC had failed to fulfil a contractual obligation to build a channel between the resort and the adjoining island of Hulhudhoo.

MTDC agreed to pay Yacht Tours the money to end the dispute due to spiraling costs: at one stage, 600 staff had been employed to look after 28 guests.


Maldivian cultural dances to be held at Expo 2012, South Korea

The Maldives will be represented through cultural dances on the big stage at Expo 2012 in South Korea.

An estimated 10 million people from around the world are expected to visit the three-month Expo held in South Korea’s coastal city of Yeosu.

The slogan for this year’s Expo is “The Living Ocean and Coast.” The Maldives’ slogan under this theme is “99% ocean, 1% sand, 100% Maldives”. The Maldives pavillion is designed depicting beautiful underwater scenery and Maldivian culture.

The main focus of the Expo 2012 is on the importance of preserving marine and coastal environments. The exhibition will offer a “golden opportunity for resolving imminent ocean-related problems facing developing countries,” according to the Expo 2012’s official website.

“The Maldives will use the opportunity to gain maximum exposure to potential tourists to the country, in line with the Government’s target of attracting one million tourists to Maldives this year,” said Senior Marketing Officer of the Maldives Marketing and PR Corporation (MMPRC), Fathmath Raheel.

Raheel said the MMPRC has invited local parties interested in selling Maldivian souveniers at the Korean Expo.

“Selling souveniers and authentic Maldivian products will be a very good way to inform people about the Maldives. We will provide assistance to any groups interested in doing this with their own funds at the expo,” Raheel told Minivan News.

The Maldives participation is sponsored by the government of South Korea.

In addition to the cultural dances performed at the Maldives pavillion as well as on the Expo stage, a one-day seminar on the travel trade will be held.

Each of the 104 participating countries will celebrate the National Day of their countries at the Expo. The Maldives’ National Day event will be held on June 4.

South Korea is among the top 10 countries in tourist arrivals to Maldives this year, with 6554 visitors arriving from January to April – growth of 20.9 percent on the same period last year.

“The South Korea market is expected to perform extremely well this year,” the MMPRC observed in its April report. “There is possibility of direct flights from South Korea to the Maldives which would further boost the market.”

Last year the country contributed 2.7 percent of tourist arrivals to Maldives.


INIA remains cheapest airport in region “by half”: Transport Minister

GMR will lower fuel charges by US$0.05 a litre on all domestic flights and raise it the same amount for international flights at Male’s Ibrahim Nasir International Airport (INIA).

Several airlines, including Qatar Airways and Sri Lankan Airlines, have meanwhile voiced concerns over the recent hike in set airport fees including landing and ground handling charges.

In response, the Transport Ministry has said that even with price changes INIA remains the cheapest airport in the region “by 60 to 80 percent” – and claims that some airlines have not been paying their dues.

“Doha, Dubai, Tivandrum – while they all charge US$3,000 turn-around fees, Maldives’ INIA was only charging US$1,080,” Transport Minister Adhil Saleem told Minivan News. “Even with a fifty percent increase in fees the total charge of US$1,500 is still half of what is being charged everywhere else in the region.”

Saleem noted that INIA’s rates had not changed since 1994, however in that time salaries had increased four times and development projects had been contracted. He added that the price changes – initiated by Maldives Airlines Companies Limited (MACL) and not GMR – should not have come as a surprise.

“In February 2011 MACL informed all airlines that the rates would increase in November, effectively giving them nine months’ notice. There has been no price change by GMR,” he said.

Yet several carriers including Qatar Airways and Sri Lankan Airlines have expressed concerns over the price changes and suggested they would make changes to their routes, reducing services to the Maldives.

Qatar CEO Akbar Al Bakr last week told Reuters News Agency that the airline was “dismayed” over what it understood to be GMR’s plan to increase the handling fee by 51 percent at some future date, and suggested such a move would “threaten Qatar Airways’ continued presence in the Maldives.”

GMR officials are reportedly meeting with CEOs of airlines serving the Maldives. Two airlines contacted by Minivan News did not wish to comment, including Qatar.

“The issue,” Saleem told Minivan News, “is that some airlines have not paid their dues to GMR in nine months. No airport can go on without payment.”

