- Sluggish growth in tourism sector
- Construction sector developing
- Boycott campaign impacting tourism
Maldives Monetary Authority (MMA) revises economic growth from the predicted 6.4 percent for this year. MMA's Monthly Economic Review for last month said that the economy is not expected to grow along the same lines as the forecast due to sluggish growth in tourism sector. The 6.4 percent growth rate was predicted factoring in growth in tourism and construction sectors.
MMA says based on the arrivals for the last month, it is not expected that growth rates will pick up for this year. However, the construction boom and large scale infrastructure projects is expected to propel the construction sector. Construction sector contributes to nine percent of national productivity.
Reasons for tourism sector decline
- Political chaos in the country
- Terror attacks to Europe
- Economic crisis in Russia, EU
- Tourism boycott campaign effects
Recently Tourism Minister Moosa Zameer said the Ministry was considering a revision for the target of 1.5 million tourists, given the low number of arrivals.
Economic review says June arrivals were three percent lower than the same period last year, attributed to a lowering of arrivals from China. Additionally, tourists have reduced the number of days spent in Maldives, with occupancy rates dipping to 49 percent this year from 53 percent in 2015. The average number of days spent in the Maldives is now at 5.3 days.
The official reserves are now at US$ 6.622 million. This, MMA says, is a 25 percent drop from 2015. Usable reserves are at US$ 4.2 million. Though a rise compared on a monthly basis, this is an 11 percent decrease on an annual basis. MMA attributes this to an increase in dollar sales to Banks and Government corporations.