The Maldives Monetary Authority (MMA) has warned that the country's economic growth has slowed down.
According to the economic update released by the central bank in November 2024, the Maldives' real GDP growth stood at 4.5 percent in the second quarter of 2024, while in the first quarter, the growth rate was recorded at 7.7 percent.
MMA’s report noted that the economic slowdown was due to a decline in business in the fishing, construction, and manufacturing sectors.
The report highlights that the tourism industry contributes the most significant share to the economy, with tourist arrivals increasing by 10 percent each month up to October. This growth was attributed to an increase in tourists from European and Chinese markets.
On the other hand, the guesthouse and hotel businesses have experienced a downturn. Guesthouse bed nights decreased by six percent, and hotel bed nights declined by 14 percent. Although resort bed nights showed a gradual increase, the number of operational beds so far this year has decreased compared to the same period in 2023.
The report noted that government revenue has increased by 20 percent. This is mainly due to an increase in tax revenue. Revenue from non-tax sources has decreased.
Compared to the same period last year, government expenditure has increased by three percent, with the central bank noting that recurrent expenditure has increased more than capital investments.
While government debt as a percentage of GDP decreased from 103 percent at the end of 2023 to 98 percent in the first quarter of 2024, the total debt has increased. This is due to an increase in domestic debt.
In October 2024, exports decreased by 29 percent compared to the previous year. This is mainly due to a decrease in revenue from fish and re-exports. Imports increased by two percent, primarily due to an increase in the import of transport equipment and food items.
By the end of October, foreign currency reserves reached USD 614.6 million. This is a 66 percent increase compared to September. This growth is a result of assistance received from India under a currency swap agreement with the Reserve Bank of India.
