New legislation aimed at turning Palau into a luxury destination is to be put before the new congress which came into power on Friday.
The proposed law will restrict future investment to five-star hotel chains.
The legislation is part of the president Tommy Remengesau's vision to reduce tourist numbers and increase tourist spending.
It comes after a huge influx of tourists in 2015 and 2016, thanks mostly to an increase in package tours from mainland China.
That growth however has come at a cost, with the overcrowding having some negative environmental and social impacts.
President Remengesau told Koroi Hawkins focusing on high end tourism is also aimed at limiting that impact.
The President of Palau Tommy Remengesau Jr.
Photo: RNZI / Koro Vaka'uta
Transcript
TOMMY REMENGESAU: So our vision for the next four years is really to present our region of a pristine paradise Palau. This is in line with our desire to make Palua a high-end destination. So our focus will be on quality in tourism, quality investments, as opposed to just increasing the number of tourists coming to Palau.
KOROI HAWKINS: And I note you'll be proposing legislation, will you be working on legislation this year that will make it so you only approve future development for five-star hotel development. What's the intention there?
TOMMY REMENGESAU: That's right. For major foreign investments with implications to Palau, especially in the hotel industry, we will only entertain five-star, high-end investments.
KOROI HAWKINS: And you're providing some incentives, I understand there's some conditions?
TOMMY REMENGESAU: Yes. Our definition of high-end is that they will come in with their own design and water treatment systems, power backups, water system backups. If there are any other infrastructures that they have to do, like roads, the investor would do it themselves. In return for that we will give them the necessary tax break in exchange for that.
KOROI HAWKINS: Finally, a timeline on your proposed legislation?
TOMMY REMENGESAU: The legislation was actually with this last congress but the time now doesn't look like they're going to finish the job, so we're going to pick up with the next congress. But incoming congress leadership and myself have talked about it and it will be done within the first 100 days.
KOROI HAWKINS: Assuming President Tommy Remengesau's ambitions are realised the law should be in place by the end of April.
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