The United States is actively engaging with the Maldives to bolster the island nation’s security and economic stability, Assistant Secretary of State for South and Central Asian Affairs Donald Lu has revealed.
In discussions that took place during the Indo-Pacific Relations panel at the United States Institute for Peace (USIP), Lu outlined a comprehensive support package that includes the provision of patrol boats, an aircraft, and potential investment agreements aimed at alleviating the Maldives’ economic challenges.
Lu highlighted the strategic importance of the Maldives, which comprises around 1,200 islands and oversees an ocean territory of approximately 53,000 square kilometers. To maintain security over such a vast area, the US has committed to gifting four patrol boats to the Maldivian coastguard and is considering the provision of an aircraft.
This initiative aims to enhance the Maldives’ maritime security capabilities without the need for foreign military personnel on its soil, addressing contentious issues related to the presence of Indian military personnel currently operating aircraft gifted by India.
On the economic front, the Maldives faces significant financial challenges, with a looming debt repayment crisis in 2026 that could exceed US$1.3 billion, an amount surpassing the nation’s annual budget. The US Development Finance Corporation is in talks with the Maldivian government to explore investment opportunities that could inject much-needed capital into the economy.
These investments, as Lu pointed out, are intended to foster private sector growth and mitigate the debt burden, ensuring the Maldives’ long-term economic sustainability.
Additionally, Lu emphasized the geopolitical dynamics at play in the Indian Ocean, urging the Maldives to balance its relations with major powers such as China and India. He expressed concern over the reliance on large loans from China for infrastructural projects, which he believes may not be economically viable in the long run.
By encouraging competition and fostering diverse international partnerships, Lu argues that the Maldives can secure more favourable terms and sustainable development outcomes.
