On June 26, 2024, Fitch Ratings downgraded the Maldives' Long-Term Foreign Currency Issuer Default Rating from 'B-' to 'CCC+'.

The downgrade stems from heightened risks associated with external financing and liquidity issues.

Fitch anticipates that the Maldivian government will adopt fiscal consolidation measures to reduce reliance on external financing over the medium term.

In response, the Ministry of Finance highlighted the government's commitment to reform, noting that the Cabinet recently endorsed a fiscal reform agenda aimed at consolidating government spending and boosting revenue to ensure fiscal and debt sustainability.

Fitch indicated that a fiscal path focused on consolidating public debt could lead to a positive revision of the ratings.

The agency also emphasized the importance of economic diversification and resilience to external shocks in achieving favorable outcomes in future rating reviews.

The Maldivian government reiterated its commitment to meeting debt obligations and expressed confidence that ongoing fiscal reforms and a robust economic outlook will positively impact future ratings.