DTIS, Volume I - Enhanced Integrated Framework (EIF)

Similarly, considerable demand was placed on the construction industry after the
December 2004 tsunami, where as many as 21 out of the total of 87 resorts were affected.
During the DTIS mission, eight months after the tsunami, 11 resorts were still closed for
repairs. Seven more were undergoing significant renovations. These periodic pressures on
the construction industry often result in the need to use expatriate labour.
FISHERIES AND HORTICULTURE
While fresh fish and fish products are supplied to the tourism sector, the supply of local
fruit and vegetables is less reliable. A key constraint is obviously limited land availability
for cultivation.
HANDICRAFTS
A characteristic of most handicraft production is that it normally uses a high proportion
of local inputs, material and labour, often as high as 100 per cent. However, as the
Maldives is a relatively high wage economy, locally produced handicraft tends to be
over-priced as compared to mass-produced souvenir items from the Southeast Asian
countries.
D. CONTRIBUTION TO FOREIGN EXCHANGE EARNINGS
International tourism is characterized by consumers coming to the destination to consume
tourism services on the spot. International tourists pay foreign exchange for the services
they consume e.g. accommodation, meals, drinks, domestic transport services, excursions
and tours, leisure activities, souvenirs and general shopping. They pay either at the
destination or for certain services in advance of traveling. Nevertheless, the payments
made by the tourists eventually accrue to the providers and operators of the services
consumed.
Tourism in the Maldives is characterized by a high degree of pre-travel payment, since a
high proportion of tourists come to the Maldives on package tours that are traditionally
bought in their home countries before travel. In addition to the international air transport,
package tour will by definition include one or more services in the host destination,
normally accommodation and meals, as well as transfers, tours, etc. The proportion of the
package price that is transferred to Maldivian operators, together with the amount that the
tourists spend while in the Maldives constitutes the total earnings from international
tourism. This is also internationally referred to as the total tourism receipts.
Taking into account annual tourist arrivals, average length of stay, as well as estimates of
average daily spending by tourists, the value of international tourism is estimated by the
Maldives Monetary Authority (MMA) at almost USD 480 million in 2004. While it is
believed that this estimate under values the real foreign exchange earnings from tourism,
it is nonetheless more than three times as high as the country’s total visible export
earnings from all other economic sectors of approximately USD 123 million, of which
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