All-Inclusive Resorts and Local Community Relations: How Development Affects Indigenous Livelihoods and Culture

In October 2024, the Fijian government tabled the Tourism Development (Amendment) Bill 2024, a piece of legislation that, among other things, mandates that all new large-scale tourism projects—including all-inclusive resorts—must submit a Social Impact Assessment (SIA) alongside the standard Environmental Impact Assessment. This is not an isolated gesture. Across the Indian Ocean and Southeast Asia, from the Maldives’ tightening of leasehold regulations for foreign-owned resorts to Thailand’s proposed “Community-Based Tourism” tax credits, a regulatory pivot is underway. The era of the all-inclusive resort as a self-contained, walled-off enclave—where guests never leave the property and local communities are reduced to a source of low-wage labour—is facing its most significant structural challenge in decades. For Hong Kong travellers who have spent a long weekend at Club Med Bintan or a honeymoon at a Soneva property, the question is no longer just about the quality of the snorkelling. It is about whether that infinity pool was built on land that was once a fishing ground, and whether the staff smiling at breakfast can afford to live within an hour of the resort they work at. This article examines the deepening friction between all-inclusive development and indigenous livelihoods, and what it means for how we choose to spend our next holiday.

The Economic Enclave: Leakage and the Local Multiplier

The core economic argument against the large-scale all-inclusive model has long been the concept of “leakage”—the proportion of tourist expenditure that leaves the local economy to pay for imported goods, foreign repatriated profits, and international supply chains. A 2018 study by the Caribbean Regional Tourism Organisation (cited in a 2022 UNWTO report on sustainable tourism) found that in some all-inclusive-heavy destinations, leakage rates can reach 80%. For every HKD 100 a guest spends on a package, only HKD 20 remains in the local economy. The rest flows back to the international parent company, the European food distributor, or the overseas marketing agency.

The Food Supply Chain Problem

Walk into the kitchen of a mid-range all-inclusive in Phuket and you will likely find frozen New Zealand lamb, Australian beef, and French butter. The resort’s procurement manager, often based in a regional office in Singapore or Kuala Lumpur, has a standardised menu to maintain. Local produce—the morning’s catch from the pier at Rawai, the organic vegetables from a farm in Chalong—is inconsistent in supply and does not meet the volume requirements of a 400-room property. The result is a paradox: a resort located in one of the world’s most abundant fishing grounds serves imported salmon. The local fishing cooperative, which once supplied the area’s hotels, now sells to a smaller, independent bungalow operation or a local market. The economic multiplier—the number of times a dollar circulates within the community before leaving—collapses.

Land Tenure and the Squeeze on Indigenous Access

The second economic pressure point is land. In Bali, the rapid expansion of high-end all-inclusive resorts in the Bukit Peninsula and Canggu has driven land prices to levels that are functionally prohibitive for local families. A 2023 report from the Bali-based NGO Yayasan Wisnu documented that the average price per are (100 square metres) of agricultural land in South Bali had risen by 340% between 2015 and 2023. For a family that has farmed the same plot for generations, the offer from a developer—often a joint venture between a Jakarta-based conglomerate and a Singaporean fund—is a life-changing sum. But selling the land means severing the family’s primary asset and its connection to the subak (the traditional irrigation cooperative system recognised by UNESCO). The resort that replaces the rice paddy may employ the son as a security guard, but it pays minimum wage and offers no path to land ownership. The family’s economic survival becomes entirely dependent on the resort’s continued operation, a precarious position when a pandemic or a geopolitical shock empties the rooms.

Cultural Erosion and the Performance of Authenticity

The cultural impact is harder to quantify than the economic one, but it is arguably more corrosive. The all-inclusive model, by its nature, curates and packages local culture into digestible, sanitised performances. This is not inherently malicious—guests want to see a Balinese dance, not a traffic jam. But the line between presentation and exploitation is thin.

The “Cultural Buffer Zone”

At a large all-inclusive resort in the Maldives, the local island is often deliberately kept out of sight. The resort is on its own private island; the staff live on a separate “staff island” or are bussed in from a mainland hub like Malé or Hulhumalé. Guests never see the local mosque, the fish market, or the family compound. The only interaction with Maldivian culture is the “Bodu Beru” drumming performance on Thursday night, staged on a beach that has been raked clean of seaweed. This creates what anthropologists call a “cultural buffer zone”—a physical and social barrier that prevents genuine exchange. The local community, in turn, views the resort as an alien entity, a source of noise and light pollution that offers little reciprocal benefit. A 2022 survey by the Maldives Association of Tourism Industry (MATI) found that 62% of resort employees from local islands reported that they had never been invited to a guest event or social function at the resort where they worked.