INIA CEO Andrew Harrison later clarified through GMR’s spokesperson that Qatar has an outstanding debt due to its refusal to pay the higher rates. Minivan News understands that GMR has requested Qatar pay cash for today’s flights, while other airlines are in the process of settling their payments with the airport.

Some have suggested that concerns raised by groups such as Qatar also stem from a drop in demand as the low season approaches. Saleem said that Sri Lankan’s strategy had always been to boost tourism numbers in its own turf.

“We believe the London flights were operated for Sri Lanka to achieve its tourism target. They’ve changed their summer schedule to this effect,” he said, explaining that the airline may cut down on direct flights to Maldives as a result, but that this was rather a matter of scheduling.

Responding to  concern that reductions in carrier services would damage the tourism industry, Saleem pointed out that airline changes are a reflection of the already-changing tourism demographic.

Last year Chinese arrivals trumped all other tourist groups to the Maldives, while the Maldives’ traditional European market continued to slump under the West’s ongoing economic pressures.

“It’s a changing world,” Saleem said, noting that local airline Mega Maldives has expressed interest in expanding east to Japan. “The numbers from the East are rising, so it’s possible that the major Western carriers don’t have the demand to continue the same flight frequency that they did before. Singapore will be doubling its flights by 50 percent to 14 flights a week in March,” he said.

GMR spokesman Amir Ali reinforced that concerns over the price hike are misinformed. “There are concerns, but some people are using it in a political game,” he said.

Late in 2011 GMR’s intention to implement a US$25 (Rf385.5) Airport Development Charge (ADC) was blocked by the Civil Court, while minority opposition Dhivehi Quamee Party (DQP) campaigned against the industrial giant with a booklet titled “Handing the Airport to GMR: The Beginning of Slavery.” The government has since appealed the court’s decision, stating that it is obliged to honor its contractual relationship with GMR.

Maldives Association of Tourism Industry (MATI) Secretary General ‘Sim’ Mohamed Ibrahim agrees that INIA’s rates have been remarkably cheap for the region, but believes that the price hike – and ensuing negotiations with airlines – are a delicate business.

Although GMR “inherited” the current change in prices from MACL, “GMR’s strategy is to make as much money as possible any way they can – that’s business. But if it’s not done right then it’s not going to work. This has been too much, too fast,” Sim claimed.

According to Sim, the two overarching issues are the pace and method of the price hike. Rather than raising set fees dramatically during the high season, Sim suggests introducing the change in phases. He also recommends requesting payment post-service.

“In Singapore people are charged after they’ve seen the development and its benefits. People want to see what they are paying for, and it seems to be working alright,” he observed.

Pointing to the Maldives’ limited economy, Sim said airport development and fees “have to be weighed with the reality that the Maldives is totally dependent on tourism.”

Minister Saleem offered assurances that the Maldives’ appeal would continue to draw customers. “I’m sure there will be other airlines wanting to come in, especially as the demographic shifts,” he said.


Qatar Airways CEO “dismayed” over airport fee hike, GMR denies plans

Qatar Airways CEO Akbar Al Baker has warned that the airline will re-consider flying to the Maldives if airport operator GMR maintains its apparent plan to raise airport handling fees at Ibrahim Nasir International Airport (INIA) by 51 percent.

Reuters reported that the airline was “‘dismayed’” over what it understood to be GMR’s plan to increase the handling fee at some future date, and suggested such a move would “threaten Quatar Airways’ continued presence in the Maldives.”

Noting that the Maldives’ economy is based on tourism, Akbar Al Baker called the planned increase “totally unreasonable.”

“If we or any other major player withdraws services because of these unwarranted and draconian measures, it will be the people of the Maldives who will lose out, affecting their livelihoods as they rely heavily on the tourism industry,” he said in a statement released on Wednesday.

“My message to the Maldives authorities is to think rationally about the future prosperity of your tourism industry. These steps may have not been thought through seriously by the airport operator and I urge them to think again.”

GMR spokesman Amir Ali said that the fee hike had already been made by the Maldives Airport Company Ltd (MACL) shortly before GMR assumed control of the airport, adding that while there were no plans for a further increase at present, prices were dependent on factors such as fuel prices.

