Beijing to ‘publicly shame’ unruly Chinese tourists when abroad: Washington Post

“On Friday, Chinese state media reported Beijing was taking new measures to combat a growing problem: the embarrassing behaviour of Chinese tourists when abroad,” reports the Washington Post.

“After a spate of incidents involving Chinese nationals abroad, Li Jinzao, head of China’s National Tourism Administration, was reported to have said that records would be kept of problem tourists, with tourists “ranked” on the severity of their misbehaviour. These tourists would receive messages reminding them to behave when they land at their destination. If they disobeyed, they would be punished.

Li also announced a new tactic to improve tourists’ behaviour: Public shaming. He encouraged Chinese tourists to take photos or video of bad behaviour they spot and pass it on to authorities. The evidence would then be publicised.

Over the past few years, the behaviour of some Chinese citizens when abroad has become a source of ire for the nation. Online, many stories of Chinese tourists showing a lack of civility or behaving selfishly have become viral sensations: There was the Chinese teenager who defaced a 3,500-year-old temple in Egypt, for example, and the group of Chinese tourists who washed their feet at the Louvre in Paris.”

Read more


Tourism Ministry to use commercials and street performances to attract Chinese tourists

The Ministry of Tourism, Arts and Culture has revealed new plans to promote the Maldives to Chinese tourists through commercials showcasing the country’s culture.

The announcement follows a succession of international campaigns that threaten to damage the reputation of the Maldives’ tourism industry, both in China and traditional European markets.

Earlier in March, calls for a tourism boycott of the Maldives exploded across Chinese social media networks after allegations of discrimination against Chinese guests became widely circulated.

The tourism industry suffered another potential blow last week, when the online petition website received over one million signatures in protest of the sentencing of a 15 year-old rape victim to 100 lashes for the offence of fornication.

In response to the negative press, Deputy Tourism Minister Mohamed Maleeh Jamaal told local media on Tuesday (March 26), that the ministry is currently preparing a number of activities to promote the country to the Chinese market.

According to the Maleeh, the ministry is preparing two commercial segments to be aired on Chinese national broadcaster, CCTV.

“The programs will show Maldives tourism, culture, traditional talents such as boat construction, and other themes that display the beauty of Maldivian culture and so on, Maldives resorts and their natural beauty, underwater footage, it’ll be excellent for the channel,” Maleeh was quoted as saying in SunOnline.

In addition to the commercials, the deputy tourism minister revealed that plans are currently underway to stage street performances in four different cities in China.

Maleeh claimed that the programs will work to the country’s advantage and will significantly promote Maldives tourism in China.

“Street performances are to be played in four different cities, and we will be meeting with at least 2000 agents, and even if we can attract about 20 news reporters from each city, it is large number, it will have a large effect on tourism,” Maleeh was quoted as saying.

According to Maleeh, the ministry has initiated a number of new efforts in order counter the widespread negative publicity circulating against tourism in the Maldives.

Tourism Minister Ahmed Adheeb and Deputy Tourism Minister Mohamed Maleeh Jamaal were not responding to calls from Minivan News at time of press.

Campaigns will damage both tourism and economy: Maleeh

On Sunday (March 24), Maleeh told local media that recent campaigns calling for tourists to boycott the Maldives would damage both tourism and the country as a whole.

Maleeh claimed the petition launched by Avaaz calling for the Maldives government to end the practice of flogging was really an attempt by the opposition to damage the country’s economy for political gain.

The petition, which has been signed by more than 1.2 million people, was launched after the Juvenile Court sentenced a 15 year-old rape victim to 100 lashes for a separate crime of fornication.

“When they started the campaign, they were clearly aware of the president’s stand, as well the attorney general’s stand on the matter,” Maleeh said, according to SunOnline.

“Looking back, a 14 year-old was given the same sentence during former President Nasheed’s presidency and nobody seemed to have talked about that. This whole deed is an attempt to defame the country’s tourism industry and [damage the] economy,” he said.

Cup noodle discrimination

Earlier this month, dismissed Chinese employees of the Beach House Iruveli resort – formerly Waldorf Astoria – posted allegations on the Chinese forum Tianya that guests from the country were receiving inferior treatment to Europeans, despite paying the same prices.

