MATATO backs guest house island policy

The Maldives Association of Travel and Tour Operators (MATATO) has endorsed the Thumburi guest house island project, urging its members to take part in the government’s plans.

“MATATO believes this will help target mass charter flights, rather than FIT [Fully Independent Traveller] or small groups, paving the way to bring back major charter operators to the Maldives,” said the group which represents over 50 local travel agents and tour operators.

Only Maldivians will be permitted to invest in such projects, the government has revealed, with priority given to those not yet involved in the industry.

“The concept is similar to the beach lodges in Phuket or Hikkaduwa. Thus, MATATO would like to urge its members to participate in this development opportunity, as it would allow them to grow from mere travel agency businesses to property owners within the process of vertical integration of a travel agency,” read an association press release.

The official launch of the scheme – part of President Abdulla Yameen’s election manifesto – came last week with a call for expressions of interest from small and medium businesses in the Laamu atoll development.

Envisioned as a way to “responsibly diversify the tourism product of the Maldives”, the plans to develop uninhabited guest house islands come after the rapid expansion of guest houses alongside local communities in the past five years.

Some in the industry have, however, questioned the schemes ability to offer the same level of benefit to local economies.

“The association believes this is a good project, worth our attention and promotion, although fine tuning will still be required, as this is a new concept to the Maldives,” said MATATO which also suggested its members could form a consortium for the project.

The Thumburi project will  make land available on the 17 hectare uninhabited island – as well as the linked Hulhiyandhoo island – for investors to develop hotels, a diving school, water sports centres, restaurants and shopping centres, while government owned companies will invest in the island’s basic infrastructure – electricity and sewage.

“Rather than seeking a large scale investment, the current scheme offers smaller investors an opportunity to invest only in specific sub products, or a small block of accommodation similar to that of investing in a guest house,” today’s MATATO press release continued.

Describing the project as “a new concept for a world class brand”, the Thumburi brochure reveals plans for several beach hotels with rooms ranging from US$100-200 – far less than that currently charged by the country’s budget resorts.

The Maldives Marketing and Public Relations Corporation will lead the project and engage with investors who will then market their own products.

Contributing an estimated 80 percent of the Maldives’ GDP and famous worldwide for it’s luxury one island/one resort image, the country’s tourism industry attracted over one million visitors for the first time in 2013.


MACL deny jet terminal outsourcing rumours

Maldives Airports Company Ltd (MACL) CEO Ibrahim ‘Bandhu’ Saleem has denied reports suggesting plans to sell the private jet terminal at Ibrahim Nasir International Airport.

“We are not aware that such discussions have taken place even. Our company has definitely not conferred on selling of the jet terminal or any other business with our share in it,” Saleem told Haveeru.

Saleem’s comments come in response to a press release from tour operators organisation MATATO earlier this month, expressing concern over rumoured plans to outsource both the terminal and aeronautical services facilities.

Saleem said he had no idea where the rumours had come from, though he told Haveeru that discussions at the government level were nothing to do with him.

MACL is a 100 percent state-owned company governed by a Board of Directors appointed by the president of the Maldives.

Prior to MATATO’s statement on June 11, Minivan News had learned that the cabinet’s economic council is currently discussing a deal with billionaire Thai businessman William Heinecke.


MATATO expresses concern over airport outsourcing deal

The Maldives Association of Travel and Tourism Operators (MATATO) has expressed concern regarding rumours that a private Jet terminal and aeronautical services facilities at Malé International Airport will be outsourced exclusively to a foreign company.

“MATATO is very concerned that this will create an unhealthy market structure and put many local companies at risk,” read the statement.

Minivan News has learned that the cabinet’s economic council is currently discussing a deal with billionaire Thai businessman William Heinecke.

American-born Heinecke’s Minor International hospitality chain is reported by Forbes to consist of 1,500 restaurants, 100 hotels, and 250 retail outlets spanning 18 countries – including the Maldives’ Anantara resorts.

