Maldives economy expected to improve by 12 percent in 2022

The Maldives' economy is expected to increase by 12 percent next year.

While presenting the proposed budget for 2022 at the Parliament, Finance Minister Ibrahim Ameer said countries such as the Maldives, which depend on tourism for livelihood, suffered the unprecedented economic impacts of the COVID-19 pandemic to a large degree. However, the countries are on a speedy road to recovery, with their economic outlook looking brighter day by day, said the minister. Similarly, the minister said the Maldives is also recovering from the challenges caused by the pandemic at a faster pace than the rest of the world.

Citing the International Monetary Fund (IMF), Minister Ameer said the world's economy is expected to improve by 5.9 percent this year and an additional 4.9 percent in 2022. In comparison, the Maldives' economy is likely to improve by 31.6 percent this year and a further 12 percent next year, he said.

The minister further noted that the positive changes to the global economy flourish the Maldives' tourism industry. The number of daily tourist arrival almost matches the pre-COVID-19 numbers from 2019, he said. He added that the government is hopeful that the yearly tourism arrival number will cross the 2019 numbers- 1.5 million tourists- next year.

'Next year, we hope to host between 1.5 to 1.8 million tourists,' the minister said.

The transport, construction, and retail business industries, the most significant contributors to the GDP after the tourism industry, are expected to thrive next year. The minister acknowledged that the challenges to the supply chain due to the COVID-19 pandemic impacted local businesses. Projects under the Public Sector Investment Program were interrupted, and the construction industry declined both in 2020 and 2021, noted the minister.

While the travel industry has now returned to normalcy, the sector is also expected to flourish next year, said the minister. The development projects undertaken under next year's budget will also improve sectors related to the construction industry, the minister said. As a result, the tourism industry will further stabilize, which would, in turn, improve the transport, wholesale and retail sector, the minister said.