The staff alleged that this discrimination extended to removing kettles from the rooms of Chinese guests, to prevent them from making instant noodles in their rooms and thereby forcing them into the resort’s restaurants.

The resort has since denied the claims, stating that it had “removed damaged kettles from rooms as part of routine maintenance due to the fact that these kettles were damaged by guests by cooking food.”


Q&A: Former Secretary General of MATI ‘Sim’ Mohamed Ibrahim

Former Secretary General of Maldives Association of Tourism Industry (MATI) ‘Sim’ Mohamed Ibrahim stepped down from his position in December 2012, having held the post for the last 15 years. Prior to his work at MATI, Sim held various positions within the tourism industry, even working at Television Maldives as the Chief of News and Current Affairs.

Luke Powell: The Tourism Ministry has put a lot of emphasis on achieving one million tourist arrivals for 2013, how important is this target and is this the right way to go about measuring success in the industry?

Sim Mohamed Ibrahim: There are many ways of measuring tourism. The most important of those measures is in terms of yield, as in what you have left after your expenses. I think there is a big challenge at the moment in this area. Despite resorts being very full, there are a few companies relying on Chinese tourists, and while tourists from China are good in the sense of keeping numbers up, in terms of yield, it’s not good.

It’s very expensive to run the resorts and I think we are not doing as well as we should be. Last year was not so good, we were able to keep the numbers fairly high but they were again mostly Chinese. It’s not really about the numbers, what we should have is average occupancy at good rates, however, we are finding that difficult to maintain as we now have to bring down the rates, offer discounts, and give special prices, to make up for the numbers being down.

The one million tourists mark is always good in terms of marketing and public relations as it is a nice big number. It keeps the momentum up and is very good psychology. But it’s not such a huge thing now.

LP: In your time at MATI, what developments did you oversee and were there ever any difficulties in carrying out your role?

SMI: My time was purely administrative. Our main concern at the time was trying to get the best deal for people who invested in the tourism industry and worked in the industry.

My main role was to try and keep people together and to push for common goals. We worked with the government and parliament, which was not easy. We found out that in parliament you have people from different parties and people with different viewpoints and motivations. It turned out that working with parliament was always difficult, whereas with the government it was easy.

With [former President Mohamed] Nasheed it was a lot easier to work, as he was someone very well known and familiar to us. He had his moments, he would sometimes stick to something and not let go, but usually we found we could negotiate and he in turn would talk to his cabinet and to his group we would be able to come to compromise.

LP: You said that working with parliament was not always so easy, what difficulties were there?

SMI: Some issues we couldn’t really agree on, some people wanted to ban alcohol from the country, but tourists drink it like water. It’s like us with coffee and tea. So how do you work with people like that? It becomes impossible.

Even with the economic issues, there are people who have the perspective that the people in the Tourism Ministry make too much money and that the government should be taking more from them.

They don’t really understand the workings of the ministry, running costs, investments costs and the facilitation of all these things. It’s like a normal business, but there is an idea in the country that the tourism ministry is rolling in the stuff. There are bills to pay, loans to pay and staff to pay, it’s very hard running tourism in this country.

LP: Would you say that attitude still exists? Earlier this year there was criticism from MATI over the decision to allocate just MVR 20 million from the 2013 budget for tourism promotion, when the tourism ministry had requested MVR 200 million.

SMI: There are people within parliament who think the tourism ministry is so rich they can fund their own advertising and promotion. It has been said, I can’t quote, but there are some who say that. But obviously it’s not true, people in the ministry are already financing quite a bit of it.

LP: Are there other difficulties faced by the tourism industry in the Maldives?

SMI: It is hard here because there is a lot of work and there is so much co-ordination. Everything has to be brought in, cleared by customs, taken to the resorts and then prepared.

The other difficulty is the management of human resources. A lot of young people in the country do not want to work in the tourism industry so you have this sole problem of finding Maldivians who want to work as opposed to people from overseas who want these jobs.

That doesn’t sit very well with the local population because the media is obviously employed by people who are not very happy with the tourism industry for using expatriates. All the money is going outside the country, when it should be going to Maldives.

Maldivians are not working in this industry because they are not given entitlements and privileges and because they think the industry is not paying all that much, but this is not true. It is just that the kind of work we have in the resorts has not yet become attractive to young Maldivians leaving school.

