maldives tourism case study

The changing face of tourism and work: How Maldives is successfully adapting to the pandemic

Valerie mercer-blackman.

It’s December 2023. Rita, a young businesswoman, has just finished meeting with clients in Chennai, India and anticipates meeting friends in Singapore for the holidays two weeks later. An employer-sponsored hybrid work model allows her to work from anywhere. She chooses to work at a guesthouse in Male, Maldives thanks to great Internet connectivity while spending time absorbing the local culture and South Asian cuisine, even trying her hand at snorkeling. Pre-COVID-19, she would have had to fly back from Chennai, India to snowy Chicago where she resides; go to the office for 10 days; work fighting an arduous jetlag; and then fly back East almost 10 thousand miles to Singapore. Now not only is she significantly reducing her carbon footprint, but she also feels revitalized after her stay in the Maldives, and is happier and more productive. Not to mention, she has contributed to Maldives’ tourism industry.

Is Rita’s practical yet creative twist on work-life balance indicative of the future of tourism—and work? 

According to various measures in the World Bank’s latest South Asia Economic Focus (SAEF), the region’s tourism heavy nations—Maldives, and to a lesser extent Nepal, Sri Lanka, and Bhutan—are well poised to take advantage of new services and digital technologies along with a new-found need for wellness post-pandemic, to boost their economies  . See a prior blog on services as the driver of development in South Asia.

Tourism: Savior for a Post COVID Economy?

Before COVID-19, tourism was among the fastest-growing sectors in Maldives and Bhutan, with a growth rate that outpaced GDP growth rates. The pandemic and related stringent measures hit all South Asian countries dependent on tourism hard, leading to a deep contraction in GDP in 2020.  According to the World Travel and Tourism Council , the entire global tourism industry, particularly business travel, was devastated by the pandemic.   Business spending decreased by 61 percent from 2019 to 2020 compared to 49 percent for leisure travel. Business travelers on average spend much more than leisure and domestic travelers, making the recovery of business spending essential for the entire travel sector. As the industry struggles to recover, there is also great uncertainty about how the future of work could transform the demand for travel, and many expect international business travel to be the last segment to recover as it is most sensitive to travel restrictions.

However, despite these uncertainties, our analysis in the South Asia Economic Focus shows that tourism has the potential to be a fast-growing sector post-COVID amidst new remote work possibilities and changing travel behaviors:

• The desire for travel is strong, spurred by the pent-up demand in leisure travel, which has been driven by new hybrid work environments and household savings during the pandemic. 
• As remote work becomes a long-term reality, more than half of the global tourists have expressed interest in extending business trips or working remotely in tourism destinations while enjoying leisure time.
• There is also evidence of an increase in the average duration of stay by 2.4 days since 2020, according to Tourism Status Updates by the Ministry of Tourism Maldives.
• The ravaging effects of COVID-19 on mental health may also increase the demand.
• COVID-19 is changing tourists’ attitudes and behaviors. According to recent online surveys by booking.com , more than half of global travelers, particularly younger travelers, started looking for travel plans that were more sensitive to the environment and local communities, including staying away from crowded tourist attractions and exploring lesser-known destinations.

South Asian countries already have a comparative advantage in developing niche tourism and ecotourism, as they are endowed with diverse natural and cultural resources. Therefore, small and tourism-dependent countries can view the pandemic as an opportunity to unleash the potential of tourism and pave the way for sustained growth going forward. 

Maldives: Setting the Bar High in Tourism

Maldives has been exemplary in its resilience and ability to recover. In 2021, visitor arrivals reached more than 80 percent of pre-COVID levels, far outpacing other similar tourist destinations. 

These are some lessons we can draw from Maldives’ spectacular recovery in the tourism sector:

• First, the government’s policies and interventions around the border restrictions and health regulations play an important role in the recovery of the tourism sector.  For example, Maldives took a concerted effort to reopen its border to tourists as early as July 2020 but implemented strict hygiene protocols for tourists, including one of the fastest COVID-19 vaccination campaigns in the world. This has improved the confidence of travelers and has created high-value consumers.
• Second, Maldives quickly made an effort to capture new source markets and expand to new countries of origin. For example, the emerging source of the international tourist market from Russia and India—in part arbitraging quarantine rules—has compensated for the tourism revenue loss from China, its top source market before the pandemic.
• Third, Maldives is seizing changing preferences to promote a better image. In 2020, Maldives launched a marketing campaign with the tagline “ Isolation never looked this good ” to emphasize its unique reputation of being a niche destination, while emphasizing environmentally sustainable tourism.
• Fourth, it is investing in digital technology as the demand for high-speed internet and contactless services rise due to the pandemic. In Maldives, more than 60 percent of the population has access to broadband Internet—with relatively high bandwidth speed—while other tourism-dependent South Asian countries are still lagging  , limiting the possibilities to meet travelers’ need for working remotely. Moreover, digital platforms will be important in minimizing physical interaction when traveling, while still fulfilling travelers’ needs. For example, one of the luxury resort in Maldives, has developed an app to facilitate contactless services including ordering food, virtual check-in and check-out, and other amenities to adapt to changing customer behaviors.

Adapt or perish? Maldives is choosing the former. It behooves other South Asian nations to pay attention as they build back resiliently post COVID-19.

• Digital Development
• COVID-19 (coronavirus)

Lead Economist

Join the Conversation

• Share on mail
• comments added

• Get Involved

Reimagining Tourism

This project aims to diversify the tourism offer in the Maldives by targeting the actors involved and ideal market of the guest house segment.  It will leverage community-led conservation of natural ecosystems and cultural heritage as a novel tourism product to facilitate a bigger role for local councils in tourism planning. This will establish formal linkages in the tourism sector with traditional knowledge and livelihoods, leading to the creation of avenues for greater participation for women and youth.

This project will facilitate pathways and provide incentives for small and medium enterprises  (i.e., guesthouses and other complimentary enterprises) to pursue and maximize social, economic and environmental benefits. This will be achieved through three outputs: focusing on integration of tourism development into island development planning processes; acceleration of digitization efforts within the guesthouse tourism segment, with a focus on enhancing access to information and marketing of local island tourism offers; and prototyping of sustainable business models for local tourism. 

As a tourism dependent country, the economy of the Maldives was severely affected due to the COVID-19 pandemic.  With the complete shutdown of tourism for three months in 2020, forecasts by the Ministry of Finance anticipated a contraction in GDP in the range of -11.5 to -29.7 percent in a worst-case scenario for 2020. The Rapid Livelihood Assessment on the impact of the COVID-19 crisis in the Maldives reveals that the halt in tourism impacted the lives of tourism industry workers gravely and had a drastic spillover effect on construction, transport, wholesale, and retail businesses. Among the multiple segments of tourism impacted, guesthouses were especially hit hard. 

Currently the guesthouse segment of 616 establishments is estimated to be worth MVR 2.2 billion by the end of 2019, which contributes an estimated 4% to the tertiary sector economic activity. The guesthouse segment is dominated by Small and Medium Enterprises (SMEs) with majority local ownership. According to a recent study by Guesthouse Association of Maldives (GAM) 36% of guesthouses are financed through personal loans and more than half through loan facilities. With the impact of COVID-19, guesthouses are expected to incur an aggregate loss of $28.9 million between April to September. This is a significant shock to the economies of the guesthouse dependent islands. GAM indicated that guest houses provide 80% of direct employment benefits to communities in which they operate. The SMEs in the islands provide complimentary services ranging from transport, recreation, logistics etc. to support these guesthouses.   

The ongoing pandemic has exposed structural vulnerabilities in the tourism industry which affect both supply and demand factors. This, coupled with the country’s increasing exposure to climate change related risks, obligates the country to pivot the current trajectory of its tourism industry to a more sustainable one. This project aspires to contribute to the recovery of the Maldivian tourism industry, while using the opportunity to make it more resilient through investments to ensure sustainability and inclusivity. 

Major Achievements

• Launching of the tourism website (islands.mv) to market local island tourism opportunities and services. It has given all 189 inhabited islands of the Maldives to freely market their tourism offer.  

Project Outcome

This project aims to:  

Build capacities and establish formal systems to integrate development of sustainable tourism into island planning efforts; 

Enhance access to information and market local island tourism offers through support. In doing so, it digitally maps and markets the natural and cultural ecosystem of the Maldives as unique product offerings from guest house on the main marketing portal for Maldivian tourism; 

Prototype sustainable business models for local tourism, including through the offer of regional and sub regional product offers, reskilling Maldivians for green/blue jobs in the industry, establishment cross sector value chains focusing on women entrepreneurs, and creation of sustainability standards for the guesthouse segment.  

GESI Component:

• Re-skilling and training programme: this programme caters to localized training needs in particular for women and youth in Laamu Atoll. This programme provides equal opportunities for women to branch out to different sectors of work.  

