How corruption, tourism, environmental sustainability play out in paradise

An aerial view of Malé, Maldives’ capital. Photo by: Asian Development Bank / CC BY-NC

MUMBAI, India — From an airplane, the occasional sightings of machines dumping sand on coral reefs have marred the bird’s eye view of the Maldives’ opalescent blue waters and patches of land scattered in between.

Large-scale land reclamation projects, when machines suck up sand from the bottom of a lagoon to expand the size of an existing island, have become increasingly common, and during former President Abdulla Yameen’s administration between 2013-2018, artificial islands were developed from scratch in shallow lagoons.

Now, in addition to the existing 144 three to five-star resorts in various parts of the archipelago, another 132 tourism projects are being constructed on both uninhabited and artificial islands.

Tourism is an important industry in the Maldives, accounting for over 32.5% of gross domestic product and generating $2.7 billion in revenue in 2017. While the island nation continues to sell itself as an environmental holiday destination — with several resorts usingsolar energy, recycling waste and sewage, and actively involved in coral gardening and conservation efforts — that is far from the full picture of tourism.

Marine biologists fear that this recent surge in manmade assaults could eventually choke the archipelago’s coral reefs. According to Gabriel Grimsditch, a coastal and marine ecosystems expert at the United Nations Environment Programme, the expansion of construction work in uninhabited islands and lagoons is a frightening prospect.

“This will lead to an increased amount of sediments and nutrients in the ocean. Such a high number of resorts will put an immense amount of pressure on the coral reefs and irreversibly damage them,” said Grimsditch, who has extensively studied the coral reefs in the Maldives.

Shaha Hashim, field project manager at Blue Marine Foundation, an NGO that focuses on marine conservation, says the government has plans to attract 2.5 million tourists by 2023, which she explains is “very concerning,” as it was already hard to manage limited resources and cater to over 1.7 million tourists who visited the Maldives in 2019 alone.

“Tourism is our golden egg-laying goose, but it also has very devastating impacts on coral reefs, both during the construction and operation phases of resorts,” Hashim said.

Unsustainable development and corruption

When he took office, Yameen’s administration moved away from the goal of becoming carbon neutral set by his predecessor, Mohamed Nasheed, and toward development as the only way forward — the income generated from tourism far outweighing potential environmental risks.

According to Thoriq Ibrahim, former minister of environment and energy, who worked under Yameen, this was necessary. “As a tiny island nation, if we have to grow economically, land reclamation projects have to be carried out,” Ibrahim said.“After all, Maldives is only one percent of the land, and the other 99% is the Indian Ocean.”

But not everyone is happy with such ambitious resort tourism development projects, and the destruction has causedpublic outrage throughout the Maldives archipelago.

“We’re helplessly witnessing lagoons being turned into artificial islands, one after the other. This is changing marine habitats and the dynamics of islands,” said Hussain Rasheed, a local environmentalist.

The administration amended its constitution in 2015 toallow foreign investors — including a host of high-end developers from the United Arab Emirates, Saudi Arabia, Singapore, Thailand, Europe, and the United States of America — to own freehold land in exchange for a minimum investment of $1 billion.

This continued and in 2018,33 lagoons close to Malé — the congested capital city near to the country’s international airport — were reported to be under reclamation for building luxury resorts. The total number of lagoons in other parts of the Maldives that have been sold to investors remains unknown.

“Due to a lot of loopholes in the existing regulations and a weak governance system, investors were able to grab more land and even reef areas … when the tourism industry started expanding in the Maldives,” Blue Marine Foundation’s Hashim said.

In September 2017, these concerns were brought to light when it wasrevealed that Vice President Ahmed Adeeb had laundered $90 million after he had indiscriminately leased several uninhabited islands to foreign investors. Yameen was linked to this corruption scandal and arrested in mid-February 2019 for receiving around $1.5 million in illegal payments.

Inadequacies of assessments

Another concern is the historic lack of independent scientific assessments detailing the impacts of these resorts’ development projects on the environment.

In 2015, a ruling mandated that the environmental impact assessment of proposed resort development projects — previously under the purview of the Environmental Protection Agency — should be submitted directly to the Ministry of Tourism for approval. Once the ministry took over, the reports were no longer uploaded on EPA’s website for the public to review.