MATATO, which represents more than 50 local businesses, revealed that it had been approached by a number of concerned members whom it believed would suffer as a result of such a deal.

“Presently there are many local businesses that act as supervision agents, and ground handlers for the considerable corporate and private jets that visit Maldives year round. Many of these local companies depend solely on the income generated from this business,” read the statement.

The association requested that all stakeholders begin a dialogue that might consider alternative arrangements to an exclusivity deal which it suggests lacks market competition, leading to poor services and “consumer exploitation”.

“The absence of competitive pricing that benefits the consumer, allows companies with exclusivity rights to charge higher prices for services, and inconvenience buyers.”

Following the purchase of both the Maldives’ seaplane operators by US private equity group Blackstone last year, hospitality groups revealed a subsequent raising of prices and reduction of services, reporting a potentially negative impact on industry profitability.

MATATO today argued that the airport deal would “only lead to unnecessary outflow of foreign exchange, loss of job opportunities for locals, a significant amount of control of the local market to foreign bodies, among many other negative factors.”

Alternatives suggested by MATATO was for the current management of the airport – the state-owned Maldives Airports Company Ltd (MACL)  – to retain control and upgrade the facilities itself.

MACL took over management of Ibrahim Nasir International Airport (INIA) following the premature termination of the Indian company GMR’s 25-year concession agreement by the previous government.

Shortly after winning the presidency last year, President Abdulla Yameen pledged to redevelop the airport with new foreign investment, while the government would retain the overall management of the airport.

The expansion of INIA – to accommodate five million passengers per year – subsequently featured among the ‘mega-projects’ presented to international investors during a landmark investment forum held in Singapore in April.

Shortly after the Singapore forum, the Maldivian Democratic Party – in power when the original GMR deal was signed – called for GMR’s reinstatement, vowing to annul any new airport contracts should it return to the power.

GMR’s US$1.4 billion arbitration claim was also concluded in Singapore in April, though the court has yet to announce a verdict.


Introducing rival seaplane operators vital for tourism: MATATO

The Maldives Association for Travel Agents and Tour Operators (MATATO) feels it is imperative that competition be introduced to the country’s seaplane industry to assuage fears that the resulting monopoly has negatively hit tourism.

MATATO President Mohamed Khaleel has alleged that the sale of both Trans Maldivian Airways (TMA) and Maldivian Air Taxi (MAT) to US-based private equity fund Blackstone in February of this year has already led to increased prices for guests and tour operators.

“We need to find a competitor to [Blackstone],” said Khaleel.

The merged company now operates under the TMA brand.

Several major hospitality groups operating in the country wrote to the Maldives Association of Tourism Industry (MATI) in August claiming their “worst fears” were being realised regarding the monopoly on the country’s seaplane services.

“You are of course aware that ‘The Blackstone Group’s’ recent entry into the market has had the effect of eliminating competition and creating a monopoly in the charter seaplane market in the Maldives,” wrote the CEO of a major multinational operating in the Maldives.

“We were concerned from the outset about the potential disruptions this could cause in the market and have been monitoring the situation closely.”

In the letter, the company said it was particularly concerned at several contractual points it alleged were being “forced” upon operators by TMA as a result of the seaplane monopoly.

At time of press, Minivan News was awaiting a response from both Tourism Minister Ahmed Adheeb and TMA  to the allegations raised in the letter.

MATATO concerns

Aside from the impact of the increased costs being passed on to travel agents and consumers, MATATO President Khaleel alleged operators had not been receiving the same levels of support from the seaplane operator under Blackstone in order to promote the industry.

“For instance, we try to run [familiarisation] trips for journalists as part of promotion efforts for the country as a destination, every year in the past we used to get complimentary seaplane services [for promotional purposes],” he stated.

Pointing to key developments in the Maldives business sector in recent years, Khaleel said that introducing competition to the country’s communications and telecoms sector had helped lead to positive changes in price and services since the introduction of private competitors.

