Business

The changing face of tourism and work: How Maldives is successfully adapting to the pandemic

Published

2 years ago

27/01/2022

MNN

It’s December 2023. Rita, a young businesswoman, has just finished meeting with clients in Chennai, India and anticipates meeting friends in Singapore for the holidays two weeks later. An employer-sponsored hybrid work model allows her to work from anywhere. She chooses to work at a guesthouse in Male, Maldives thanks to great Internet connectivity while spending time absorbing the local culture and South Asian cuisine, even trying her hand at snorkeling. Pre-COVID-19, she would have had to fly back from Chennai, India to snowy Chicago where she resides; go to the office for 10 days; work fighting an arduous jetlag; and then fly back East almost 10 thousand miles to Singapore. Now not only is she significantly reducing her carbon footprint, but she also feels revitalized after her stay in the Maldives, and is happier and more productive. Not to mention, she has contributed to Maldives’ tourism industry.

Is Rita’s practical yet creative twist on work-life balance indicative of the future of tourism—and work?

According to various measures in the World Bank’s latest South Asia Economic Focus (SAEF), the region’s tourism heavy nations—Maldives, and to a lesser extent Nepal, Sri Lanka, and Bhutan—are well poised to take advantage of new services and digital technologies along with a new-found need for wellness post-pandemic, to boost their economies . See a prior blog on services as the driver of development in South Asia.

Tourism: Savior for a Post COVID Economy?

Before COVID-19, tourism was among the fastest-growing sectors in Maldives and Bhutan, with a growth rate that outpaced GDP growth rates. The pandemic and related stringent measures hit all South Asian countries dependent on tourism hard, leading to a deep contraction in GDP in 2020. According to the World Travel and Tourism Council, the entire global tourism industry, particularly business travel, was devastated by the pandemic. Business spending decreased by 61 percent from 2019 to 2020 compared to 49 percent for leisure travel. Business travelers on average spend much more than leisure and domestic travelers, making the recovery of business spending essential for the entire travel sector. As the industry struggles to recover, there is also great uncertainty about how the future of work could transform the demand for travel, and many expect international business travel to be the last segment to recover as it is most sensitive to travel restrictions.

The government’s policies and interventions around border restrictions and health regulations play an important role in the recovery of the tourism sector in Maldives.

However, despite these uncertainties, our analysis in the South Asia Economic Focus shows that tourism has the potential to be a fast-growing sector post-COVID amidst new remote work possibilities and changing travel behaviors:

The desire for travel is strong, spurred by the pent-up demand in leisure travel, which has been driven by new hybrid work environments and household savings during the pandemic.
As remote work becomes a long-term reality, more than half of the global tourists have expressed interest in extending business trips or working remotely in tourism destinations while enjoying leisure time.
There is also evidence of an increase in the average duration of stay by 2.4 days since 2020, according to Tourism Status Updates by the Ministry of Tourism Maldives.
The ravaging effects of COVID-19 on mental health may also increase the demand.
COVID-19 is changing tourists’ attitudes and behaviors. According to recent online surveys by booking.com, more than half of global travelers, particularly younger travelers, started looking for travel plans that were more sensitive to the environment and local communities, including staying away from crowded tourist attractions and exploring lesser-known destinations.

South Asian countries already have a comparative advantage in developing niche tourism and ecotourism, as they are endowed with diverse natural and cultural resources. Therefore, small and tourism-dependent countries can view the pandemic as an opportunity to unleash the potential of tourism and pave the way for sustained growth going forward.

Maldives: Setting the Bar High in Tourism

Maldives has been exemplary in its resilience and ability to recover. In 2021, visitor arrivals reached more than 80 percent of pre-COVID levels, far outpacing other similar tourist destinations.

Tourism sector skyrockets in Maldives compared to counterpart South Asian nations, largely due to aggressive recovery efforts and creative marketing.

These are some lessons we can draw from Maldives’ spectacular recovery in the tourism sector:

First, the government’s policies and interventions around the border restrictions and health regulations play an important role in the recovery of the tourism sector. For example, Maldives took a concerted effort to reopen its border to tourists as early as July 2020 but implemented strict hygiene protocols for tourists, including one of the fastest COVID-19 vaccination campaigns in the world. This has improved the confidence of travelers and has created high-value consumers.

Second, Maldives quickly made an effort to capture new source markets and expand to new countries of origin. For example, the emerging source of the international tourist market from Russia and India—in part arbitraging quarantine rules—has compensated for the tourism revenue loss from China, its top source market before the pandemic.

Third, Maldives is seizing changing preferences to promote a better image. In 2020, Maldives launched a marketing campaign with the tagline “Isolation never looked this good” to emphasize its unique reputation of being a niche destination, while emphasizing environmentally sustainable tourism.