LP: What sort of work is available to them? Is there any other reason why they are not taking the jobs?

SMI: A resort in the Maldives is like a small town, so you have technical, engineering, maintenance, food production and public relations roles. They all exist on the island.

There is always this thing between the government, the public and the Tourism Ministry, whereby the government and the people seem to assume that the tourism ministry should be training its own people.

It’s difficult because many of us feel the education system in country should be geared towards teaching people to serve the economy and the country, and that should be through jobs available in the Maldives. For example, we checked the Ministry of Tourism once and there were perhaps a thousand jobs going.

What I am saying, is that the jobs are there, but we haven’t been able to tell the young people that there is an alternative in resorts where they can work. But there is something missing, it is not gelling.

Working in tourism is not part of the school curriculum. They teach travel and tourism, but that is not to do with running hotels and hospitality. They are linked, but they are not the same thing. These are some of the problems the industry faces in the country.

LP: How do you think the tourism industry as a whole in the Maldives is progressing?

SMI: I think the industry is going very well here. People who started this 40 years ago are still very involved and these guys have so much experience because they have worked every single day of their lives and know what’s going on and what’s needed.

People like Champa, his company has comes up with brilliant new concepts every time. Then there is Universal, they have a very high standard and a lot of their resorts are home-grown, places like Baros and Kurumba, these are local companies but they are able to compete with world standard brands. There is a lot of thinking going into that. People are not just sitting back and taking the money, they are planning where to go next.

LP: There have been some negative reports in local media regarding resort developments by Maldives Tourism Development Company (MTDC), what is your view on the firm?

SMI: MTDC was a very good project to start with, it was very good thinking because not everyone can be an entrepreneur or even a manager. There are people who just don’t have the skills or inclination to do that. MTDC was a brilliant idea where we can all have shares in the tourism industry.

The former chairman of MTDC ‘Champa’ Hussain Afeef, when he took on something, he would complete it. Herethera Resort for example is the same distance as Sri Lanka is from us in Male’, 470 miles, yet he built that resort in just over a year. That was amazing.

However, when Nasheed came in, he obviously wanted to bring in new management, he knew these people but he misjudged the importance of somebody like Afeef there. When Nasheed removed him, the company made losses and it became worthless. It was such a brilliant thing, shattered. Nasheed has put people in there, the president has put people in there and these people have not been able to come up with any creative ideas.

If they bring in good management they might turn a profit, but right now it is terrible. It has to be resurrected and changed. Someone needs to be brought in who can see things strategically and has empathy for the people. See the company for what it is – a company for the people. But it is worthless at the moment, it needs to be revamped.

LP: What do you think the future holds for the tourism industry in the Maldives?

SMI: There is a trend moving towards people who are wanting to stay and see something different, rather than coming just for relaxation. People want to be involved in the community. It’s not going to be huge, but there are some people who want to do that, it’s a different kind of tourist.

The future of tourism in this country is immense. We have already started building rooms underwater. We already have clubs, dining rooms, and spas and very soon we will have entire bungalows underwater. However, the time it takes to get the Maldives and the cost of getting here is an issue for the future. If they build better planes, and find a way of reducing fuel costs that will be much better for the country, but this is not something we cannot predict.

LP: Why did you decide to leave MATI?

SMI: I needed a break, I had been there for 15 years and I needed to do something different. Being in tourism all these years I realised there is another aspect to tourism that has been totally ignored, and that is culture and environmental tourism. I thought it would be very interesting for me to start digging into this.

LP: Do you think that will be a new tourism market in the Maldives?

SMI: It will be a niche in the market. It might get a bit bigger when we start taking conservation seriously and the restoration of our historical sites – things like the old mosques and cemeteries. There is a lot of history in this country that we have not even tapped yet and that makes me very excited.


Tourist arrivals show decline of 7.6 percent in January 2013

Tourist arrivals for January 2013 were down by 7.6 percent compared to the same month in 2012, figures from the Ministry of Tourism have revealed.

Earlier this month, Tourism Minister Ahmed Adheeb told local media he was confident the Maldives would reach one million tourist arrivals in 2013, after narrowly falling short of the same target for 2012.

However, figures released by the ministry show that tourist arrivals from Europe and Asia – the two largest markets – had fallen by 4.4 percent and 16.8 percent respectively in January 2013 when compared to the same month in 2012.

