Overview

  • Maldives has a population of around 400,000 people dispersed across 188 islands. The country has been a development success; enjoying robust growth coupled with considerable development of the country’s infrastructure and connectivity. It has also provided high quality and affordable public services for its people, resulting in impressive health and education indicators with a literacy rate approaching 100%, and life expectancy of over 77 years. The country’s GDP per capita reached $10,675 in 2017, compared to $200 in 1978. It continues to grow at a rate of 7.1 percent bolstered by construction, tourism, communications, transport, and fisheries.

    Maldives’ current development challenges stem from risks from climate change, disaster resilience and environmental sustainability with rising levels of solid waste. Almost half of all settlements and over two thirds of critical infrastructure are located within 100 meters of the shoreline and are under immediate threat from rising sea levels.

    The additional challenge of the country’s geography leads to a dispersed population across many small islands, which makes service delivery difficult and can limit opportunities for job creation and economic diversification. Compounded with inclusion issues, this has caused relatively elevated levels of youth unemployment at 25.3 percent, with even much higher level in Malé, and low rates of women participating in the workforce. The combination of high unemployment and limited job opportunities for youths have made some of them vulnerable to negative social influences such as drug abuse and gang-related activities.

    To respond to these challenges, the government initiated the Greater Malé development strategy, involving investments in larger islands for improved basic service delivery, protection of households from the impact of climate change and natural disasters, and creation of economic opportunities.

    The implementation of this strategy has propelled construction as the major driver for economic growth but is costly and has led to an increase in debt and weakened fiscal position, which the Government is addressing. Construction will continue to drive near-term growth, while tourism remains the single largest contributor to the Maldivian economy.

    Following his recent victory in the 2018 presidential elections, the president-elect has pledged to restore democratic institutions and the freedom of the press, re-establish the justice system, and protect fundamental human rights. Also high on the new government’s agenda is climate change.

    Last Updated: Dec 21, 2018

  • Maldives became a member of the World Bank in 1978 and has enjoyed a trusted partnership with the institution over the past 40 years. Working together, the country has implemented 29 projects with over $255 million in support across many development areas.

    The World Bank Group’s Country Partnership Framework (FY2016-2019), endorsed by the Maldives and the World Bank board in May 2016, aims to support Maldives to achieve more inclusive and sustainable growth, making better use of the country’s assets – human capital, natural assets, and financial resources. Updated in 2018 based on an evolving country context and lessons from project implementation, the strategy was extended until 2020 and has three major focus areas:

    1. Promoting economic opportunities for Maldivians through improving access and quality of primary and secondary education, expanding the economic benefits from the fishing industry, and increasing access to financial services.
    2. Building resilience to climate change, natural hazards, and other exogenous shocks through improving environmental management, and enhancing  preparedness for disaster risk management and climate change.
    3. Strengthening fiscal sustainability through improving efficiency in public financial management.

    Currently 4 projects worth $82 million are being implemented to realize these goals with 4 projects under preparation. The active portfolio is supported by three International Development Association (IDA) investments and one guarantee; as well the Strategic Climate Trust Fund supporting the Scaling up Renewable Energy Program. The World Bank is also providing analytical support aiming at informing policy reform decisions, sector strategy development, investments, as well as supporting institutional capacity building.

    Moving forward, the World Bank Group plans to continue providing greater integrated support to strengthen Maldives’ fiscal sustainability, preparedness and resilience to natural disasters, and human capital development as the country continues to reduce poverty and increase prosperity for its people.

    IFC COLLABORATION 

    Maldives became a member of the International Finance Corporation (IFC) in 1983. Since then, IFC has invested $157 million, including $8.5 million mobilized from other institutions. IFC’s committed and outstanding investment portfolio stood at $2 million at the end of June 2017, supporting housing finance.

    In addition to housing finance, IFC has invested in several businesses, including a telecom operator, a leading hotel operator in Maldives, a finance leasing company and a Maldivian sponsor’s South-South investment in Seychelles. IFC’s advisory projects have included support for the Maldives Monetary Authority on establishing a credit bureau and drafting the Non-Banking Financial Institutions Act. IFC also has completed projects promoting green growth, such as advising on resort island energy efficiency and on solid waste management for Malé.

    Last Updated: Dec 21, 2018

  • Building capacity and improving quality of educationBank assistance focused on easing constraints to providing equitable access to all levels of education from preschool to higher secondary education. The enrollment rate at the high school level rose from 26.8 percent in 2013 to 36.8 percent in 2017. Similarly, the enrollment rate at university level education rose from 10 percent in 2005 to 21 percent in 2011 to 34 percent in 2017. In addition, a total of 55 Special Educational Needs (SEN) classrooms have been established across the country.

    Strengthening Public Financial Management: With the Bank’s support, the Ministry of Finance has made considerable progress on improving transparency through making the budget and financial information available through an integrated financial management system. In addition, the Ministry has reduced the fiscal deficit – slashing it from 10.6% of GDP in 2016 to 2.5% in 2017 – and strengthened revenue collection.

    Climate change adaptation and mitigation: Bank interventions in wetland management have successfully established two protected areas, with management units and facilities for visitors to support the conservation of fresh/brackish water wetlands with systematic planning and wide stakeholder engagement in the Southern Atolls of Gnavyani and Fuvahmulah. Subsequently, as a result of this success, the Government has recently declared 2 more Protected Areas through Gazette notifications – one each in the Shaviyani and Huvadhoo atolls.

    Additionally, the current portfolio is seeking to simultaneously enhance the conservation of fisheries and incomes of fishermen, through the Sustainable Fisheries Resources Development (SFRD) Project; increase renewable energy generation in the Maldives through the ASPIRE Project; and create a circular economy for waste reduction, reuse, and recycling by means of integrated waste management systems that meets the requirements of the population across selected zones in the country with investments in the Maldives Clean Environment Project.

    Last Updated: Dec 21, 2018

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LENDING

Maldives : Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments


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Additional Resources

Country Office Contacts

Male
Hotel Jen 4th Floor, #404 Ameer Ahmed Magu Male’ Rep. of Maldives
+960 3005289
infomaldives@worldbank.org