“Tourism is our golden egg-laying goose, but it also has very devastating impacts on coral reefs, both during the construction and operation phases of resorts.”

— Shaha Hashim, field project manager, Blue Marine Foundation

EPA alleged that the lack of transparency was because the Ministry of Tourism would likely greenlight any resort development project to generate more revenue — even at the cost of losing coral reefs.

According to Shahida Zubair — a researcher and sustainable development expert who has studied the inadequacies of EIAs — private environmental consultants, handpicked by the resort developers themselves, create the EIAs designed to give a detailed analysis of any potential risks involved in the construction work.

The consultants, ranging from engineers and marine biologists to sustainable development experts, are also responsible for providing adequate mitigation measures to protect the coral reefs and other marine life to date.

In a 2009 study, Zubair evaluated 54 environmental impact assessments of resort development projects and found that the reports were littered with plagiarism — a sign that she suggests means they may not be a true assessment, simply words lifted from one memo to the next. The study further highlighted that non-specific or vague analysis was applied to major environmental impacts.

More than a decade later, she said that she is still not convinced that some of the hired consultants are qualified to write environmental impact assessments.

“There needs [to] be a strict selection criterion in place before someone is hired as an environmental consultant. This is still not happening in the Maldives,” Zubair explained.

Improving transparency and accountability

When the current government took office in 2018, it stated it would make luxury resort owners accountable by incorporating transparency in the process of approving a resort development proposal — a win-win situation, both politically and environmentally.

It announced that the EIA reports of resort development projects would once again be reviewed by EPA, and made the reports public on their website.

Now, EPA and the tourism ministry are working together, following an increase in concerns raised about how fast islands have been eroding, according to Ibrahim Naeem, director general of the Maldives EPA.

“Ever since we were put back in charge, we have been getting many complaints from concerned citizens. The most significant impact we noticed is damage to the coral reefs during reclamation work for resorts that have over-the-water villas and harbors,” Naeem said.

Naeem added that the agency plans on doing a thorough job in reviewing every EIA for resort development projects specifically.

Corruption scandals, however, continue to plague the island nation. In July 2020, state prosecutors raised charges against Ahmed Solih, minister of state for tourism, over allegations of abuse of power regarding the contract leasing of an island and lagoons.

An effort to halt unsustainable resort tourism

Last year, the Ministry of Tourism claimed to be thinking twice before subjecting any more virgin islands to extensive construction work when Ali Waheed, the former minister of tourism who was dismissed in July 2020 —reportedly over sexual assault allegations — announced that of the 115 uninhabited islands or lagoons leased to investors for resort development projects, 70 of them will be discontinued.

But, the reason for discontinuing these projects has nothing to do with protecting the coral reefs surrounding the 70 islands that protect them from rising sea levels. These islands were identified as “financially distressed” as leaseholders were facing issues in coming up with the funds required to complete the resort development work, said Mohamed Khussan, senior policy director at the Ministry of Tourism.

Khussan added that some investors had failed to pay the high costs of leasing the island and having to cough up fines for late payments, it was no longer financially viable for investors to proceed with their resort development projects.

A few months after discontinuing these failed projects in February 2020, the Ministry of Tourism started working on introducing a new, points-based system to vet potential investors and also ensure that they are committed to being environmentally sustainable, Khussan said.

When the bidding process for an uninhabited island begins, investors or developers will lose points if their resort development plan includes land reclamation work and having to buy palm trees from other islands.

“In this open bidding process, points will be rewarded for environmental sustainability,” Khussan explained. “Due to the COVID-19 pandemic, we have put everything on hold for now as the investment climate is not that good,” he added.

Khussan also said that other plans in the pipeline include trying to spread out the number of resorts to northern parts of the Maldives, even though it is a seaplane ride away from the international airport close to Malé.

That way, other parts of the archipelago might also benefit financially from luxury resort tourism, and it could lessen the burden of environmental impacts on areas close to the international airport.

With the Ministry of Tourism anxiously waiting to restart the bidding process for tiny virgin islands in the Indian Ocean, only time will tell if these new initiatives for environmental sustainability will bring about the transparency and regulations required to protect the Maldives’ fragile coral reef ecosystems.

Visit the Turning the Tide series for more coverage on climate change, resilience building, and innovative solutions in small island developing states. You can join the conversation using the hashtag #TurningtheTide.

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