According to figures from the tourism ministry, last month was the first time in three years there had been a decline in tourists coming to the Maldives in January when compared to figures from previous years for the same month.

The monthly number of Chinese tourists arriving in the Maldives fell for the first time in over six months compared to figures from previous years.

China, which holds the largest share of the arrivals to the Maldives at 21.6 percent, fell by 31.4 percent from 28,008 in January 2012 to 19,208 in January 2013.

The European market continues its steady decline, with Italy – which held the largest share of tourist arrivals in Europe in January 2012 – falling by 32.5 percent from 10,451 to 7,050 in January 2013.

Russia now holds the largest share of tourists for all countries classified under ‘Europe’ by the ministry, accounting for 10.2 percent of all arrivals in January 2013 at 9,061.

Arrivals from United Kingdom fell from 7,001 in January 2012 to 6,367 in January 2013, while German arrivals – which account for the third largest share of the European arrival market – fell by eight percent when compared to the same month in 2012.

In contrast, India’s tourist arrivals grew by 51.2 percent from 2,303 to 3,483 and arrivals from countries in the Middle East increased from 1,303 to 2,312.

Tourism Minister Ahmed Adheeb was not responding to calls from Minivan News at time of press.

Tourism budget increased by MVR 60 million

Earlier this month, the tourism budget for 2013 was increased from MVR 20 million (US$1.2 million) to MVR 80 million (US$5.1 million).

The increase came after criticism from the Maldives Association of Tourism Industry (MATI), who last month called for the government to reconsider the MVR 20 million budget allocated for tourism marketing in 2013.

The initial sum of money allocated was the lowest in eight years, according to a statement from MATI, which highlighted concerns that the Maldives’ economy was mostly reliant on tourism.

Tourism Minister Ahmed Adheeb told local media that the ministry had initially requested a budget of MVR 200 million (US$12.9 million) to carry out tourism promotion for the year, however parliament had “erased a zero” from the figure when finalising the budget.

Adheeb noted that while tourism promotion is expensive, the revenue generated from the industry “drives the entire engine”.

“When we put down MVR 200 million, the government authorities don’t actually realise the priority that this requires. Parliament erased a zero from the MVR 200 million we proposed, and gave us MVR 20 million,” he told Sun Online.

“Then we had to work in all other different ways, and now the Finance Minister has committed to give us MVR 60 million more.”


Maldives falls 40,000 short of million tourist target for 2012

The Maldivian government has narrowly failed to reach its target of one million tourist arrivals for 2012, according to figures released by Ministry of Tourism, after a year of political turmoil and an economic slump in key markets.

Despite arrivals falling short by roughly 42,000 tourists, figures released by the ministry have shown that overall arrivals rose 2.9 percent from 931,333 in 2011 to 958,027 in 2012.

Prior to the release of the figures, Tourism Minister Ahmed Adheeb predicted that while there may be a shortfall of roughly 20,000 in 2012, he was confident the ministry could achieve the one million mark in 2013.

“There were a lot of hiccups last year with the political turmoil that the country experienced. It is important that we do not compare ourselves to other destinations like Sri Lanka or Seychelles, as our tourism market is very different. We have a high-value tourism market.

“We will formulate a strategy to go forward this year and later this month [January] we are going to finalise the fourth master plan of tourism. I am sure we will get one million tourists in 2013. I can assure you of it,” Adheeb told Minivan News earlier this month.

Figures released by the  tourism ministry show that Europe, which accounted for 54 percent of all tourist arrivals in 2012, fell by 3.7 percent from 537,757 in 2011 to 517,809 in 2012. Arrivals from the United Kingdom – the second highest share of European arrivals to the Maldives this year – continued to fall from 104,508 in 2011 to 91,776 in 2012 – a 12.2 percent  drop.

Germany took over the UK in 2012 as having the largest share of European arrivals to the Maldives, growing by an extra 7,834 arrivals from 90,517 in 2011. The 8.7 percent increase in arrival numbers, meant that Germany was accountable for 10.3 percent of all tourist arrivals in 2012.

Italy, which had the second highest arrival share of European tourists in 2010, fell drastically in 2012 by 24.4 percent from 83,088 arrivals to 62,782.

