Maldives Loses US$1.7 Billion Annually Due to Non Performing Resort Developments

The Maldivian economy is losing an estimated US$1.7 billion (MVR 26 billion) every year due to work not being completed in 88 resort developments, according to the Ministry of Finance.

According to the “Statement of Fiscal Constraints” released by the ministry, despite the expansion and growth of tourism in the country, there are many developments that remain incomplete and under construction. The report noted that these resorts have reduced revenue projections from tourism, preventing the resorts from creating jobs and other ancillary sectors from receiving indirect benefits from tourism.

The ministry noted that the largest number of unfinished resort developments were in Kaafu Atoll where 29 resort projects are at a standstill. Kaafu Atoll is the most popular region for resort developments in the Maldives due to its close proximity with the largest international airport in the country. There are  currently 55 operational resorts in Kaafu atoll.

Meanwhile, according to the ministry, Gaafu Alifu Atoll has the second largest number of stalled resort projects where work on 10 islands remain incomplete. In Laamu Atoll seven projects remain stalled while in Baa atoll five projects remain behind schedule and out of compliance with standing agreements with the state.

There are currently 173 resorts in the country. While the previous administration had tried to provide concessions to the unbuilt resorts, the current administration has also made several attempts to mitigate delays.

The Ministry of Finance is responsible for managing the nation’s public finances and has been led by Ibrahim Ameer since the Ibrahim Mohamed Solih administration came into office on 17 November 2018.

The Ministry of Tourism is responsible for regulating, managing and monitoring tourism which is the the main revenue generating sector for the nation, and has been led, in the current Ibrahim Mohamed Solih administration, by Abdulla Mausoom since 6 August 2020. Ali Waheed had previously led the ministry under the Solih administration from 17 November 2018 to 9 July 2020.