“I believe the fee was increased because of the rise in fuel prices, but I’m not sure since the decision was made by MACL some time ago,” Ali said.

GMR had received no official communication from Qatar Airways, he added.

Since taking over INIA in 2010 GMR has made several adjustments to airport operations in an effort to match the airport’s facilities to those expected by visitors to the country’s upmarket resorts. While progress has been rapid, the local population has also voiced discontent with changes to baggage handling services and departure fees.

GMR was recently challenged in court over its recent attempt to collect an Airport Development Charge (ADC) beginning in 2012, a stipulation which was included in its concession agreement with the government. While the Maldives Civil Court ruled against the ADC in December, the government appealed the case to the High Court, declaring that it was obliged to honor its agreement with the airport developer.


Government agrees to amend GMR fee while rooting for ADC

The government has agreed to deduct expected revenue from the US$25 (Rf385.5) Airport Development Charge that was to be charged from passengers departing on international flights from Ibrahim Nasir International Airport (INIA) from GMR’s concession fee to the Maldives government.

The agreement is subject to change according to a verdict from the High Court in a related case, and the passage of a bill currently before Parliament.

GMR’s request that the amount be deducted from its concession fee to the government was made to Maldives Airports Company Limited (MACL) last week, and approved following discussions between the Finance Ministry and the Maldives Airports Company Limited (MACL).

MACL officials did not respond to phone calls at time of press.

The ADC was to be charged after midnight on January 1, 2012, however the Maldives’ Civil Court blocked the fee on the grounds that it is essentially the same as a pre-existing Airport Services Charge (ASC) of US$18 for foreigners and US$12 for locals above two years of age.

Citing a contractual obligation with GMR, the government subsequently appealed the case to the High Court, where it is currently awaiting a verdict.

Having received nearly 1 million tourist arrivals in 2011, the government and GMR expected the ADC would generate US$25 million in revenue towards the current renovation of INIA.

Although the expected revenue is said to include fees charged from foreigners and Maldivians traveling abroad, it appears that at US$25 apiece the nearly 1 million tourists alone would meet the revenue needs stipulated in GMR’s original agreement.

President’s Office Press Secretary Mohamed Zuhair informed Minivan News that the notion of exempting Maldivians from the ADC had been raised in meetings, but rejected on the grounds that such an exemption would not generate the necessary revenue.

“The government and GMR have calculated to assure that shareholders and banks are properly recompensed,” he explained. “It should be a matter of pride and joy for any Maldivian to help with the development of their airport.”

Economic Development Minister Mahmoud Razee did not believe the deduction of ADC revenue from the concession fee would impact airport development.

“The government agreed to GMR’s request because the numbers were calculated accordingly” to ensure that the project was not compromised, he said.

Razee added that the agreement is only temporary.

“The government is working through the courts and the Majlis [Parliament] to find a resolution,” he said, affirming that the government continues to favor an ADC.

“When the IFC (International Finance Corporation) did the sums it took as part of the income the ADC revenue,” he explained. “Maldives receives a couple million passengers coming and going every year, but if you compare it to a place like Singapore which transits 30 to 40 million passengers a year, and you need to ensure that you are getting an internal rate of return satisfactory to the investor, you need to adjust that rate.

“So we are trying to maintain a good rate of return for the government and the airport,” he explained.

The matter is being addressed at the parliamentary level in an Amendment of Collection of Airport Tax (international travelers) Act 7/78 Bill. However, Parliament is in recess until March.

GMR previously noted that the payment of a development fee was “a common concept in many airports globally”, particularly as a part of concession agreements where airports are privatised.

“The reason for the inclusion of ADC in many global concession agreements is to address the funding needs to meet the investment model required to upgrade and develop new airport facilities at significant costs,” GMR stated.

The company further claimed that the charge was included in the concession fee proposed between GMR and the government in 2010.

Speaking at the groundbreaking ceremony for INIA’s new terminal on December 19, President Nasheed said he wished to assure GMR that the government was “200 percent behind your contract, and every single other contract the government has signed with any other foreign party in this country. Not just contracts signed by our government, but also contracts that any ruler of the Maldives has signed with any party. We will honour it.”