Business Incubator Programme: facilitates access to finance, banking services, and learning for entrepreneurs seeking to contribute to the tourism sector value chains- there is a focus on engaging women entrepreneurs. By facilitating and encouraging women to start their own business ventures, it increased the  number of women entrepreneurs in Laamu Atoll.  

Maldives Tourism

• Living reference work entry
• Latest version View entry history
• First Online: 05 February 2022
• Cite this living reference work entry

• Aishath Shakeela 3  

12 Accesses

The Republic of Maldives, comprised of 1192 coralline islands formed as 26 atolls, is located south of the Indian subcontinent (Fig. 1). The land area is 298 km 2 (115.06 mi 2 ), and the islands are less than three meters above sea level. The population of 557,426 (includes 178,156 expatriates) reside on 187 islands (National Bureau of Statistics 2020 ). Tourism contributes 26% to GDP, with receipts accounting US$3.2 billion in 2019, making it the highest economic sector (Ministry of Tourism 2020 ).

Since the inception of tourism in 1972, the industry has grown exponentially, replacing the primary fishing economy. Development is guided by a series of master plans, where regulations require operators to employ 50% locals. However, due to sociocultural and economic factors, including low wages and local’s unwillingness to work in an enclave resort, meeting this remains a challenge (Shakeela et al. 2010 ). The primary tourism education and training body is the government-run Faculty of...

This is a preview of subscription content, log in via an institution to check access.

Access this chapter

Institutional subscriptions

Ministry of Tourism. 2020. New developments: Tourist facilities under development in Maldives. https://www.tourism.gov.mv/en/registered/new_developments . Accessed 12 Feb.

National Bureau of Statistics. 2020. Statistical yearbook of Maldives 2020 . Male’: Ministry of National Planning and Infrastructure.

Google Scholar  

Shakeela, A., and S. Becken. 2015. Understanding tourism leaders’ perceptions of risks from climate change: An assessment of policy-making processes in the Maldives using the social amplification of risk framework. Journal of Sustainable Tourism 33: 65–84.

Article   Google Scholar  

Shakeela, A., and D. Weaver. 2018. “Managed evils” of hedonistic tourism in the Maldives: Islamic social representations and their mediation of local social exchange. Annals of Tourism Research 71: 13–24.

Shakeela, A., L. Ruhanen, and N. Breakey. 2010. Women’s participation in tourism: A case from the Maldives. In Tourism in the Muslim world , ed. N. Scott and J. Jafari. London: Emerald.

Download references

Author information

Authors and affiliations.

Griffith University, Southport, Australia

Aishath Shakeela

You can also search for this author in PubMed   Google Scholar

Corresponding author

Correspondence to Aishath Shakeela .

Editor information

Editors and affiliations.

School of Hospitality Leadership, University of Wisconsin-Stout, Menomonie, WI, USA

Jafar Jafari

School of Hotel and Tourism Management, The Hong Kong Polytechnic University, Hong Kong, Hong Kong

Honggen Xiao

Section Editor information

University of the Sunshine Coast, Queensland, Australia

Rights and permissions

Reprints and permissions

Copyright information

© 2022 Springer Nature Switzerland AG

About this entry

Cite this entry.

Shakeela, A. (2022). Maldives Tourism. In: Jafari, J., Xiao, H. (eds) Encyclopedia of Tourism. Springer, Cham. https://doi.org/10.1007/978-3-319-01669-6_281-3

Download citation

DOI : https://doi.org/10.1007/978-3-319-01669-6_281-3

Received : 12 February 2021

Accepted : 15 July 2021

Published : 05 February 2022

Publisher Name : Springer, Cham

Print ISBN : 978-3-319-01669-6

Online ISBN : 978-3-319-01669-6

eBook Packages : Springer Reference Business and Management Reference Module Humanities and Social Sciences Reference Module Business, Economics and Social Sciences

• Publish with us

Policies and ethics

Chapter history

DOI: https://doi.org/10.1007/978-3-319-01669-6_281-3

DOI: https://doi.org/10.1007/978-3-319-01669-6_281-2

DOI: https://doi.org/10.1007/978-3-319-01669-6_281-1

• Find a journal
• Track your research

The state of tourism and hospitality 2024

Tourism and hospitality are on a journey of disruption. Shifting source markets and destinations, growing demand for experiential and luxury travel, and innovative business strategies are all combining to dramatically alter the industry landscape. Given this momentous change, it’s important for stakeholders to consider and strategize on four major themes:

• The bulk of travel is close to home. Although international travel might draw headlines, stakeholders shouldn’t neglect the big opportunities in their backyards. Domestic travel still represents the bulk of travel spending, and intraregional tourism is on the rise.
• Consumers increasingly prioritize travel—when it’s on their own terms. Interest in travel is booming, but travelers are no longer content with a one-size-fits-all experience. Individual personalization might not always be practical, but savvy industry players can use segmentation and hypothesis-driven testing to improve their value propositions. Those that fail to articulate target customer segments and adapt their offerings accordingly risk getting left behind.
• The face of luxury travel is changing. Demand for luxury tourism and hospitality is expected to grow faster than any other travel segment today—particularly in Asia. It’s crucial to understand that luxury travelers don’t make up a monolith. Segmenting by age, nationality, and net worth can reveal varied and evolving preferences and behaviors.
• As tourism grows, destinations will need to prepare to mitigate overcrowding. Destinations need to be ready to handle the large tourist flows of tomorrow. Now is the time for stakeholders to plan, develop, and invest in mitigation strategies. Equipped with accurate assessments of carrying capacities and enhanced abilities to gather and analyze data, destinations can improve their transportation and infrastructure, build tourism-ready workforces, and preserve their natural and cultural heritages.

McKinsey Live event: Faces, places, and trends: The state of tourism & hospitality

Thursday, June 13 at 10:30 a.m EDT / 4:30 p.m CET

Now boarding: Faces, places, and trends shaping tourism in 2024

Global travel is back and buzzing. The amount of travel fell by 75 percent in 2020; however, travel is on its way to a full recovery by the end of 2024. More regional trips, an emerging population of new travelers, and a fresh set of destinations are powering steady spending in tourism.

There’s no doubt that people still love to travel and will continue to seek new experiences in new places. But where will travelers come from, and where will they go?

We share a snapshot of current traveler flows, along with estimates for growth through 2030.

The way we travel now

Which trends are shaping traveler sentiment now? What sorts of journeys do today’s travelers dream about? How much are they willing to spend on their trips? And what should industry stakeholders do to adapt to the traveler psychology of the moment?

To gauge what’s on the minds of present-day travelers, we surveyed more than 5,000 of them. The findings reveal disparate desires, generational divides, and a newly emerging set of traveler archetypes.

Updating perceptions about today’s luxury traveler

Demand for luxury tourism and hospitality is expected to grow faster than for any other segment. This growth is being powered in part by a large and expanding base of aspiring luxury travelers with net worths between $100,000 and $1 million, many of whom are younger and increasingly willing to spend larger shares of their wealth on upscale travel options. The increase is also a result of rising wealth levels in Asia.

We dug deeper into this ongoing evolution by surveying luxury travelers around the globe about their preferences, plans, and expectations. Some widely held notions about luxury travelers—such as how much money they have, how old they are, and where they come from—could be due for reexamination.

Destination readiness: Preparing for the tourist flows of tomorrow

As global tourism grows, it will be crucial for destinations to be ready. How can the tourism ecosystem prepare to host unprecedented volumes of visitors while managing the challenges that can accompany this success? A large flow of tourists, if not carefully channeled, can encumber infrastructure, harm natural and cultural attractions, and frustrate locals and visitors alike.

Now is the time for tourism stakeholders to combine their thinking and resources to look for better ways to handle the visitor flows of today while properly preparing themselves for the visitor flows of tomorrow. We offer a diagnostic that destinations can use to spot early-warning signs about tourism concentration, along with suggestions for funding mechanisms and strategies to help maximize the benefits of tourism while minimizing its negative impacts.

Six trends shaping new business models in tourism and hospitality

As destinations and source markets have transformed over the past decade, tourism and hospitality companies have evolved, too. Accommodation, home sharing, cruises, and theme parks are among the sectors in which new approaches could present new opportunities. Stakeholders gearing up for new challenges should look for business model innovations that will help sustain their hard-won growth—and profits.

Unbundling offerings, cross-selling distinctive experiences, and embracing data-powered strategies can all be winning moves. A series of insight-driven charts reveal significant trends and an outlook on the future.

RELATED ARTICLES

The future of tourism: Bridging the labor gap, enhancing customer experience

The promise of travel in the age of AI

From India to the world: Unleashing the potential of India’s tourists