Keynote Address by President Mohamed Nasheed at the Asia-Pacific Business Forum

“Connecting Business in Small Island Economies to the Region.”

It is my pleasure to join you today, and to be back in Sri Lanka – home to many friends, and many memories. A little more than a decade ago, my party, the Maldivian Democratic Party, was founded in exile – here, on Sri Lankan soil. And so Sri Lanka, for me and many Maldivians, is like a home from home.
I’m also pleased to see the focus of this event is on building sustainable and more inclusive development in South Asia.

Too often sustainability is added as an afterthought, the last thing in the checklist when making policy or planning a project. This is bad for business, and bad for development. So it is always heartening to see sustainability at the top of the agenda.

Ladies and gentlemen,

For the Maldives, tourism is our main asset and resource. In a region blessed with beautiful landscapes and rich history – the Maldives is synonymous with luxury tourism and natural beauty. The Maldives experience, marketed so successfully around the world, consists of three things: sun, sand and sea.

Of course, there was always much more to the Maldives than that. Our 26 atolls – inhabited for 23 centuries – are home to distinctive architecture, language, poetry and song. But the ocean has always been our calling card. It is the backdrop to thousands of travel brochures – and honeymoon pictures.

Yet for decades our tourism business was isolated, removed from the people of the Maldives. Immediately after arriving at the airport, the tourists were whisked off to their island hideaway – in speedboats and seaplanes. When mass, long distance tourism became a reality, the Maldives figured out the formula to attract the big money.

This model worked well for some. It worked for the resort owners and tour operators. And it worked for the central government, who profited handsomely from leasing islands for resort development. But had limited impact on the average Maldivian.

The growth of household incomes has not come close to the growth of luxury tourism in the Maldives. And so the real benefits of our incredible brand are rarely felt below the beach line of the latest luxury resort.

The resort Maldives story, does however, demonstrate that a small island can be an economically viable unit. Maldivian resort islands are able to provide safe water, proper sewerage and waste management. They are able to maintain a beautiful beach and a healthy coral reef.

And resorts are able to provide all these services and facilities uses the same resources that are available in every inhabited island in the Maldives: the sun, the sand, and the sea.

The lesson here is that development does not need to be far removed from local communities. If our resorts can provide all the basic services necessary for a small community to thrive, there is no reason why we cannot provide a similar level of services in inhabited islands. The millionaire’s dream, and the Maldivian’s reality can co-exist and create a sustainable development model.

In order to bring development and prosperity to island communities, during my administration, we liberalised our policy on local tourism. We introduced a guesthouse program, which allowed ordinary Maldivians to host the more curious – or cost-conscious – travelers. For the first time, we opened up the ‘other Maldives’.

The result was better than we ever expected. Guesthouses has sprung up in local, inhabited islands all over the country. This policy has made tourism more democratic – and allowed, for the first time, ordinary people to really take advantage of it.Take Maafushi, for example – a small island that was badly damaged by the Indian ocean tsunami. In 2010, the island had just one guesthouse. Today, they have 30. Maafushi, home to just 2,000 people, welcomed over 800 tourists last year, each bringing new business to the island. Maafushi is now a vibrant island,with full employment and a diverse stream of incomes. For the first time since anyone can remember, young people from Maafushi are now moving from the capital city, Male’, and returning to their island to live and work. Water and sewerage services are financially viable in Maafushi. They now have adequate demand for provision of a modern health service. They have adequate need and desire for a good school. Sales at their corner shop have tripled since the boom of boutique tourism in the island. However, Maafushi island must manage their waste and rehabilitate their house reef to sustain this growth.

It is nothing like the model that went before. Growth in Maafushi has spurred new restaurants, recreational facilities, transport, and tourist services.
All this came from a single stroke of a regulator’s pen. It is difficult to think of a better example of how sustainable and inclusive approach can drive business and human development.

Our challenge is to replicate that success – not just in Maafushi, not just with tourism, but in the wider economy.

But we do have hundreds of islands like Maafushi, and each can prosper.

We must create lasting businesses in more of our islands. This will unlock the next stage in our national development, as investments will be much closer to the people. There will be no return to the days when economic activity happened beyond the reach of ordinary Maldivians. This new development can be inclusive by default. But there is more to be done to make it sustainable.

One of the key challenges in island nations is poor accessibility. Providing reliable, affordable and safe transport gives people and businesses the freedom to move. Just as the railways came to symbolise Britain’s industrial revolution, and the highways America’s economic development, so living waterways can lay the foundation for lasting success by connecting our people and our businesses.

Another challenge is waste management, which plagues many island communities. The waste problem has dogged us for many years, partly because we see waste as a problem rather than an opportunity. Most of the rubbish in small islands is recyclable and can be used to produce energy. So we should see this as a way to create and support innovative new businesses. This is the approach that Germany took and today they have one of the world’s highest recycling rates, and a thriving waste management industry.

But the ultimate guarantor of success – the thing we must do to build truly sustainable economies – is respond to climate change. Often, climate change adaptation is the single biggest budget item in small island states. And on current projections that is not expected to get any smaller. So we should support ambitious action internationally, but we can also pursue cleaner development at home.

This brings me to our next challenge. Energy. Production of energy in small units is expensive. But that is true only if we use the combustion engine.

The fossil fuel industry, or the internal combustion engine, is obsolete. It’s Victorian technology, it’s not fit and it’s not efficient for the 21st century. It is big, loud and bulky. And fossil fuels cost a small fortune to ship to far flung communities. So it doesn’t really quite fit in to the island economy.

What is possible is going carbon neutral. The sun is not just for the tourists to enjoy. It is also our biggest energy resource. This is why more and more islands in the Maldives are installing solar power to meet their energy needs. In other countries, island communities are also using other forms of renewable technologies. Ocean Thermal Energy Conversion Technology is successfully used in the Bahamas, Martiall Islands. Meanwhile the Reunion is using deep sea cooling technology. The ocean that surrounds our islands and the sun that shines on us is the future of our survival.

By exploring new policy options – and dealing with key issues such as accessibility, waste or energy – we can build stronger, more sustainable, more inclusive economies. And by doing that, we can create better economic connections between our many islands and the world.

Thank you very much.