GMR’s 25 year concession agreement to construct and manage a new US$400 million terminal (to be competed in 2014) is the single largest foreign investment in the history of the Maldives.

Meanwhile, in April India’s Supreme Court ruled against the charging of airport development fees which are not approved by India’s Airport Economic Regulatory Authority (AERA). However Delhi airport, developed by GMR, continued to charge the fee as GMR had obtained permission to collect the sum in 2010.


French tourist found dead near Paradise Island Resort

A French tourist, identified as 49 year-old Alan Marshall, has been found dead near Paradise Island Resort this morning.

Marshall went missing during a late afternoon swim on January 7.

Marshall was vacationing on Club Med Kanifinolhu resort with his wife, daughter and son-in-law since last week. The family was due to leave the Maldives on January 12.

Kahifinolhu General Affairs Manager Abdu Samad said the victim had been snorkeling off the northern end of Kanifinolhu when he went missing around 4:30 pm. The family immediately reported him to resort staff who launched an investigation with divers.

Police were informed within one hour of Marshall’s disappearance. According to Samad, the search continued through the night until Marshall was found this morning within 30 meters of Paradise Island.

No details have yet been released as to the cause of death. However, police officials today said there was no cause for suspicion of foul play.

Sub-Inspector Ahmed Shiyam said police would “try to find out as much as possible about what happened” during their investigation.

“We have never had an issue with that area of our reef,” said Samad. “It is narrow and there can be a strong current but he was swimming during low tide. We can’t understand what happened.”

According to Samad, Marshall’s son-in-law had spoken with him in the water prior to returning to shore. On the beach, Marshall’s wife inquired after her husband’s whereabouts. Unable to see him, they alerted the resort.

Samad noted that Marshall had said he could swim upon arriving at the resort, however his family confirmed that he had a weak arm. “The investigation will look into any medications he may have been taking,” Samad said.

Marshall’s body has been moved to a mortuary on Male’. Samad expects the investigation to be concluded today, and that the resort is currently arranging to transport the family and the body to Sri Lanka. “There they can arrange for a proper autopsy or a cremation. We are also looking into their transport back to France,” Samad said.


Comment: Extreme times…extreme measures?

Are you familiar with the game of ‘chicken’? It’s when two testosterone (and probably alcohol) fueled teenagers, egged on by their often scheming and cowardly friends, challenge each other to get into a car and drive towards themselves at high-speeds to see who will back-down or steer-away from certain collision and probably death. The first person to do so is then regarded as a ‘chicken’, with subsequent consequences on pride, relationships and social standing.

Over the last fortnight in the Maldives, we are witnessing the silliest, but most high stakes game of chicken being played by politicians who really should know better. From both sides of the political spectrum, rational individuals who should know better are getting into their respective cars – that on which the entire country relies on – and simply revving up their engines and let go of the brake.

By their side, we have the bearded Islamists, egging them on and waiting for the entire foundations of the Maldivian economy to self-destruct – so that the atoll caliphate can be reborn in all its glory.

In the old days (i.e. the time right after Maumoon forgot his criticism of Nasir for allowing alcohol to be sold), we were told that a central tenet of islam was : to each, his own. If you wanted to be a Christian, Buddhist, Shinto, Scientologist – that was your right and we will not try to change that. It conveniently allowed an ideological space for our tourism sector to grow.

However, according to the new religious authorities of the Maldives, this is no longer the case. A Maldivian economy that relies on the money of Kafir’s drinking and sleeping with their unmarried partners in our hotel rooms is hypocritical and should be overthrown.

These are extreme times we are living in. However, it is perhaps becoming slowly but abundantly clear that the existing status quo is slowly disintegrating. History has shown that when there are two parties of people living on the same area with wildly different ideas of what society should be like – the only sad solution is separation. Think India and Pakistan, West and East Germany, North and South Korea, South and North Sudan…etc.

