Tourist arrivals increase 4.3 percent in first quarter

Tourist arrivals increased by 4.3 percent in the first three months of 2017 as growth from traditional European markets offset a continuing decline in Chinese holidaymakers.

According to statistics released by the tourism ministry last week, 359,053 tourists visited the Maldives during the first quarter, up from 344,166 in the same period last year.

Arrivals grew by 15.6 percent in January, the peak season for the industry which also coincided with the Chinese New Year. But the growth rate was marginal in February at 0.3 percent and registered a 2.1 percent decline in March.

Revenue from the tourism goods and services tax also increased from US$79 million in the first quarter of 2016 to US$85 million this year.

Some 1,286,135 tourists visited the Maldives in 2016, growing 4.2 percent from the previous year but falling short of the government’s revised target of 1.4 million visitors, the same target that was missed in 2015.

China meanwhile remains the largest source market despite a 7.8 percent dip during the 2017 first quarter. As of March, some 73,135 Chinese tourists visited Maldives, compared to 79,312 during last year’s first quarter.

Reflecting the unchecked decline, the market share of Chinese tourists fell to 20.4 percent, down from 25 percent last year.

Tourism Minister Zameer told China’s Xinhua news agency last week that the Maldives plans to launch an aggressive tourism promotion campaign in several Chinese cities this year with an ambitious goal of attracting one million tourists.

The government is also planning to send a team of civil and island aviation authorities to China to discuss increasing the number of flights, he said.

On May 2, Mega Maldives Airlines, which pioneered direct flights between China and Maldives in 2010, temporarily suspended commercial flight operation, citing an ongoing “restructuring and recapitalisation” process.

Mega Maldives CEO George Weinmann said the airline looks forward to returning to flying soon with a renewed fleet that can serve “established, under-served and emerging markets.”

Flight crew are on paid leave, an employee told the Maldives Independent.

The airline also announced layoffs and restructuring plans last August following a shortfall in revenue caused by the slowdown of the Chinese market. But the laid-off staff were later re-hired.

Arrivals from European markets meanwhile registered modest growth during the first quarter.

The number of Italian holidaymakers grew robustly by 22 percent but arrivals from two key European markets, the United Kingdom and Germany, decreased by 1.1 percent and 11.4 percent, respectively, during January to March.

The Russian market, however, has rebounded with a strong growth rate of 41.5 percent in the first quarter, reaching 18,400 tourists compared to 13,007 tourists last year.

Arrivals from France, which have been declining in recent years, also grew by 2.6 percent and reached 16,845 tourists.

Tourist arrivals from India meanwhile continued to grow with a 21.1 percent increase compared to the 2016 first quarter.

Tourist arrivals from the giant neighbour grew by a whopping 30 percent in 2016, representing a market share of 5.2 percent. According to Indian media, the Maldives was the ultimate holiday destination for Bollywood celebrities in 2016.

The statistics also showed that tourists spent an average of 5.6 days in Maldives between January and March, down from 5.8 days last year.

The occupancy rate at resorts during the first quarter was 76.9 percent, down from 83.8 percent last year.

As part of efforts to promote the Maldives, Tourism Minister Zameer meanwhile launched an international TV channel created by the state media corporation Public Service Media at this year’s ITB Berlin fair in March.

The channel aims to promote Maldives tourism to global viewers and offers an opportunity for resorts, hotels, guesthouses, travel agencies and airlines to promote their brand.

“The content of Maldives TV comprises of targeted programs, video clips and documentaries, where the world can experience the hypnotic beauty, mouthwatering cuisine, the rich marine life, culture, history and lifestyle of the locals,” PSM said.

The Maldivestv.mv channel is also available for live streaming.

According to the Maldives Marketing and Public Relations Corporation, some 280 representatives from 88 companies from the Maldives participated in the Berlin fair, the world’s largest travel exhibition, which took place from March 8 to 12.

The Maldives stand showcased cultural dances, music by local musicians, a spa experience, and Maldivian food. The stand also printed names of visitors on t-shirts in the local Dhivehi language and offered an opportunity to experience the Maldives through virtual reality.

Ahead of the Berlin fair, the Maldives Association of Tourism Industry, an influential lobbying group representing resort owners, had called on the government to increase destination marketing activities.

“While arrivals tipped just above 2015 figures, the same cannot be said about yield,” MATI Chairman Mohamed Umar Manik said at the organisation’s annual general assembly in February.

Despite the 4.2 percent annual growth in arrivals, revenue from T-GST last year decreased by -4.4 compared to 2015, suggesting shorter stays and lower spending by tourists.

The tax authority collected US$258 million as T-GST during 2016, down from US$270 million.

In his remarks, MATI Secretary-General Ahmed Nazeer said the industry is finding it harder to live up to expectations as the main driver of economic growth.

“We are barely able to keep occupancy at satisfactory levels while a pattern is emerging across the industry of falling revenues,” he said.

“External factors are the major contributor to this pattern.”