Tourists To Lead Maldives' Recovery By Ian Gill  

MALE, MALDIVES (8 March 2005) - Ten weeks after the tsunami, tourists are beginning to arrive in the Maldives in greater numbers.

"Flights are fuller and hotels are reporting 50% occupancy, up from around 30% after the tsunami," says Richard Vokes, a director in ADB's South Asia Department who is helping to prepare ADB assistance for the Maldives.

This tiny Indian Ocean nation depends heavily on thousands of tourists, many from Europe, who are drawn to its spectacular atolls, groups of islands set amid sandy beaches, clear shallow waters and necklaces of coral.

Tourists helped this isolated country with few natural resources to triple its per capita income in over two decades to reach $2,400 in 2003, enabling it to graduate from "least developed" status last year.

Tourism is by far the biggest contributor to Maldives' gross domestic product - demonstrating not so much its strength as the vulnerability of an economy so dependent upon one sector.

That susceptibility was brutally exposed on December 26, 2004 when high waves washed over a country that is 1.5 meters above sea level at its highest point.

The tsunami affected one third of the country's 100,000 people. It destroyed many homes. It washed topsoil off agricultural plots and home gardens and saltwater covered the earth. Floodwater disrupted drinking water supply, contaminating wells and infiltrating freshwater aquifers.

The giant wave hit key sectors hard. It cut down fishing, which accounts for half of exports, after sweeping away fishing fleets on over 50 islands. It affected more than 100 agricultural islands.

But it hurt tourism most of all, causing direct damage of $100 million, according to a joint government-donor assessment. The next worst hit sector was housing at $65 million.

The tsunami damaged 20% of the country's 91 resorts - and tourist arrivals plunged. By end-January, the country counted only 7,600 tourists, a big drop from 17,000 at the same time a year earlier.

On the ground, the effects are distressingly clear, as ADB Vice President Liqun Jin and Mr. Vokes observed during a recent reconnaissance mission.

On Guraidhoo Island, part of the South Male atoll, lassitude hangs over the main street as shopkeepers wait for tourists, whose numbers have dwindled to a trickle. Fishermen sit around idle and dejected because the wave not only destroyed their homes and boats, but also closed down a nearby resort where tourists bought their catch.

The cash flow situation is serious for a Government faced with escalating costs for the relief effort and sharply reduced income. For ADB, Mr. Jin was able to reassure the Government in January that ADB will provide swift assistance of $20 million in grants for reconstruction and rehabilitation in 2005.

This is three times the amount of loan assistance that ADB provides to the Maldives in a year.

Key to Maldives' recovery is the swift return of tourists.

"Tourists may stay away, not because they fear another tsunami, but because they may think that services are at a low level because of the disaster," says Mr. Jin. "It's important to re-open the damaged resorts and lure the tourists back again through advertising."

Already, he notes, 80% of the resorts are now functioning normally.

Dr. Ralf Corsten, a former major tour operator who is now adviser to the World Tourism Organization, believes that, with proper marketing, the Maldives can recover from the tourist downturn in months rather than years.