Or perhaps take a more domestic metaphor – for many years, the relationship between the tourism industry and moderate Islam in general, and the firebrand conservatism of the current Islam in the Maldives, was like a marriage of convenience. Like any partners in a marriage, they each had their idiosyncrasies. However, for the sake of a young growing nation, both sides simply put their differences aside and tried to work it out. Today, both sides argue that the other are simply not playing fair and making unreasonable demands on each other. For the sake of the children (and future generations), isn’t it time now to consider a divorce and go their own separate ways?

Now, I’m not saying that a separation is not going to be a messy affair – what separation is not? However, in our case, it does not have to be.  The Islamic conservatives do not want to have anything to do with the tourism industry. So naturally Male’ atoll and Ari Atoll will be part of the Liberal Maldives – where most of the existing resort infrastructure are. Male has also been built on money ill-gotten from trading in alcohol, adultery (not all tourists who stay in resorts are married), and generally haram behavior. Every single aspect of the existing economy has been tainted with it, so surely they cannot in good conscience live in Male’.

So for the Islamic conservatives we provide them with a part of the country and call it the Islamic State of Maldives (or the Arabic name for Maldives) – say North or South – they can choose – and they will give up their existing land in Male’ so that people from that part of the country can come and stay there. Now I am not so certain quite what they will base their economy on – but surely they must have ideas (fisheries, agriculture, Islamic banking hub, Islamic tourism) And to be frank, good luck to them. I value diversity, and I hope they are successful and show us an alternative way to live to the western dominated environment destroying globalised economy.

The other part of the country will form the Liberal Democratic Maldives. The nature of that liberal democracy is one that puts individual freedom at heart – and runs an economy on the basis of that. The role that religion plays in this society is clearly complex – as it is in any society. It could be a moderately religious place (i.e. like Malaysia) or it could be one where religion has no place in public life but only in private life. It could for example be a dual economy – where a different set of rules apply to visiting tourists than to locals in terms of what they can and cannot do. Or it could (Allah forbid) be one where people are free to practice whatever religion they please.

As you may be able to tell from my tone, I have a small bias towards the liberal viewpoint and my preference is to live in the LDM. However, I truly and genuinely respect that you may have a conservative viewpoint. Your idea of Islamic banking and Islamic tourism hub may work like a charm – I mean they do say that Europe is now a dead economy. And who knows, as I grow older and as my wife grows uglier, I may be convinced of the joys of a second younger wife – and then, I’ll be on the first boat to your side.

All comment pieces are the sole view of the author and do not reflect the editorial policy of Minivan News. If you would like to write an opinion piece, please send proposals to [email protected]


‘Dolphin Lagoon’ to offer conservation, education, recreation

The government’s decision to lease a lagoon to a dolphin habitation and family recreation project proposed by top tennis player Amir Mansoor will not force the marine creatures into captivity, and will support conservation efforts for one of the ocean’s most personable yet at-risk inhabitants.

On October 4, the Cabinet deliberated on a paper submitted by the Finance Ministry to lease a lagoon, location unspecified, for a dolphin habitation and training center.

While program specifics have not been officially released, an individual who has participated in such programs elsewhere and is familiar with the Maldives’ project informed Minivan News that the lagoon project is as much a conservation effort with educational motives as it is a recreational enterprise.

Correcting local media’s use of the word “trainer”, the source said the project will create “an open water program during which the dolphins will accompany the care takers on daily unstructured excursions,” and defined the role of caretaker as “taking a dog for a walk. This isn’t a Seaworld enterprise, with hoops and balls for public entertainment.”

While the lagoon program does not aim to put dolphins on display for commercial purposes, the source acknowledged that “it is an industry, you can’t deny that. People want to swim with dolphins. But this program is saying, ‘make it sensible.'”

Demonstrations will be offered but sources say they will be educational, not commercial.

“The demonstrations will show what dolphins are capable of, their speed, their use of eco-location, and other details. It will be fun, but education is the goal. Many people don’t know the basic facts of a dolphin’s lifestyle,” said source.

She added that reachout programs will be established with local public schools, handicapped organisations and orphanages.

The site is also being planned as “a place to spend the day,” featuring billiards, table tennis, photography, a restaurant, and play areas. With daily ferries from Male’, the cost will be friendly to locals.