Fourth, it is investing in digital technology as the demand for high-speed internet and contactless services rise due to the pandemic. In Maldives, more than 60 percent of the population has access to broadband Internet—with relatively high bandwidth speed—while other tourism-dependent South Asian countries are still lagging , limiting the possibilities to meet travelers’ need for working remotely. Moreover, digital platforms will be important in minimizing physical interaction when traveling, while still fulfilling travelers’ needs. For example, one of the luxury resort in Maldives, has developed an app to facilitate contactless services including ordering food, virtual check-in and check-out, and other amenities to adapt to changing customer behaviors.

Adapt or perish? Maldives is choosing the former. It behooves other South Asian nations to pay attention as they build back resiliently post COVID-19.

Source: https://blogs.worldbank.org/

Business

Dubai company awarded the development of SEZ

Published

24 hours ago

12/05/2024

An agreement has been signed by the Maldivian administration with UAE’s International Free Zone Authority (IFZA) to develop Special Economic Zones (SEZ) in the Maldives.

The agreement, officially co-signed by Minister of Economic Development and Trade Mohamed Saeed and IFZA Chairman Martin Gregers Pedersen during a special ceremony, marks a significant milestone in economic development.

Speaking at the ceremony, Minister Saeed emphasized the timeline for finalizing the agreement, committing to reach a consensus within the next four months. As part of the agreement, Fonadhoo in Kaafu Atoll will be transformed into a financial hub, featuring a new financial center and a bridge connecting Male’ and Hulhule. IFZA will bear the expenses for these developments.

The Ministry of Economic Development and Trade further highlighted plans for the Economic Gateway project in Ihavandhippolhu, aiming to attract investors with IFZA’s expertise. Addressing the attendees, Chairman Pedersen expressed confidence in the success of the project, underscoring collaborations with investors to further enhance opportunities in the Maldives.

The development of SEZs remarkably aligns with the President Dr. Mohamed Muizzu’s vision to diversify the economy and stimulate financial growth. The Maldivian administration is optimistic about attracting future investments and positioning the country as a desirable destination for business opportunities.

Source(s): PsmNews

Business

Over USD 713M generated attributing to revenue increasing by 3.7%

Published

2 days ago

11/05/2024

Ministry of Finance has revealed a remarkable surge in the government’s revenue generated as of April 25, which exceeds USD713 million. The latest weekly fiscal report publicised by the ministry indicates that this contributes to a 3.7% increase in revenue in comparison to the revenue of USD693 million, generated within the same period, in 2023.

The fiscal report shows that the revenue comprises USD 596 million in tax revenue, USD116 million in non-tax revenue, and USD3 million in aid received. Tax earnings include import duty, business and property tax (BPT), goods and services tax (GST), as well as earnings from GST. The breakdown of revenue generation includes USD45 million from import duties, USD168 million from BPT, USD330 million from GST, USD24 million from green tax, USD22.6 million from airport service charges, and departure tax.

Expenditures until April 25 totalled USD817 million, with USD629 million allocated to recurrent expenses and USD181 million to capital expenditures. This represents a significant reduction in expenditures compared to the USD244 million spent by the government in 2023, during the corresponding timeframe. Recurrent expenses cover USD207 million for salaries and allowances and USD408 million for administrative work. Meanwhile, capital expenditure primarily encompasses expenses related to structural development.

Source(s): PsmNews

Business

Maldivian regional fleet grows with fourth ATR arrival

Published

4 days ago

09/05/2024

Maldivian, the national carrier of the island nation on Wednesday, announced the arrival of its newest addition to the fleet, a fourth ATR 42-600 aircraft.

The new aircraft added to the carrier landed at Velana International Airport some time on Wednesday.

In order to commemorate the milestone, a special ceremony was held at VIA which was attended by distinguished guests, officials and key partners.

The new aircraft, Maldivian added, will enhance the airline’s capacity to serve more routes and provide increased connectivity for both locals and tourists. Moreover, this fleet expansion also reflects Maldivian’s commitment to offering exceptional service and convenience to its passengers.

At Wednesday’s event to welcome the new ATR aircraft, Maldivian’s Managing Director Ibrahim Iyas emphasized the importance of the new aircraft in the company’s growth strategy.

“We have made great strides toward achieving both operational excellence and a greater passenger experience with the addition of this brand-new ATR aircraft to our fleet,” Iyas commented.

“This aircraft offers an unprecedented level of comfort thanks to improved interior humidity control and much lower noise levels. Modern avionics and exceptional fuel economy which further support our dedication to sustainability while maximizing performance throughout our expanding network.”

Maldivian fleet currently has 25 aircraft which include an Airbus A320 commercial carrier, four ATRs, nine Dash-8 series aircraft and eleven Twin Otter seaplanes.

Source(s): sun.mv