He expressed confidence that there was sufficient finance and know-how within the local aviation industry to try and establish a new seaplane operator locally.

Khaleel stressed that although the emergence of a growing number of domestic airports across the country was providing alternative transport options to using seaplanes, the best solution would be to encourage competitive pricing in the market by encouraging competing operators.

“There are multiple people around who can afford this to try and establish fair competition,” he added.

Blackstone “treated us well”: guesthouse operator

Meanwhile, one small hospitality group providing guesthouse accommodation in Noonu Atoll, which has recently renewed an agreement for seaplane services, confirmed it had faced successive rise in costs for the use of seaplane services over the last 12 months for a one way journey from the capital.

A one way seaplane flight to Noonu Atoll per traveller earlier this year rose to US$300 from US$260. The cost per head recently rose again to US$375 under its latest agreement signed within the last month, the operator added.

According to the guesthouse manager, the increased rates had not drastically impacted upon its operations as the property had worked with a specialist European tour operator to bring in groups of travellers – the costs therefore being absorbed into a wider package rate.

Outside of costs, the operator stressed that transport – particularly for the country’s fledgling independent travel market – was a “big issue” for their guesthouse, with the prospect of being priced out of using seaplanes potentially creating long-term difficulties for business.

“We were hoping that they would not raise the seaplane rates too much, and they didn’t,” the guesthouse manager added. “We would have otherwise had to use a recently opened domestic airport nearby, but this would be such a hassle requiring hiring a speedboat for further transportation. [The seaplane] is easy, smooth and elegant for us.”

The operator stressed that, owing to the costs already associated with using seaplanes compared to other forms of transport, its guests usually only took a one-way flight to the property itself with alternative transport arranged by sea as part of the experience.

The guesthouse manager added that seaplanes also gave an additional exotic appeal to the country as a destination, describing one tour operator as being “astonished” after their maiden flight across the country’s skies using the services.

This appeal, the operator argued, was a major additional selling point of the current package offered to guests visiting the Maldives.

“A monopoly makes it much tougher to do business, so in the long-run, I would say it could be a bit scary for the industry,” the manager stated.


Maldives on course to meet million tourist target as political uncertainty dominates global headlines

“The World Tourism Organisation (UNWTO) has said the Maldives will successfully welcome over one million tourists to the country this year, according to Tourism Minister Ahmed Adheeb.

The claims were made as the country’s ongoing political uncertainty comes under intense scrutiny by global media after the country’s judiciary – previously reported as being heavily politicised in a UN-sanctioned investigation – suspended polling scheduled for September 28,” reports Minivan News’ spin-off travel site, Dhonisaurus.

“Tourism Minister Adheeb, speaking after the country officially launched the international celebrations for World Tourism Day on September 27 from Kurumba Island Resort, said that current statistics – backed by the UNWTO – indicated that tourist arrivals would exceed one million visitors during 2013.

The Maldives narrowly missed out on its stated aim of bringing one million visitors to the country last year, citing the impacts of global media covering the controversial change of government, an event which followed a mutiny by sections of the police and military.

The UNWTO launch event was attended by Adheeb, Defence Minister Mohamed Nazim and President Dr Mohamed Waheed, who spoke of the potential dangers the Maldives faced as a result of climate change – not least in terms of issues of water supply.

However, the celebrations, attended by senior UNWTO figures, were overshadowed by international media reports of “political chaos” in the country, and talk of potential disruption to the lucrative resort industry as a result of a 5,000 strong workers’ union pledging prolonged strike action.

The action was pledged in response to a Supreme Court decision on September 23 to indefinitely suspend the ongoing presidential election over allegations of voter irregularity, a decision that sparked global concern from international actors that had praised the voting process earlier this month.

Despite the strike pledge, tourism industry operators speaking to Dhonisaurus – including properties directly linked to presidential candidates placed second and third during voting on September 7 – said it had nonetheless been business as usual for the country’s resorts this week.

