Tourism development policy in the Maldives – policy evolution

When the government of the Maldives relaxed its strict policy of “enclave resort tourism” to pave the way for growth in bed and breakfast tourism in the Maldives, the industry as a whole observed a dynamic change.

The island nation’s tourism industry, which once depended entirely on enclave resort tourism, has seen a paradigm shift towards the growth of local tourism in light of state policies encouraging the establishment of guesthouses and boutique hotels on the residential islands. The luxury tourism segment suddenly faced healthy competition from the budget tourism segment.

Moreover, this in turn is reflected in tourist arrivals to the Maldives in the last decade before the Covid-19 pandemic. Thus, in 2019, the total tourist arrivals according to the Ministry of Tourism reached more than 1.7 million, which was itself higher than the government’s annual target. In addition, a large portion of the total number of arrivals in said year was made up of budget travelers seeking island hopping and local tourist properties during their stay in the Maldives.

Aerial view of Kaafu Maafushi – Photo: Travellog.com

Walking through the past, one would observe that the or more fashionable tourist enclave known in the Maldives as “One Island-One Resort” (OIOR) was first altered in 2008 by the Maldives parliament. after nearly 25 years since the tourism industry began to flourish across the archipelago.

As such, the Second Amendment to the Maldives Tourism Law (Law No. 2/99) allowed the expansion of the tourism industry beyond the confines of the enclave resort convention to which the island nation had been used to it for years. The amendment paved the way for the development of tourist properties in residential islands; outside of hotels.

It also meant that there had been changes in segments and stakeholder powers, which were reflected as a result of the amendment to the Maldives Tourism Law in 2008. As such, there are has had a notable power struggle between the advocates of enclave resort tourism or One Island- The One Resort Tourism Policy (OIOR) and the New Bed and Breakfast Policy. Meanwhile, government officials at the policy-making or authority level foresaw the future of the tourism economy where resorts and guesthouses operate in consistency; either symbiotically, or at least in parallel.

But the problem arises when there is a visible power disparity between the stakeholders; mainly in terms of stakeholders with a strong interest in OIOR policies, having stronger control and power over those who promote guesthouse tourism policies. The variables at play here may differ and perhaps even be subject to interpretation for the casual viewer – but if evaluated in depth, one will notice that it all boils down to the fact that the income generated by tourist resorts is comparatively higher than the income of single-family guesthouses in annual terms. terms. Thus, those who hold direct stakes in tourist resorts have the upper hand in terms of tax value.

However, since the 2010s the specter of power has gradually shifted towards creating a balance between luxury tourism and local tourism, in large part thanks to the responsible policies proposed by the government of Maldives which have overseen the formation, creation and development of the bed and breakfast industry by providing numerous opportunities for local hoteliers and branches of the tourism industry to develop their properties in residential islands.

Maafushi is an outstanding example of successful state initiatives as well as a testament to responsible policies that ensure the sustainability of tourism segments – especially as the country’s tourism industry during the first four decades had mainly operated through enclave resort tourism.

There is no doubt that change is a common factor in everything human – even in human-led economies and this claim is not a hyperbole. As such, the tourism industry itself has had to undergo change and evolution in order to survive the test of time. The integration of a new tourism policy which has led to the development of a whole new segment of the tourism industry – i.e. the birth of the bed and breakfast industry – is the visible result. which is no longer debated.


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