Meanwhile, tourist arrivals from ‘Asia and Pacific’ regions continued year-on-year growth from 2010, increasing by 10.2 percent from 2011 and accounting for a 40.1 percent share in the overall market at 384,506 arrivals in 2012.

Shift to ‘low yield’ Chinese tourists

Chinese arrivals continued to grow in 2012, with a 15.6 percent increase from 198,655 in 2011 to 229,551 in 2012.

Chinese tourists now account for the largest share of arrivals from any nation in 2012 standing at 24 percent, a massive increase from Chinese arrival figures in 2009 which stood at 60,666.

Despite the high number of Chinese tourists, tourism experts stated back in 2010 that Chinese guests were relatively ‘low yield’ despite their high numbers.

Speaking to Minivan News in 2010, the now former Secretary General Maldives Association of Tourism Industry (MATI), Sim Mohamed Ibrahim, said Chinese tourists tended to spend less than their European counterparts.

“The Chinese who come do not come for the sun and the beach – they come because the Maldives is a novelty, a safe destination, and because of their new-found freedom to travel. Resorts are saying there are not many repeat visitors from China,” he said at at he time.

Tourism growth slowed to less than one percent in 2012

Tourism growth meanwhile slowed to less than one percent in 2012. While the tourism industry grew by 15.8 percent in 2010 and 9.1 percent in 2011, the industry’s growth in 2012 was expected to be 0.7 percent.

The two main reasons cited by the Finance Ministry for the anaemic growth were “the political turmoil the country faced in February” and a decline in the average number of nights tourists spend in the country “as a result of a decline in the average number of days a tourist spent in the Maldives.”

On average, tourism accounted for 28 percent of GDP during the past 10 years.

Despite the widely reported Ibrahim Nasir International Airport (INIA) dispute between the Indian infrastructure giant GMR and the Maldivian Government in December last year – as well as claims of anti-India sentiment within the country – arrivals from India  increased by 34 percent in December compared to the same month in 2011.

The largest increase in tourist arrivals compared to 2011 was from the Middle East, which saw close to a 50 percent rise in arrivals for 2012 at 21,843 from 14,570 in 2011.

Arrivals from United Arab Emirates grew the highest in percentage from 2011 by 76.6 percent. Despite the high percentage growth however, the number of tourists was comparatively low to other countries standing at 4,047 in 2012.

MVR 70 million tourism marketing budget in 2012

The Maldives Marketing and Public Relations Corporation (MMPRC) was allocated a budget of MVR 70 million (US$4.5 million) in 2012 to conduct marketing activities for the year, almost double the 2011 budget of US$2.3 million, which saw the country receive 900,000 tourist arrivals.

Following February’s controversial transfer of power, the incoming government of President Dr Mohamed Waheed Hassan sought to utilise public relations groups and advertising to try and offset the impact of negative news headlines resulting from the controversial nature of the change in government.

That focus included a US$250,000 (MVR3.8million) advertising deal to promote the country’s tourism industry on the BBC through sponsorship of its weather services, as well as signing a £93,000 per month (US$150,000) contract with public relations group Ruder Finn to try and improve the country’s image internationally.

Maldives tourism authorities said back in October that they were confident the country would meet its one million visitor target, despite ongoing “political turmoil”.

Registered beds up, occupancy rates down

According to the 2012 statistics released by the Tourism Ministry, the average number of registered beds between resorts, hotels, guest houses and safari vessels stood at 27,702 in 2012 – an increase of 1,346 from 2011.

Despite the increases in tourism arrivals, bed nights fell from 6,529,200 in 2011 to 6,450,794 – a total drop of 1.2 percent – and the average days spent in the Maldives by tourists fell from 7.0 days in 2011 to 6.7 days in 2012.

Occupany rates also fell across all types of accommodation aside from a 1.9 percent increase on safari vessels. Altogether the occupancy rates fell from 73.1 in 2011 to 70.6 in 2012.

Maldives top five markets by visitor numbers (2012)

China: 229,551

Germany: 98,351

United Kingdom: 91,776

Russia: 66,378

Italy: 62,782


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.


Government to consult tourism industry on potential T-GST increase

The government will hold a consultation with the tourism industry this week to test its appetite for an increase in the Tourism-GST (TGST), Tourism Minister Ahmed Adheeb has said.

