Fitch maintains Maldives ratings despite political crisis

Fitch maintains Maldives ratings despite political crisis

Male, May 17 (newsin.asia): Fitch has said that its rating of the Maldives remains the same despite the political crisis that has engulfed the Indian Ocean archipelago in the past year.

Fitch noted that the rating reflects healthy GDP growth prospects, a strong revenue generation capacity through a prosperous tourism sector and favorable structural indicators to balance the current government debt and reserves position.

This is the first annual review by Fitch, since their initial rating in May of 2017. This review was completed with extensive meetings in Maldives with the Government and the private sector, the Finance Ministry said in a press release on Wednesday.

Describing the maintenance of rating as a “vindication of the administration’s economic agenda,” the Ministry noted that the over the past years the administration had delivered on the economic pledges and reaffirmed their commitment to do so.

Question of Debt Raised And Answered

The Ministry noted that agencies such as Fitch had expressed their concern over the debt in the country.

‘The government acknowledges these challenges and remains ready to tackle them. As such, economic diversification is a primary objective of the foreign investment policies and urban development policies that the administration had pursued in the past years,’ the Finance Ministry said.

Speaking to the Maldives Business Review about rising debt, Finance Minister Ahmed Munawwar said that debt is not the biggest challenge to the Maldivian economy. The money that is borrowed from abroad is used only for infrastructural development. Recurrent expenditure is met by internal recurrent income.

“Political instability is the biggest challenge to our economy. If we had political stability then we would be able to reach a higher level of development than this,” Munawwar added.