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Tourism Ministry revokes permit of tour operator Atoll Paradise over fraud allegations

The Maldives Tourism Ministry has suspended the permit allowing local tour operator Atoll Paradise to take holiday bookings, following allegations the company – now under police investigation – has defrauded customers and international travel agents.

Tourism Ministry Senior Legal Officer Faseeh Zahir told Minivan News that the government had temporarily revoked Atoll Paradise’s licence to operate as a travel agent, and fined the company MVR 1 million (US$65,000).

“We have received several complaints from customers and foreign travel agents in recent months that bookings have been cancelled [by the company], but no refund has been given,” he said. “There are allegations of fraud and of the company not acting according to regulations. This is not just a case of one guest, we have received several complaints.”

Faseeh said that although the company’s permit to operate as a travel agent had been temporarily revoked, Atoll Paradise would still be required to honour all existing bookings.

“However, from today, Atoll Paradise is not allowed to take any new bookings from clients,” he said.

According to Faseeh, the Tourism Ministry has received several complaints of alleged fraud by Atoll Paradise over the last two months as authorities have sought to hold talks with the company.

He said the ministry had noted some “misconduct” by the company and decided based on complaints received to both fine and revoke Atoll Paradise’s permit until all alleged outstanding payments and grievances had been settled.

With the ministry not itself being an investigative authority, Faseeh added that police had also been informed of the Atoll Paradise case.

Police Chief Inspector Hassan Haneef confirmed that an investigation was now expected to begin into the company’s operations following the allegations of fraud.

According to Faseeh, any decision to return Atoll Paradise’s permit would depend on the outcome of the police investigation, as well as whether the company could resolve the complaints against it from clients and travel agents.

Award success

Atoll Paradise is one of the Maldives’ largest locally-owned tour operators, with the company in May winning several accolades including the Maldives’ and Seychelles Leading Tour Operator at the World Travel Awards (WTA) Indian Ocean ceremony.

The company was also awarded the title of the World’s Leading Luxury Boutique Tour Operator at the 2012 WTA ceremony.

Atoll Paradise’s office in Male’ was not responding to calls at time of press. The company had also failed to respond to email enquiries at time of press.

Ministry focus

The Tourism Ministry said today that Atoll Paradise was not the first local tour operator to have its permit revoked by the government over allegations of misconduct.

Ministry Legal Officer Faseeh said that ministry had last year revoked the license of one local operator accused of acting outside the law.

He urged guests intending to book a Maldives holiday through a local operator to be aware of their rights and ensure they had been provided with a booking agreement specifying terms of cancellation. Resort bookings in the luxury honeymoon destination can reach many thousands of dollars.

Faseeh said local tour operators were required to communicate and agree terms for cancelled bookings, as well as communicating them to the client upon confirming a booking.

He added that guests wishing to seek clarification on a booking or travel agency could directly contact the ministry or industry body, such as the Maldives Association of Travel Agents and Tour Operators (MATATO), via e-mail.

Any complaints against a tour operator could meanwhile be registered through the Tourism Ministry’s website here.


MATATO complains tourism not included in Islamic Ministry’s blessings during Friday prayer

The Maldives Association of Travel Agents and Tour Operators (MATATO) has written to the Islamic Ministry expressing concern that tourism was not among those industry sectors blessed during Friday prayers.

MATATO President Mohamed Khaleel confirmed to Minivan News that a letter had been sent to the Islamic Ministry yesterday (May 29) expressing concern that the country’s farming and fishing industries continued to be blessed following Friday prayers, while tourism sector had not received the same courtesy.

Under the country’s laws, traditional holiday staples such as the sale and consumption of alcohol and pork products, and women publicly sunbathing in bikinis, are outlawed outside designated ‘uninhabited’ islands set aside exclusively for resort development.

