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Maldives as tourist hub: Its history and what lies ahead for island nation

Maldives, with a population of 550,000 people dispersed across 185 islands, has become a popular tourist hub in the last five decades and today attracts about 25% of its GDP directly from tourism

Maldives, one of the navy’s close maritime partners, has been a regular participant at MILAN — a week-long festival of discussions, band and cultural displays, sports events and cocktail parties, all to assert regional camaraderie

Maldives' annual GDP is largely driven by its tourism sector, which accounts for about 25 per cent of total share.

BS Web Team New Delhi

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The Maldives, officially the Republic of Maldives, stationed strategically in the heart of the Indian Ocean, remains one of the most sought-after tourist destinations in the world. The island nation, spanning across the equator, boasts an influx of lakhs of tourists every year and recorded as many as 1,757,939 visitors' arrivals till early December 2023, an impressive 12.6 per cent jump compared to 2022.

Maldives, with a population of 550,000 people dispersed across 185 islands, has capitalised on its geographical location to transform itself into a popular tourist destination in the last five decades. According to the Asian Development Bank, tourism's contribution in Maldives stood at 13 per cent in 1980. However, the government's push for development of the sector has resulted in its contribution being increased to about 25 per cent today with a projected indirect contribution of 79 per cent in 2022. 
 

Maldives' history as tourist destination

The South Asian island country spreads across 90,000 square kilometres. However, only 298 sq km of that is dry land. The tourism industry began to take shape there in the 1970s with the arrival of Italian travel enthusiast George Corbin, industry enthusiast Ahmed A. explains in a collaborative article on social media platform LinkedIn.

"As soon as they returned from the Maldives (In 1971), Corbin published articles on his new found adventure destination. They also wrote a book called Duemila isole felici, which was published in 1973," he said.

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Corbin and his companions realised the potential of the island Vihamanaafushi in the Maldives and began with the construction of a single resort on an inhabited island in 1972. By 1977, the country had its first-ever travel agency - Muman Agency.

Several challenges persisted in the infrastructure development, including recovering from the impact of the Second World War, however, with Corbin's expertise and local efforts, the journey to establish Maldives as a tourism destination began.

Maldives tourism: Boon and a bane

A World Bank report published on Maldives in October 2023 has highlighted how, due to heavily being dependent on tourism, Maldives also faces threats of macroeconomic and external shocks. "Overall, sustained growth performance driven by tourism in the last decade has significantly reduced poverty, and Maldives performs well on poverty outcomes compared to its regional, income, and small island peers," the international agency states. However, it noted that "Heavy reliance on tourism and limited sectoral diversification remain key structural challenges as Maldives is highly vulnerable to macroeconomic shocks." The country faces high inflationary pressures due to the sharp rise in global commodity prices.

To promote development, Maldives has scaled up infrastructure investments since 2016. However, its public finances remain under pressure as the 2023 budget's proposal over subsidy reforms was not implemented, and capital spending cuts did not happen.

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Maldives may 'disappear' by 2100

On the climate risk front, Maldives is set to lose most of its land area by the year 2100, according to a projection made by the United Nations Environment Programme (UNEP). The estimates suggest that the Maldives' will witness a sea-level rise of 0.5-0.8 metres, posing a massive risk to the lowest-lying country in the world.

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First Published: Jan 08 2024 | 12:35 PM IST

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