“Above all, we’re trying to offer both locals and expatriates something to do. The dolphin program is a part of this larger recreational plan,” she summarized.

Freedom: the benchmark for success

The dolphin program includes two lagoons: a 1 kilometre living area surrounded by nets and allowing for free flow of water and fish, and a second, much larger area for excursions. The design is intended to simulate a natural habitat.

“The proposed lagoon is the largest for the small number of dolphins that will inhabit it in the world,” said one source. “It’s so spacious that if the dolphins don’t want to participate in an activity or hang around divers, they can just swim off. The philosophy is, ‘we’ll reward what you like, but you ignore what you don’t like’.”

The program follows a blueprint first attempted by the United States Navy in the 1960s. Since then, several conservation-based facilities have opened in the Caribbean with consistent levels of success.

Freedom is a critical benchmark: “Since the dolphins accompany trainers on daily excursions to the open ocean, it is clear to most people that the dolphins are free to leave or choose to return ‘home’,” said Director of Dolphins and Programs for the Curacao Dolphin Academy and President of the Southern Caribbean Cetacean Network (SCCN) George Kieffer.

Dolphins have allegedly exhibited natural behavior in these facilities including hunting, breeding and social ranking.

Though given the option to swim off, sources observe that dolphins willingly return to their enclosed living space when excursions are over. “They like to be intrigued and challenged, so the programs are always offering new exercises. If you were to put dolphins in a lagoon and just feed them, they would be very unhappy. As long as the challenges keep coming, the dolphins appear to be happy.”

“Make it sensible”

While some activists criticise any form of animal captivity, others suggest that open water programs are protecting the dolphin species.

Kieffer said programs similar to that proposed in the Maldives receive significantly less criticism than marine parks or inland aquariums, and nearly all negative claims have been “demonstrably untrue.”

“The success would appear to be measured by all three [existing facilities] having not only self-sustaining breeding populations, but increasing populations,” he said. As these populations surpass facility capacities, others such as the Maldives’ lagoon program are being endorsed.

“Once these animals have been bred and raised in open water programs, they can’t be released into the wild,” said a source familiar with the programs. “It’s better to find a way to keep them healthy. The program in the Maldives is good because these dolphins need a place to go.”

Rather than capture and train indigenous bottlenose dolphins, the Maldives’ lagoon program will import dolphins already bred in similar facilities. The bottlenose does well in human care, said Kieffer, preferring “small numbers within a social group and shallow water. [Maldives’] local dolphins such as the pan-tropical spotted dolphin and the spinner dolphin prefer deep water and hundreds of individuals within a large moving social group.”

Minivan asked Kieffer if the world’s oceans are safe for dolphins.

“Sadly no; they are vulnerable to the swift and diverse pressures human activities are placing on the sea. Dolphins and whales have endured over 50 million years of the ocean’s natural stresses and strains. And now in just the past several decades, our impact on the seas has rendered them fragile.

“Dolphins are a charismatic species that attracts human attention. The popularity of aquariums, zoos, and interactive programs highlights this point. When people have the opportunity to intimately view and interact with dolphins, they have the potential to form a cognitive and emotional connection – one that has the potential to arouse individuals to care for their new-found friends and become involved in marine causes.”

Local objections

Reports of the ‘dolphin lagoon’ were earlier published by local daily Haveeru. Individuals affiliated with the program said responses have not been positive.

Local dive magazine Scuba Tribe subsequently launched a campaign against the dolphin lagoon on social media outlets Facebook and Twitter.

Scuba Tribe’s argument begins by stating that “little is known how this project would proceed.”

“A training center for dolphins or a lagoon where tourists would come up to see them by paying a fee to see them is out of the question as they all can see them in the wild every single day. Local resorts and dive centers have regular dolphin watching cruises that happen on a daily basis,” reports the Scuba Tribe website.

A source familiar with diving practices in the Maldives claimed that many tour boats are not trained to approach dolphins, and that excessive diving in popular sites such as Hanifaru Bay has pushed fish populations away from these locations.

