Widening deficits and limited policies could pose difficulties, says IMF
The IMF concluded its surveillance of the Maldivian economy, as it does with all member nations
Headquarters of the Maldives Monetary Authority, the state's central bank
The Maldivian economy is highly volatile, faces fiscal imbalances, and its rapid debt build up could leave the country vulnerable, the International Monetary Fund (IMF) has said.
The IMF concluded its surveillance of the Maldivian economy, as it does with all member nations, and released a standard ‘Article IV’ consultation in December.
The report’s primary basis is that the Maldivian economy has a positive outlook in the mid-term but requires review to ensure that it is less vulnerable.
The 88-page report, when summarized, advises that the Maldives review its policies, build adequate foreign reserves, and ensure fiscal balances as well as working towards lessening deficits.
The IMF said that the Maldivian economy is greatly supported by high-end tourism, which is reliant on flourishing economies in other parts of the world.
An increase in that last year and in 2017 had highly boosted the local economy, along with significant developments in the construction industry.
However, the report noted that unstable political conditions makes the Maldivian highly vulnerable for this reason.