A letter sent by MATATO to the Islamic Ministry stated that the biggest gift from God to the Maldives over the past 40 years was the establishment of tourist resorts on uninhabited islands in the Maldives, according to local media.

The letter also argued that profits from the travel industry over the 40 years had been used to build harbours, roads and mosques across the country.

Considering the financial impact of tourism to the country’s revenue, MATATO President Khaleel said a letter had been sent to the Islamic Ministry asking for tourism to be included along with other industries worthy of being blessed in the Friday prayer.

“We are expecting a response [to the letter] by Sunday (June 2) or Monday (June 3) next week. We are expecting positive feedback from the ministry, not for ourselves, but for the sake of the country,” he said.

Given the substantial contribution of tourism to the country’s GDP – thought to indirectly reach over 70 percent – Khaleel questioned the financial impact to the country should the industry cease to exist.

Khaleel added that the government had earned large amounts of additional income from import taxes on goods and services brought into the country to cater for holidaymakers.

Minister of Islamic Affairs Sheikh Shaheem Ali Saeed and Minister of State for Islamic Affairs Mohamed Didi were not responding to calls from Minivan News at time of press.


Gasim receives ‘lifetime achievement’ award at Maldives Travel Awards

The Maldives’ first ever travel awards ceremony was held at Paradise Island Resort on Friday evening to mark 40 years of tourism in the country.

The event, organised by the Maldives Association of Travel Agents and Tour Operators (MATATO), was sponsored by India’s GMR, the current developers of Ibrahim Nasir International Airport (INIA) which is expected to welcome over one million visitors into the country this year.

Following the opening of the events by some of the Maldives’ top musical acts, including Unoosha, Barchi, Ritte and Mummu, 21 awards were distributed for the categories of resorts, hotels, liveaboards and aviation.

The MATATO appointed judging panel included Dr. Mahamood Shougee (Former Minister of Tourism and Civil Aviation and Former Minister of Education), Dr. Ahmed Adham Abdulla (CEO of Maldives Transport and Contracting Company), Ms. Zeenaz Hussain (Dean of Faculty of Hospitality and Tourism Studies), and Mr. Ghaly Murthala (Tourism Development Consultant for FJS Consulting Pvt Ltd).

Amongst the individual award winners on the night was Gasim Ibrahim, owner of Villa Hotels – the parent company of Paradise Island and current leader of the government aligned Jumhooree Party (JP) – who received a lifetime achievement award.

The Hulhule’ Island Hotel (HIH) also won the award for best luxury hotel whilst Paradise Island resort won the award for leading business hotel. The Villa group also picked up an award for leading domestic airport.

Mr Maleeh Jamal – formerly head of MATATO and current Deputy Tourism Minister – was also in line for a personal award, receiving an appreciation plaque alongside Abdulla Jabir – Deputy Leader of the JP – and Yoosuf Riffath, managing director of Capital Travel.

“The event was very successful, and we thank all the sponsors and MATATO for their assistance and support in making the first Maldives Travel Awards a grand success,” said Ismail Hameed, Director of Marketing for the event’s management company, High Rise.

“We also thank all the nominees and congratulate all the winners, and hope that more resorts, hotels, Liveaboards, airlines and airports will participate in next year’s awards,” he added.

Friday’s award winner Maleeh Jamal declared that the “hard days were over” for Maldives tourism, the country’s primary industry, responsible for over 70 percent of the country’s GDP.

Amidst the uncertainty since February’s power transfer, tourism authorities in the country have pursued a strategy of collaboration with the country’s private sector to try and strengthen arrival numbers to the country.

This focus included signing a US$250,000 (Rf3.8million) advertising deal to promote the country’s tourism industry on the BBC through sponsorship of its weather services.

In April, the Maldives Marketing and Public Relations Corporation (MMPRC) confirmed the appointment of New-York based public relations agency Ruder Finn to “oversee the overall media coordination and achievement of PR related solution for destination Maldives.”

