Despite the rebound in tourism after the Covid pandemic, the financial situation of the Maldives remains very fragile, victim of a serious shortage of foreign currencies.
The Maldives announced Friday that they had fully repaid a $500 million loan taken out in the form of a “sukuk”, or Islamic loan, thus brushing aside fears that the Indian Ocean tourist archipelago would default on its debt repayments.
A final payment of $24.68 million was made to complete the repayment of this loan taken out in 2021, said the Ministry of Finance. Despite the rebound in tourism after the Covid pandemic, the financial situation of the Maldives remains very fragile, victim of a serious shortage of foreign currencies.
In 2024, the archipelago of 380,000 inhabitants, known for its white sand beaches and luxury hotel complexes, had refused a rescue plan from the International Monetary Fund (IMF) and announced austerity measures. At the start of 2025, the IMF urged its authorities to take other budgetary consolidation measures to avoid a payment default.
“Sukuk”
“The repayment of the ‘sukuk’ was made possible by the prudent financial policy pursued by the government,” said the Finance Ministry, warning however that the growth target of 5.3% posted this year was threatened by the war in the Middle East.
“The government remains confident in its ability to ensure the supply and distribution of oil necessary to meet demand, as well as maintain public services and economic activity,” he added.
President Mohamed Muizzu has repeated in recent months that his country’s financial difficulties are “temporary”. China and India are its two main financial supporters.
