President Ibrahim Mohamed Solih on Sunday ratified the 10th amendment to the Maldives Tourism Act (Act No. 2/99), which grants him the power to allocate islands for tourism development.
The amendment, which was approved by the parliament on December 7, states that the president may allocate islands to develop resorts, guesthouses, hotels and yacht marinas, for integrated tourism development and tourism-related real estate projects, and other ventures concerning the travel sector.
However, the newly ratified amendment does not curb the powers vested in local councils to allocate areas for tourism development within their constituencies.
"Island Councils retain the authority to do so in inhabited islands or cities which lie under their administrative jurisdiction, under the provisions of the Decentralisation Act and in accordance with approved land-use plans", noted the President's Office.
Furthermore, the Tourism Act states that the guidelines under which the government may sell shares from tourist properties, where the government holds shares, under a joint-venture agreement with private investors. Per the guidelines, the government may sell shares held under Joint-Venture Agreements to other shareholders of the same property, at a fixed rate of USD 5 per square meter.
The government recently disclosed that new islands will be marketed for tourist resort development. The Ministry of Tourism had planned to put 20 islands on the market prior to the COVID-19 pandemic.
The Maldivian economy being heavily reliant on tourism, the global repercussions of COVID-19 on global and local travel have left the country in a vulnerable state. In mid-April, the World Bank projected that Maldives would be the worst-hit economy in the South Asian region due to the pandemic.
The island nation reopened its borders to international passengers on July 15, after nearly four months since the state halted issuing on-arrival visas on March 27. Guesthouses were permitted to resume operations and kick start local tourism on October 15.
Although Maldives has noted a significant reduction in tourist arrivals compared to pre-COVID figures, there has been a gradual increase with the establishment of travel bubbles between Maldives and other countries, as well as greater connectivity in terms of flight operations.
On December 12, Maldives recorded the arrival of the 100,000th tourist following the removal of travel restrictions. Five days after the milestone was reached, the government welcomed 500,000th tourist for the year 2020.
It is anticipated that arrival rates to the tropical Republic are set to peak during the year 2021.
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