Despite the scepticism of some leading branding consultants about the ease with which the Maldives can overcome the negative headlines of this year, Maleeh anticipated increased growth in the coming months.

Arrival numbers to the Maldives between January and August this year totalled 614,802 people – an increase of 2.9 percent compared to the same period during 2011.


Police to crack down on tour agents scamming tourists

Police have announced plans to crack down on tour operators who are allegedly scamming tourists visiting Maldives, after several complaints were filed by tourists who have been targeted in these scams.

The reports of the tourist scams will be unwelcome for an industry which is already struggling to remain on top of its niche market of small island tourism as it faces fluctuating arrival rates, a decline in traditional markets, potential tax increments and a deteriorating image as political instability grows.

According to the police, some tour operators are defrauding tourists by charging large amounts of money in advance to pay for reservations, without actually making the payments to the resort.

“A lot of problems are created when the tourists arrive in Maldives after making the payments to the travel agencies and discover [the agencies] have not paid the resorts,” Deputy Head of Crime Specialist Command Mohamed Riyaz told press on Saturday.

Although the reported cases are uncommon and several were successively resolved, Riyaz noted that the police have started investigations into the tourist rip-offs as they are being “repeated”.

Police are taking administrative action against four agencies suspected of defrauding tourists, while investigations are pending in six “serious” cases, according to the Deputy Head of Crime Specialist Command.

He added: “The licence of agencies not paying advance money to the resorts will be terminated and their bank accounts will be frozen under the criminal investigation.”

The police have also requested tour operators to refrain from such scams that have the potential to “deeply harm” the tourism industry of Maldives, which contributes almost 80 percent to the national income.

“Operated from bedrooms”

Speaking to Minivan News, the Maldives Association of Travel Agents and Tour Operators (MATATO) and Maldives Association of Tourism Industries (MATI) – associations which represent tour operators and resort owners, respectively – revealed that the roots of the scam runs deeper.

MATATO’s President Mohamed Khaleel contended that there are “no legal restrictions to the fraudsters who want to run these scams”.

“Anyone can go to the Economic Ministry and set up a company. Get a travel agent licence, set up a website and start bringing tourists. Over the past two years, we have raised several concerns in various platforms about these paper companies defrauding the tourists and resorts,” Khaleel explained.

Police yesterday confirmed that the tour operators suspected to be complicit in the tourist rip-offs were registered, liscenced and had their own online booking service. However, the police did not reveal the identity of the companies as the investigation is pending.

However, MATATO’s President claims that out of nearly 500 registered and licensed tour operators and agents, only 50-70 are  professional agents “committed” to the industry.

“Others don’t even have offices, they just put a name board on the street and operate from bedrooms. No commitments. They take money from tourists, close it down and go open another agency again,” he added.

MATI’s Secretary General Mohamed Ibrahim Sim echoed similar concerns, recalling several instances where resorts have faced difficulties in collecting payments: “Some tour operators with outstanding payments have declared bankruptcy and disappeared. We have not even been able to trace some of them back.”

Both Sim and Khaleel emphasised the establishment of legal frameworks to provide legal protections to the industry and to prevent “a few fraudsters from tainting the image of whole tourism sector”.

“The solution lies in establishing better legal frameworks where the tour operator, resort operator and the customer is protected,” Sim argued.

“We have to enforce these laws and regulations. Beacause of the new innovations in the sector, the dealings between the resort and the tour operators are changing very quickly. We need to keep up with them in terms of an updated legal framework, where laws and regulations are revised and revamped consistently as the technology changes everyday. If we do not keep up with it, we are going to face these problems.” he further noted.

Meanwhile, MATATO’s President Khaleel observed that they are working on a draft of Local Travel Agent Regulation and Code of Conduct to gap the loopholes in the system and facilitate in protecting the industry. However, it is yet to be approved from the ministry and necessary laws need to be amended as well, according to Khaleel.