Maldives eyeing US$100m tourist tax for CO2 plan

Reuters, LONDON

Mon, Jul 09, 2012 - Page 14

A voluntary tax on tourists who visit the luxury resorts and white sands of the Maldives could raise up to US$100 million a year towards the country’s aim to become carbon neutral by 2020, Maldivian President Mohamed Waheed said.

The Maldives is made up of 1,192 low-lying islands in the Indian Ocean. With average ground level of 1.5m above sea level, it is also the world’s lowest country and one of the most vulnerable as climate change raises sea levels.

The Maldives is perhaps most famous for its 100 island resorts, which attract around a million visitors each year, mainly from Europe and the US.

“We have proposed the idea of a voluntary fund for air travelers coming to the Maldives. Even if each tourist contributed US$10, that’s US$10 million [a year] for us and a substantial contribution to the carbon neutral program,” Waheed said last week.

An airport construction project agreed last year would require US$27 from each visitor and Waheed does not want to further burden the tourism industry, which officially accounts for 30 percent of the Madives’ US$2.1 billion economy, but is thought to be closer to 75 to 80 percent.

“I believe most of the tourists who come to the Maldives are environmentally conscious and quite happy to make a contribution to making the Maldives carbon neutral,” Waheed said.

The Maldives is reliant on imported fuel, like diesel, to generate electricity, which is estimated to have cost its economy around US$240 million last year.

It has now embarked on a US$1.1 billion plan to generate 60 percent of its electricity from renewable sources by 2020. Around 50 percent would come from solar photovoltaic power and the remaining 10 percent from wind energy and biofuels, Waheed said.

The country is rapidly trying to introduce solar in the capital Male and three islands which make up the greater Male area, covering about a third of the population.

It has plans to install about 2 or 3 megawatts (MW) of solar in the Male area, but it would probably need 40MW to meet electricity demand.

The Maldives also needs to construct more environmentally friendly buildings and switch its fossil-fuel reliant land transportation to electric vehicles or hybrids.

“We are a little bit behind schedule [on the renewables plan], but we hope we will be able to catch up over the next five years or so,” Waheed said.

“Male is not the most ideal island location right now — it doesn’t have ‘green’ buildings, but a lot of companies are interested in developing them,” he said.

Out of 100 resorts on the islands, seven are considered to be “ecofriendly,” which means they try to minimize their carbon footprint, and one resort should get “carbon neutral” status by next year, he said.

The Maldives is also hoping to receive about US$30 million from the Climate Investment Funds, channeled by development banks to help poorer countries pilot low-carbon projects.