MP Mauroof questions feasibility of government’s 40% dollar deposit plan for resorts

Kendhoo MP Mauroof Zakir says the government is attempting to enforce a major change to the tourism dollar system without adequate research or consultation with industry experts.

Speaking on SSTV’s Baaru Hathareh programme on Tuesday evening, Mauroof criticised the government’s plan to require resorts to sell or deposit 40 percent of their US dollar revenue to the Maldives Monetary Authority (MMA). He said the policy was being rushed without proper assessment of its economic impact.

Mauroof argued that the most effective long-term solution to the dollar shortage is increasing Maldivian participation in the tourism workforce. He noted that the government itself has said that a shift toward a digitalised economy would make it easier for Maldivians to work remotely in tourism-related roles, many of which are currently filled by foreigners both in resorts and off-site.

He said that while replacing foreign workers with Maldivians would not completely solve the dollar problem, it remains one of the most important structural reforms needed.

“We have seen that when the government makes sudden changes without consulting the industry, it does not produce good results,” Mauroof said.

He added that when the previous requirement for compulsory dollar minting was introduced, industry experts had warned that the issue would not be resolved, and despite resorts complying with the law, the dollar shortage persisted.

Mauroof said the public should be concerned about the risks associated with increasing the resort dollar-deposit requirement to 40 percent. He warned that the tourism industry could face a more dangerous situation than the current one if the change is implemented without proper study.

“I don’t believe that raising the marking dollar to 40 percent can solve this problem, and the potential loss to the industry is a huge risk,” he said.

On Monday, MMA Governor Ahmed Munawar announced that the government will propose amendments to the Foreign Exchange Act requiring resorts to deposit 40 percent of their dollar revenue into Maldivian banks. The amendment also includes changing the deposit cycle from once every three months to once every month.

The Maldives Association of Tourism Industry (MATI) has also expressed concern over the proposed change, stating that the requirement for resorts to deposit 40 percent of their dollar earnings would have significant implications for the sector.