The Commodification of Ceremony

In Fiji, the kava ceremony is a cornerstone of indigenous Fijian social life—a ritual of welcome, reconciliation, and community bonding. At an all-inclusive resort, it becomes a nightly “Fijian Night” event, where guests drink from a shared bilo (coconut cup) while a staff member in a sulu explains the tradition in a scripted five-minute monologue. The ceremony is stripped of its context. The kava is often a lower-grade, mass-produced powder rather than the freshly pounded root used in a village setting. The staff performing the ceremony may be from a different province, assigned to the role because they fit a certain “look.” The resort’s marketing materials sell “authentic Fijian hospitality,” but what the guest experiences is a commercial reproduction, designed for maximum throughput and minimal disruption to the dinner service schedule. The genuine article—a three-hour ceremony in a village chief’s home, with conversation in iTaukei and no English translation—is inaccessible to the resort guest because it does not fit the 7:30 pm to 8:15 pm entertainment slot.

The Regulatory Shift: What 2025-2026 Means for Developers

The regulatory environment is hardening. The Fijian bill mentioned in the lede is not an anomaly. Across the region, governments are beginning to see the all-inclusive resort not as a pure economic driver but as a mixed blessing that requires active management.

The Maldives’ Leasehold Reforms

In the Maldives, the government announced in early 2024 that it would no longer automatically renew 50-year resort leases on the same terms. New lease agreements now include clauses requiring a minimum percentage of locally sourced food (target: 15% by 2026, rising to 25% by 2030) and a mandatory contribution to a “Community Development Fund” equivalent to 2% of gross room revenue. The fund is administered by the island council, not the resort operator. This is a direct response to the leakage problem. For a resort like the Four Seasons Landaa Giraavaru, which has its own marine biology centre and already runs a community outreach programme, the new rules are manageable. For a smaller, investor-backed property that has done little beyond paying its lease fee, the cost is significant.

Thailand’s Community-Based Tourism Tax Credit

Thailand’s Ministry of Tourism and Sports, in its National Tourism Development Plan 2023-2027, introduced a tax incentive scheme for hotels that contract with local community enterprises for at least 20% of their guest experience offerings. This is not a mandate, but the tax credit—up to 150% of the qualifying expenditure—is generous enough to change behaviour. A resort in Krabi that previously ran its own in-house snorkelling trips now has a financial incentive to use a long-tail boat operator from the nearby Muslim fishing village. The effect is to formalise a supply chain that previously existed only informally, giving the community enterprise a predictable revenue stream and the resort a defensible sustainability claim.

What This Means for the Hong Kong Traveller

The responsibility does not fall solely on developers or governments. The Hong Kong traveller, who books a package through a local agent or directly via an OTA, has more leverage than they realise. The all-inclusive model is not going away—its convenience is too compelling for the family with young children or the couple seeking a stress-free week. But the terms of that convenience are being renegotiated.

Three Actionable Takeaways for Your Next Booking

1. Ask about the sourcing ratio before you book. Email the resort’s guest services and ask for the percentage of food and beverage supplies sourced from within a 50-kilometre radius. If they cannot provide a number or give a vague answer, treat that as a red flag. Properties like Soneva Fushi (Maldives) and Six Senses Laamu publish this data annually in their sustainability reports.

2. Book a resort that offers a genuine village visit, not a performance. Look for properties that run a “Community Visit” programme that is free for guests and led by a local guide, not a resort employee. The AYANA Estate in Bali, for example, runs a partnership with the nearby village of Jimbaran that includes a cooking class in a family home, not a staged demo on a resort deck.

3. Spend at least one meal off-property, every two days. This is the simplest way to break the enclave dynamic. Use Grab or a local taxi to find a restaurant in the nearest town. The HKD 400 you spend on dinner goes directly to a local family, not a corporate profit centre. It also gives you a data point for whether the resort’s “local” menu is actually reflective of what people eat in the neighbourhood.

The all-inclusive resort is not inherently evil. But the model, as it has been executed for the last three decades, has created structural dependencies that impoverish the very communities that make a destination worth visiting. The next time you are sitting on a sun lounger with a cocktail that tastes faintly of chlorine and imported syrup, it is worth asking: who built this chair, and can they afford to sit in it?