The International Monetary Fund (IMF) has highlighted the tourism sector as a major factor supporting economic activity in the Maldives, helping maintain growth despite ongoing financial pressures and global uncertainties.

Following an Article IV Mission visit conducted from 4 to 14 June, the IMF stated that tourism continues to play a crucial role in generating foreign currency and supporting the wider economy.

However, the organization noted that external challenges, including the impact of conflicts in the Middle East, continue to affect economic conditions.

The IMF reported that the Maldives has shown greater resilience over the past year while facing difficult macroeconomic and financial conditions.

The institution also recognized government efforts to strengthen public finances through increased revenue collection and tighter expenditure management.

According to the IMF assessment, economic growth is expected to slow to around 1 percent in 2026 due to weaker tourism performance and higher energy costs.

A gradual recovery is projected in 2027, with growth expected to improve to around 4 percent.

The IMF warned that economic risks remain elevated, with concerns surrounding debt levels and a widening current account deficit.

The organization also stressed the importance of long-term reforms to improve productivity, strengthen human capital, and increase resilience against climate-related challenges.

The institution recommended continued efforts to maintain financial stability while ensuring that vulnerable groups are protected during fiscal reforms.

It also highlighted the importance of climate-focused planning and investment management to help the Maldives access further climate financing opportunities.

The IMF noted that strengthening economic foundations and addressing structural challenges will be essential for sustainable growth in the years ahead.