Maldives Monetary Authority (MMA), on Wednesday, revealed that 80 percent of companies across the country's tourism industry reduced salaries for workers in connection to the COVID-19 pandemic.
Prior to the health crisis, which ground to an abrupt stop post-outbreak, Maldives' tourism businesses made for, by large, the most prosperous sector. Collectively, the industry rakes in over 70 percent of the island nation's foreign receipts, annually.
The recent MMA findings concerning COVID19 impacts on locally-based businesses were sourced from a survey conducted during the second quarter of 2020. A total of 93 enterprises across the areas of tourism, construction, retail and wholesale, participated in the survey.
In addition to salary reductions, several companies in the tourism industry also reported redundancies. Only 26 percent of survey participants in the sector stating that there were no changes in employment.
Although businesses are reportedly expecting a comparative increase in tourism revenue for the third quarter, the survey indicated that overall, the outlook still remained negative.
The bleak forecast is largely attributed to the ongoing travel restrictions in countries representing considerable markets for Maldivian tourism. Whereas many countries have allowed citizens to travel abroad and despite Maldives own lax stance with quarantine, given the popular tourism destination's current COVID19 status, most countries have continued to impose mandatory quarantine for travellers upon return to their home nation - an issue that is proving unattractive to potential tourists.
As with numerous countries around the world, in the wake of the ongoing COVID-19 pandemic, Maldives closed its air and sea borders to tourist arrivals on March 27, halting the issuance of on-arrival visas. The closure of borders remained in place until June 15.
Heavily reliant on tourism for revenue, the restrictions on international travel left the country vulnerable to severe economic impacts. In mid-April, the World Bank projected that Maldives would be the worst-hit economy in the South Asian region due to the pandemic.
Maldives estimates a shortfall of approximately USD 450 million (MVR 6.9 billion) in foreign currency and a state deficit of MVR 13 billion in 2020 as a result of the COVID-19 pandemic's impact on the tourism industry.