“Tourists can be seen jumping by the dozens into the water, pushing to see the animals,” she said, noting that in August up to 17 boats could be seen at Hanifaru at one time. “This year was really disappointing for diving, because it was out of control. Why aren’t groups like Scuba Tribe worrying about this? Crowding on dive sites, disappearance of species like the whale shark from their favored areas, these are issues that are affecting the natural world and will soon affect the tourism industry as well. Everyone is involved.”

Hanifaru reef became a Marine Protected Area (MPA) in 2009 and a Core Area of the Biosphere Reserve after “intense tourism activities…threatened [the site’s] sustainability.” Activities are now subject to a site management plan.

Dolphins are most challenged by the impact of human activity in their habitat. Pollution, entanglement in fishing gear, collision with boats and unsafe fishing practices are a few examples. Whale and Dolphin Conservation Society cites coastal development, particularly for marine tourism, and chemical pollution as leading threats.

“Dolphins are also killed unintentionally in gill net, drift net, and purse-seine fishing practices around the world,” Kieffer said.

Purse seining, a fishing method whereby a vessel deploys an enormous net to encircle and capture entire schools of fish at once, “is very cost effective but indiscriminate, and generates a large amount of bycatch,” wrote Minivan News in a recent article. The practice is allegedly done in waters fringing on the Maldives’ national borders. “Nothing escapes,” Solah Mohamed, Head of Production for the Maldives’ Felivaru fish cannery, said of the practice.

Director of environmental NGO Bluepeace Ahmed Ikram said the NGO did not have a position on the lagoon program but was soliciting public opinion.

“We are aware of the project and are publicizing it through Facebook and Twitter to see what the public response is. Then we will analyze and discuss the results in the next week.”

Ikram said that the Maldives’ many environmentally-relevant projects has kept Blue Peace busy and made it difficult to focus on individual projects, such as the lagoon.

“This seems to be part of a progression of projects aimed at eco-tourism which do not quite live up to expectations,” he surmised. “It looks like everything is for sale, and most of it is for tourism.”

The downside of publicity

Publicity is a driving factor in Maldives tourism, however one source suggested that it can be too much.

“National Geographic did a report on Hanifaru Bay, and now tourists are all coming and saying, ‘We want to go to Hanifaru.’ As a result, it became a protected area. To protect the dive site, you have to control traffic.”

In 2009, documentary film “The Cove” turned the international eye on Japan’s dolphin hunting culture and industry. Its implications for dolphin centers have proved damaging.

According to the film, Japanese fishermen entrap dolphins and sell them to international buyers, some of whom work for marine entertainment organisations such as Seaworld. The remaining dolphins are slaughtered and sold as food, often labeled as fish or whale meat, “The Cove” website alleges.

Dolphin meat has been debated as unsafe for human consumption.

A source argues that the film’s implication that dolphin centers around the world cooperate with the Japanese industry is inaccurate and harmful to legitimate conservation programs.

“Dolphins which are exported or sold for business purposes go through very strict documentation procedures,” she said. “None of the parks in the US, Caribbean or Europe have dolphins that originated in Japan, and they have the proper paperwork to prove it.”

The source added that the film’s message has made dolphin program development more controversial. “If we did import dolphins from Japan, we would be accused of sustaining slaughter,” she said.

Minivan News subsequently learned that the Maldives’ lagoon dolphins will not come from Japan, and will be examined by American scientists to ensure that local wild dolphins are not negatively affected.

Avoiding the tourist trap

Keiffer shared his understanding of the Maldives’ facility with Minivan News: “From what I’ve learned, your local facility will not be a run-of-the-mill tourist trap looking to “cash-in” on dolphin popularity by any means necessary. On the contrary, I believe it is striving to be one of a very few organizations setting the standards by which dolphin display facilities are expected to meet if they truly intend to convey a sense of respect and appreciation for the animals under their care.”

He added that the facility’s success would demand caretakers be able to support the dolphins’ physical and emotional needs.

A local source compared the proposal to other operations. “Dolphins are in appalling conditions in some places. Aquariums, for instance – that’s a real cage. People should be opposing those. But this is a totally different ballgame.”

If approved by the government, the facility is expected to be completed by the end of 2012. An official title has not yet been selected.