Business & Tourism
Tourist arrivals register double-digit growth in November
Despite tourist arrivals growing by 4.6 percent annually as of November, revenue from Tourism Goods and Services Tax last year decreased by -4.4 compared to 2015, suggesting shorter stays and lower spending by tourists.
The peak season of the Maldives’ tourism industry began in November with a robust 16 percent growth in arrivals during the month compared to the same period in 2015.
According to statistics released by the tourism ministry earlier this week, tourist arrivals reached 1.1 million at the end of November, up 4.6 percent from the previous year as arrivals from traditional European markets continued to register significant growth.
However, despite the increase in arrivals, revenue from Tourism Goods and Services Tax 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.
Reflecting the revenue shortfall, the average occupancy rate of the industry fell -0.8 percent during the year to 68.3 percent at the end of November. The occupancy rate at resorts stood at 74.4 percent.
The average duration of stay fell marginally from 5.7 days in 2015 to 5.6 days last year.
A steep decline in the number of Chinese holidaymakers also continued in November, falling -4.5 percent during the month compared to the corresponding period in 2015.
After growing exponentially from 2010 onward to capture a market share of 30 percent, Chinese arrivals peaked in 2014 with about 364,000 visitors and declined for the first time in 2015 by -1.1 percent.
The trend continued last year with a sharp decline of -10.2 percent as of November. A total of 308,077 Chinese tourists visited the Maldives from January to November, down from 343,259 visitors the previous year.
However, with a market share of 26.4 percent, China remains the largest source market for the Maldives.
After China, Germany has the highest market share with 8.4 percent, followed by the United Kingdom (8 percent), Italy (5.1 percent), India (4.9 percent), Russia (3.4 percent), and France (3.1 percent).
With a total of 57,264 visitors as of November, Indian tourists increased by a whopping 28.1 percent last year. According to Indian media, the Maldives was the ultimate holiday destination for Bollywood celebrities in 2016.
Arrivals from the UK, Germany, and Italy meanwhile grew respectively by 15.3 percent, 12.6 percent, and 11.1 percent in November.
Of the other top markets, arrivals from Russia and France had registered significant declines in 2015, falling 33.2 percent and 17 percent respectively.
Arrivals from France continued to decline in 2016 with a fall of -3.5 percent as of November. However, the Russian market rebounded with a 6.3 percent growth in arrivals from January to November.
A total of 104,572 tourists visited the Maldives in November as the tourism industry geared up for the high season, which coincides with the European winter and the busy Christmas-New Year period.
Meanwhile, in September, Tourism Minister Moosa Zameer had conceded that the government will miss its target of attracting 1.5 million tourists during 2016.
He said the revised target is 1.4 million arrivals, the same target that was missed in 2015.
Zameer blamed the opposition’s alleged scaremongering about religious extremism in the Maldives for the underperformance of the tourism industry, which was also cited as the reason for slower-than-anticipated GDP growth last year.
The minister said the government has been increasing marketing expenditure to counter the opposition’s claims by hiring public relations firms and consultants.
The opposition was previously accused of conducting a tourism boycott campaign at the ITB Berlin travel fair in March. But opposition MPs strongly denied the allegation at the time, contending that tourist arrivals slowed down in 2015 due to the widely-condemned imprisonment of opposition leaders and the declaration of a state of emergency in November 2015.
At the ITB convention – the world’s largest travel and trade exhibition where the Maldives was last year’s official partner country – Zameer had also lambasted “scare stories of religious extremists threatening tourists”.
But European tour operators who spoke to the Maldives Independent after the six-day state of emergency suggested that years of bad press about political turmoil coupled with the dearth of mid-range hotels was undermining the Maldives’ attractiveness as a destination.