Maldives: 2021 Article IV Consultation — Press Release; Staff Report; and Statement by the Executive Director for Maldives
IMF Staff Country Reports, November 11, 2023
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- Maldives: 2021 Article IV Consultation — Press Release; Staff Report; and Statement by the Executive Director for Maldives
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Bibliographic details
- Published: November 11, 2023
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9798400258442.002
Summary of recent macroeconomic developments and outlook
- The Maldives is recovering after the historical 2020 fall in tourism, aided by a rapid coronavirus disease 2019-vaccination program rollout.
- The strong (but still partial) recovery in tourism since 2020Q4 has improved the outlook.
- Fiscal and external positions are projected to remain weak over the medium term, underpinned by current capital expenditure plans.
Risks and vulnerabilities
- A more prolonged pandemic and ambitious infrastructure projects are further weakening large pre-pandemic fiscal and external vulnerabilities.
- The Maldives has both a high risk of external debt distress and high overall risk of debt distress.
Policy analysis and recommendations
- The IMF team agreed that a tighter monetary policy stance might be needed to:
- ensure compatibility with the exchange rate peg,
- lower external imbalances, and
- build-up reserves.
- The team supported the Maldives Monetary Authority’s ongoing efforts to modernize monetary policy and the foreign exchange operations framework, including efforts aimed at eliminating exchange rate restrictions and multiple currency practices.
- The prompt and comprehensive policy approach in early 2020 was effective, but continued vigilance and policy adjustment are necessary given evolving pandemic dynamics and large capital spending plans.
Publication metadata (from content)
- Pages: 108
- Volume: 2023
- Issue: 365
- Series: Country Report No. 2023/365
- DOI: https://doi.org/10.5089/9798400258442.002
- Stock No: 1MDVEA2023001
- ISBN: 9798400258442
- ISSN: 1934-7685
International Monetary Fund. Maldives: 2021 Article IV Consultation—Press Release; Staff Report; and Statement by the Executive Director for Maldives.
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- 1mdvea2023001