The International Monetary Fund (IMF) has urged the Maldives to increase the T-GST from six percent to 12 percent, among several measures the organisation says are urgently needed to offset the Maldives’ spiraling budget deficit, and avoid miring the country in poverty.

Parliament’s Finance Committee last week calculated that the budget deficit would reach 27 percent of GDP, on the back of plunging revenues and a 24 percent increase in government expenditure.

Adheeb told Minivan News that the government would present the IMF’s report to the industry, and discuss how to proceed: “We have to be realistic,” he said.

“The IMF has recommended an increase to 12 percent – we need to discuss what kind of increase the industry would like to see over the next five years,” he said.

Adheeb emphasised the need for stability rather than sporadic increases in the tax, cautioning against a sudden change in the T-GST which would affect those tour operators who make pricing agreements and publish brochures up to a year in advance.

However, Secretary General of the Maldives Association of Tourism Industry (MATI), Mohamed Ibrahim ‘Sim’, warned that the tourism industry was already under pressure from a decline in traditional markets.

“Is there an appetite [to increase the TGST]? No, not really. The European economy is not doing well and we would like the costs to remain the same – GST is something we have to pass to the customer. We need to maintain it, at least for the moment,” Ibrahim said.

One resort manager told Minivan News on condition of anonymity that such an increase would have “serious ramifications on many of the markets.”

“Some operators will not accept the increase mid-contract and hence resorts will have to absorb this from revenue,” he explained. “The additional costs will need to be balanced somewhere in the operation and you will find resorts have to [reduce] some of the nice touches for guests, [cut] staffing levels etcetera in order to deal with these ever growing expenses.”

The manager expressed exasperation that resorts were being asked to shoulder the burden without a parallel commitment from the government to reduce expenditure.

“We have seen an increase in some public services salaries and a reduction on working hours in many government departments who are meant to serve the resorts. Many of these government departments make it difficult for the resorts to do their jobs, with bureaucracy and rules to keep extra people in a job rather than making it easier to support the resorts in order to do their job: build more business, increase revenue and hence increase GST [revenue] in a positive manner. An increase in GST right now is the wrong solution.”

The government “needs to take a more supportive approach to the resorts”, he suggested, “whether it be processing visas, expediting customs waits or speeding up the immigration process for guest at the airport. A serious revision of the various government departments is required.”

According to figures from the Maldives Inland Revenue Authority (MIRA), the T-GST brought in 32.4 percent of all government revenue in April.

Total revenue collected in April was Rf2.5 billion (US$162.1 million) – almost double that collected in April last year – however MIRA’s figures do not take into account the substantial revenues lost from the phasing out of import duties, previously the Maldives’ main source of tax revenue.

Former government to blame?

Adheeb blamed the need for the increase on the former government’s changes to the calculation of land lease rents, which he claimed were responsible for an Rf540 million (US$35 million) shortfall overall after the new taxes were introduced.

MATI’s Ibrahim however contended that the changes to the fixed rents were offset by the new taxes: “Our calculation at the time these taxes were introduced were that overall it balances out, but that some resorts pay more.”

Recent changes introduced by the new government to the payment of lease extensions – from a lump sum to an annual basis – have also pulled US$135 million in revenue from the 2012 budget, the ousted Maldivian Democratic Party (MDP) contends.

Economic indicators published by the Maldives Monetary Authority (MMA) meanwhile show a fall in the number of tourist arrivals for March 2012 compared to the previous year, from 80,732 to 76,469. The number of bed nights fell 6.8 percent for the same period, one of only a few recorded declines since the 2004 tsunami. February – a month of high political turmoil and widespread negative international media coverage – recorded a 2.5 percent decline.

An increase in prices would affect established markets already under strain, Ibrahim reiterated.

“It’s hard to say if emerging markets would be put off – China, Russia and the Middle East – maybe not. But [price increases] are affecting the established market. The market situation is not looking good at the moment.”

A survey of nearly 3000 tourists last year reported that 46 percent believed accommodation in the Maldives was too expensive. Soft drinks, alcohol were rated as expensive by 42 percent, while food, water and souvenirs received a similar rating from 41 percent of tourists polled.


