Maldives Marketing and Public Relations Corporation (MMPRC) has revealed that the company incurred significant financial losses amounting to over MVR 203 million during the final years of the previous administration, contributing to a mounting debt crisis now exceeding MVR 1.5 billion.

The statement comes in response to the 2024 audit report issued by the Auditor General's Office, which highlighted serious financial mismanagement and lack of sustainability in MMPRC’s operations in recent years. 

According to the report, the company’s debts have reached alarming levels, including liabilities to the Ministry of Tourism related to island sales and additional loans taken from public enterprises.

Breakdown of yearly losses shows that MMPRC suffered:

- 2020: MVR 1.6 million

- 2021: MVR 141.9 million

- 2022: MVR 42.2 million

- 2023: MVR 17.9 million

Total losses over the four-year period stand at MVR 203.4 million.

The Auditor General’s report also pointed to an outstanding debt of over MVR 1.5 billion owed to the Tourism Ministry, stemming from the controversial sale of uninhabited islands between 2013 and 2015. 

The report further notes an MVR 85 million loan taken in 2020 from Maldives Ports Limited (MPL), with a 4.6% annual interest rate, adding to the financial burden.

In response, MMPRC’s current management confirmed it has implemented a series of corrective measures to control spending and streamline operations. 

One of the most significant changes has been the reduction in the number of global PR agencies from 21 to just 6, resulting in annual savings of MVR 4 million. 

Recurrent expenditures have also been brought down by over 10%, the company stated.

Exhibition and trade show spending, which previously consumed up to 80% of the marketing budget has now been reduced to 34%, yielding an average saving of MVR 2 million per major event without compromising industry presence or visibility.

Despite the financial challenges, MMPRC reported improvements in tourism performance indicators. 

All of Maldives’ top ten tourist source markets are showing positive year-on-year growth, including a strong recovery from India, where tourist arrivals shifted from a 39% decline to a 4% increase.

According to the company, tourism arrivals reached 2 million in 2023, a new national record with USD 4.7 billion in tourism receipts, the highest in the country’s history. 

This year, Maldives crossed the 1 million tourist milestone earlier than ever, placing the sector on track to meet its 2025 targets.

The company emphasized the challenges it faces compared to tourism boards in neighboring countries, which are fully subsidized by their governments. 

MMPRC, in contrast, operates under limited financial support, which it claims adds pressure to maintain competitiveness in the global market.

The corporation stated that its restructuring efforts, combined with ongoing cost-saving strategies, are part of a wider move to restore financial stability. 

It added that further financial details will be disclosed during the upcoming Annual General Meeting, alongside the audited financial statements for 2024.