Economic growth in the Maldives could fall below one percent this year, according to revised government projections.
Finance Ministry officials pointed to the impact of regional tensions in the Middle East on travel routes and fuel costs. Tourist arrivals have lagged behind last year’s figures despite crossing 1.5 million. The earlier target of more than two million visitors now appears unlikely.
Tourism accounts for the largest share of foreign-exchange earnings and government revenue. A slower recovery in arrivals directly affects hotel occupancy, related services, and tax collections. Construction and fisheries have provided some offset, but not enough to maintain previous growth rates.
The Maldives Monetary Authority and international institutions have also adjusted their forecasts downward. Analysts note that the country had enjoyed several years of strong post-pandemic expansion before the latest geopolitical disruptions.
The government is preparing the 2027 budget against this backdrop. Measures to support the tourism sector and diversify revenue sources are under discussion. Further data on monthly arrivals will clarify whether the slowdown persists into the peak season.
