Maldives Political Unrest Leaves Local Tourism Industry High and Dry

After the Maldivian government declared a state of emergency earlier this month, tourists around the world are canceling their beachfront vacations in droves.

The blow to the Maldives' tourism industry is significant, as it accounts for over 30% of the country's gross domestic product, reaching $3.5 billion in 2017. Ratings agency Moody's has said it will lower its 4.5% growth forecast for 2018 if tourists avoid the island nation for a prolonged period.

"We have had about 50-60 room cancellations per day, and the number is consistent since [the political unrest] started," said a spokesman for Paradise Island Resort-Villa Group. "This is the same for all of our properties in the country."

The 282-room Paradise Island Resort-Villa is a 20-minute speedboat ride from Malé, the island capital of the Maldives where the political turmoil is taking place. Velana International Airport (MLE), the inbound hub for most resort-bound travelers, is also located in Malé.

The US Department of State has raised its Maldives travel advisory to Level 2: "Exercise increased caution." Other nations have issued similar warnings for their citizens. The current travel advice regarding the Maldives issued by the British Foreign and Commonwealth Office (FCO) reads:

"On 5 February 2018, the Maldives government declared a state of emergency. Security forces have been deployed in the capital Malé in response to political developments. If you're in Malé, you should exercise caution and avoid any protests or rallies. There are no reports that outlying islands, resorts or Malé International Airport are affected.

Political protests and demonstrations often take place in Malé. Some have led to violence and arrests. You should take appropriate security precautions, comply with local security requirements and avoid protests and rallies."

Reuters reported that the biggest drop-off in tourism revenue has come from China and India.

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"We have a higher market for Chinese and Indian travelers, and we are seeing most of the cancellations from these markets," a tour operator in Malé told the news agency anonymously for fear of upsetting the government. The tour operator said that, since the crisis began, early estimates indicate a 20-25% increase in cancellations over the usual volume of this season.

An estimated 300,000 Chinese travelers vacation in Maldives every year, comprising around 20% of the country's annual 1.4 million tourists. Air India, India's SpiceJet, China Eastern Airlines and China Southern Airlines have allowed customers to cancel or change their tickets at no cost over specific dates during February.

Indian tourists are directing their attention toward Sri Lanka and Seychelles over Maldives, leading to a 20-40% increase in bookings to the other beach destinations in the past two weeks, according to local tour operators.

We've reached out to the Maldivian Board of Tourism for follow-up, although no official word has been issued since the initial announcement on February 6.

For now, US-based tourists are most likely safe, but would do well to follow these guidelines from the Department of State:

• Avoid demonstrations and crowds.
• Monitor local media for breaking events and be prepared to adjust your plans.
• Be aware of your surroundings.
• Stay alert in locations frequented by Westerners.
• Enroll in the Smart Traveler Enrollment Program (STEP) to receive Alerts and make it easier to locate you in an emergency.
• Follow the Department of State on Facebook and Twitter.
• Review the Crime and Safety Report for Maldives.
• U.S. citizens who travel abroad should always have a contingency plan for emergency situations. Review the Traveler's Checklist.