Tourists barely put down cocktails: Reuters

Tourists enjoying the sun and sand at the Maldives’ luxury island resorts have barely put down their cocktails during the political crisis rocking Asia’s newest democracy, oblivious to behind-the-scenes links of tourism to the tumult, writes Bryson Hull for Reuters.

Just a 10-minute boat ride from the capital island of Male, site of a police mutiny that led to ex-president Mohamed Nasheed’s departure last week and ensuing clashes, lies the paradise most visitors associate with the Indian Ocean archipelago.

Step off the 15-metre (50-foot) power boat, replete with an air-conditioned cabin and leather seats, that whisks you to the dock at Kurumba resort on Vihamanafushi, and you are immediately in a land of luxury, water sports and relaxation.

The political turmoil, as far as American literature professor Jerzy Sobieraj was concerned, was an ocean away across the glassine turquoise waters at his feet.

“We are having a great time. We heard about the coup, but it doesn’t matter to us. It hasn’t affected us at all,” Sobieraj told Reuters, sipping a glass of white wine alongside his wife, lawyer Ewa Korzan-Sobieraj, on a chaise longue.

Full story


VVIP airport lounge opens after four month project period

“Tourism begins here. The resort begins here.”

Plaza Premium Lounge Executive Director Linda Song described the newly-opened Koimala Executive Lounge at Ibrahim Nasir International Airport (INIA) as “everyone’s apartment” during today’s inaugural event, which included a ribbon-cutting ceremony, speeches and a reception.

The lounge, which includes three sitting rooms, two verandas, a kitchen and a presidential sitting room, is part of GMR Infrastructure Ltd.’s project to expand and upgrade INIA by June 2014. GMR shares the venture with Malaysian Airports Holdings Berhad in a 77 to 33 percent relationship.

The Presidential Lounge offers privacy to government officials.

During a tour of the facility, Mrs Song commented on the facility of working with GMR. “I think its international experience has shaped GMR as a very flexible, open-minded company,” she said.

Tourism Minister Dr Mariyam Zulfa made a similar observation during the opening ceremony, reinforcing her praise of GMR from the earlier opening of INIA’s Plaza Premium Lounge.

“GMR is a company that listens to the stakeholders in the tourism industry, and that pleases the government to no end. I’m always delighted to come to the airport with stakeholders from the industry to open the dialogue for tourism,” she said.

Noting that Plaza Premium was invited to undertake the project only four months ago and with the caveat that the area is due for demolition in two years’ time, Zulfa said the lounge was an impressive and valuable accomplishment.

“Everything to do with the socioeconomic development of the Maldives should center arround tourism,” she said. “Because tourism, of course, is our number one industry, and everything we do should center around making the product even more perfect than it is today.”

The common area features television, wi-fi, and a variety of seating areas.

For a reservation of US$150, VVIP lounge guests are relieved of their luggage at a private security screening while their flights are monitored and their schedules arranged by the lounge concierge. Meanwhile, guests can enjoy an open kitchen and cafe, wi-fi, plasma screen televisions, and spacious seating arrangements.

Plaza Premium Lounge Management Ltd currently services 17 international airports and 60 locations with infrastructural development. The Hong Kong-based company is the world’s first ‘pay-in’ lounge.

Several people noted that the lounge’s opening was well-timed with the SAARC summit, which will bring heads of state from across the region to the Maldives.

Plaza Premium Founder and Chief Executive Officer, Song Hoi See said he did not agree with the project’s constraints but appreciated the challenge.

“Airports and tourism don’t always work together. But the Maldives is a special place, and the airport is the first and last place to impress the tourists,” he said, adding that he anticipated the new airport’s design.

Mrs Song attributed the success to Plaza Premium’s high level of preparation to overcome constraints of the Maldives’ industry. “We are well planned, and we shipped most interior design materials here pre-made. There aren’t many resources here for interior design development, so it would have been difficult otherwise.”

Designer Kinney Chan said the project was enjoyable in spite of the short notice. “It’s great to do something for comfort here, to blend with the resort feel, without getting too heavy.”

GMR CEO Andrew Harrison noted that the design had improved a formerly low-ceiling, dark room by bringing in natural light and creating “a home feel, supported by the excellent service that staff provides.”

“It’s a beautiful country full of beautiful people, and now we’ve delivered a beautiful lounge to match that,” Harrison concluded.