Loss of Investor Confidence Prompts Former Tourism Adviser to Halt Further Investments in Maldives 

Mohamed Khaleel, managing director of Pulse Hotels & Resorts and CEO of Manta Air, has announced that companies he represents will not make further investments in the Maldives, citing a loss of investor confidence caused by abrupt regulatory changes.

The decision follows Khaleel’s resignation as Tourism Adviser to President Muizzu, a move directly prompted by the government’s introduction of a mandatory 40 per cent foreign exchange requirement for tourism businesses.

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The amendments to the Foreign Exchange Act was passed by Parliament last month with the support of the ruling People’s National Congress (PNC) supermajority. Under the amended law, Category A tourism establishments must convert 40 per cent of their monthly gross sales through banks. The previous option to convert USD 500 per tourist was removed.

In an interview with MIRA Business FM, Khaleel explained that he stepped down from his advisory role after concluding that his recommendations no longer carried weight in government decision-making. He described the new policy—which requires resorts to convert 40 per cent of their US dollar earnings locally—as an impractical form of capital control that fundamentally undermines the certainty investors require to repatriate profits.

Khaleel estimated that roughly 90 per cent of Maldivian resort properties will struggle to comply with the mandate. Tourism operators already carry heavy US dollar obligations, including foreign loan repayments, land rent, tourism taxes, staff remuneration, and essential imports such as fuel and food.

He noted that even the previous 20 per cent conversion threshold proved challenging for all but luxury properties commanding daily rates above USD 1,000, arguing that a 10 per cent requirement would have offered a far more realistic baseline for the sector. Furthermore, recent dollar insurance schemes have added between 1 and 1.5 per cent to existing financial service costs, further straining businesses reliant on foreign capital.

While Pulse Hotels & Resorts will continue to operate its existing Maldivian properties, the group is now actively redirecting future capital towards destinations including Oman, Dubai, Portugal, and Italy. Khaleel stressed that investors retain multiple destination choices, warning that sudden legislative shifts within 24-hour timeframes damage the country’s reputation against emerging markets such as Sri Lanka and Zanzibar.

To resolve the broader economic pressure, Khaleel urged the administration to address government expenditure rather than relying solely on local dollar conversion mandates. He called for direct dialogue between industry leaders and policymakers to protect the nation’s premium tourism brand, emphasizing that sustainable fiscal recovery depends on fiscal discipline and regulatory stability.

The statement by Khaleel came amid growing industry speculation and rumours suggesting that Manta Air is planning to halt its domestic flight operations.