An island resort in the Maldives. Photo: Siraphob Werakijpanich / Shutterstock

The tourism industry in the Maldives is still relatively young, only kicking off in the early 1970s. The small size of the country, along with the geographic constraints associated with the archipelago’s low sea level has made developing the tourism industry challenging. However, the rise of outbound Chinese tourism has proven a boon to the economy of the Maldives and its tourism industry. Unfortunately, the country’s tenuous political situation has put its tourism industry in peril and the Chinese government has issued a warning urging Chinese citizens to avoid travel to the country.

China is by far the Maldives’ most important tourism source market

It’s hard to deny that the Maldives is heavily dependent on Chinese travel. The country welcomed just over 300,000 Chinese tourists in 2017. A large figure considering that country attracted around 1.4 million foreign tourists in 2017 and that the country has a population of around 430,000.

However, Chinese tourism declined in 2017 compared to 2016 by 5.5 percent. In fact, Chinese tourism to the Maldives has been in decline since 2014 when it peaked at 360,000. Overall foreign tourism arrivals, nonetheless, have continued to grow.

Ease of travel has been a key driver of Chinese tourism to the Maldives, with Chinese passport holders able to obtain a visa on arrival.

The Maldives is primarily a luxury tourism destination, centered around big budget island resorts. However, ecotourism is also an increasingly important sector given the country’s environmental concerns.

Chinese tourism to the Maldives has been in decline since 2014

The country’s ongoing political instability continues to threaten the tourism revenue of the Maldives. Currently, Maldivian president Abdulla Yameen is locked in a battle with the country’s courts over the overturned terrorism convictions for 8 opposition figures and former president Mohammed Nasheed. Yameen responded by firing two police chiefs.

The attorney general, Mohammed Anil, responded to a report that the country’s supreme court intends to remove Yameen by iterating the army and the police will refuse to carry out such an order.

A state of emergency has been declared and military forces reportedly entered the supreme court. The army has been ordered to resist any efforts to impeach Yameen.

With their dependence on Chinese tourism dollars, this latest warning is a heavy blow to the country’s economy with the upcoming Spring Festival/Chinese New Year holiday, the peak period of Chinese travel for the Maldives.

The long-term damage to the image of the Maldives as a destination may be more costly than the drop in Chinese arrivals over the Spring Festival

Of course, the short-term costs of a drop in Chinese tourism may pale in comparison to the long-term damage that this political instability could have on the attractiveness of the Maldives as a tourism destination. Safety is a big concern for all tourists, but Chinese outbound tourists are particularly sensitive to such concerns.