Business
Owing to tourism, Fitch assigns Maldives B+ rating with stable outlook
Fitch Ratings has assigned the Maldives a first time Long Term Foreign and Local Currency Issuer Default Ratings (IDRs) at B+ with a stable outlook, largely owing to the country’s resilient tourism industry.
In an statement, the leading global credit rating agency said Monday that the country ceiling for the Maldives is assigned at BB- and the Short Term Foreign and Local Currency IDRs at B.
Fitch said the ratings balance the Maldives’ advanced economic development, strong GDP growth and high government revenue generated by a prosperous tourism sector against a high government debt burden and low foreign reserve buffers.
The Maldives’ success as a prime luxury tourist destination has generated relatively high GDP per capita of USD 9,145 (B category median is USD 3,362), Fitch said, adding that real GDP growth is expected to pick up to four percent in 2017 and 4.5 percent in 2018 from 3.9 percent in 2016 due to continued tourism demand and construction. It noted the development of new resorts and the large infrastructure projects initiated by the government, including capacity expansion of the main airport, the construction of a bridge linking the capital to population centres, an advanced medical centre and new housing units.
“The government’s ability and propensity to tax the luxury tourism sector has led to a revenue ratio of 34.9 percent of GDP, significantly higher than the B median of 24.7 percent. There is still potential to further increase the amount of revenue raised from tourism if needed, given the likelihood of rather inelastic demand in the luxury segment to moderate price rises. Government revenue forms an important link between tourism and other sectors of the economy,” the statement read.
However, Fitch warned that high dependence on tourism makes the economy vulnerable to sudden events that harm the perception of Maldives as a safe and reliable tourist destination, including the emergence of political instability in an already-polarised environment or security issues.
“The country’s high dependence on a single sector causes volatility in economic metrics, such as GDP growth, and makes the country vulnerable to external shocks and domestic developments that undermine the Maldives’ attractiveness as a tourist destination; for example, changes in perceptions of safety,” the statement read.
The agency also cautioned that execution of many large infrastructure projects at the same time has posed serious fiscal challenges. Foreign debt financing of the large construction projects will increase the importance of foreign-reserve buffers in the years ahead, it said.
“The risks to external balances from the low reserve base are mitigated by the persistent current account deficits being fully financed by foreign direct investment and by the tourism sector both earning and spending in US dollars. This implies that tourism-related outflows should also fall in the case of a sudden drop in tourism-related inflows,” the statement read.
“In addition, the country has managed with similarly low levels of foreign-exchange reserves for a number of years without experiencing an exchange rate shock.”
Dredging of the satellite town of Hulhumale, a major project undertaken by the government. PHOTO/ HDC
Fitch highlighted the new measures included in this year’s state budget to increase revenue and to cut expenditure to make fiscal space for the projects underway, saying that the remedial action should significantly lower the deficit to 4.3 percent of GDP in 2017 and 3.8 percent in 2018. However, it said the official target of reducing the fiscal deficit from the government’s estimate of 7.4 percent of GDP in 2016 to 0.5 percent in 2017 is highly ambitious.
“On the basis of the government’s announced measures and Fitch’s nominal GDP forecast, the agency expects general government debt/GDP to fall gradually from 72.3 percent in 2017 to 70 percent in 2020. At the same time, risks to debt sustainability remain and the stabilisation of debt, assumed by Fitch, depends on the government’s willingness and ability to follow through on its fiscal consolidation plan,” the statement read.
Fitch highlighted a few main factors that could lead to negative rating action:
- A significant rise in general government debt; for instance, caused by a failure of the government’s fiscal consolidation strategy.
- Balance of payment pressures; for instance, a fall in foreign exchange reserves or a higher than Fitch expected increase in external debt.
Fitch also highlighted a few main factors that could lead to positive rating action:
- Policy initiatives that lower general government debt to levels closer to the rating category median.
- Strengthening of external buffers through accumulation of foreign-exchange reserves.
- Diversification of the economy by developing sectors other than tourism; for example, facilitated by implementing structural reforms that enhance the business environment.
Fitch’s first ever credit rating for the Maldives is in line with a similar rating assigned by Moody’s Investors Service in September of B2 with a stable outlook. In the first ever sovereign credit rating of the Maldives, Moody’s also noted the Maldives’ healthy GDP growth prospects driven by the tourism sector, while raising concerns over relatively low institutional and fiscal strength and moderate susceptibility to event risk.
Credit ratings are used by investors as indications of the likelihood of receiving the money owed to them in accordance with the terms on which they invested.
Majority of foreign investments come into the tourism sector. Several foreign investors are developing resorts in the Maldives with many more expected to come this year as well.
With several foreign investments in tourism, Maldives has maintained its lead in performance of tourist properties amongst Indian Ocean destinations. A recent report by industry-leading global real estate services company Colliers International has shown that the Maldives has a significant lead on rival Indian Ocean destinations such as Mauritius, Seychelles and Zanzibar in almost every performance indicator, including occupancy, Average Daily Rate (ADR) and Revenue Per Available Room (RevPAR).
Hotel Asia Exhibition and International Culinary Challenge is referred to be the hospitality industry event in the Maldives. In this year’s Culinary Challenge (19 to 22 October 2025) comprising competitions over 20 categories, most will take place at the Faculty of Hospitality and Tourism Studies, Maldives National University, and some at the Synthetic Track, Hulhumalé.
A Founding Partnership that Endures
Since the very first edition in 2001, Bestbuy Maldives (BBM) has played a central role in shaping the International Culinary Challenge into the Maldives’ most prestigious culinary platform. The event has become a cornerstone for professional development, bringing together chefs from across the Maldives to compete, learn, and showcase their craft.
BBM and their associated Principals sponsor an overwhelming majority of categories. “From the beginning, our goal has been to create opportunities for Maldivian chefs to rise to global standards. This partnership has grown with the industry itself,” said A.V.S. Subrahmanyam, Chief Operating Officer of BBM.
Nurturing Local Talent
BBM’s contribution extends beyond sponsorship. The company has built a long-term system for recognizing and developing local culinary talent.
- BBM Chairman’s Trophy for the Best Maldivian Competitor.
- Most Promising Young Chef Award for emerging talent.
- Global exposure programs for Maldivian chefs through sponsored participation in international events.
- Pro-bono Masterclasses with world-renowned chefs to encourage learning and innovation.
Investing in the Future of Hospitality
Through initiatives such as Building Young Talent, BBM continues to mentor aspiring professionals and support the next generation of chefs. The company also promotes inclusivity by sponsoring opportunities for female and young chefs to gain international exposure.
BBM’s industry partnerships include its role as Title Sponsor of the Hotelier Maldives Awards, celebrating excellence across the Maldivian hospitality sector.
Proud Sponsors of Culinary Excellence
In 2025, BBM and its partner brands proudly sponsor 14 competition categories and 8 Main Awards, further strengthening their role in the development of culinary arts in the Maldives. Categories include Decorated Cake, Artistic Showpiece, Bread and Pastry Display, Three Desserts (Display), Desserts, Rice Dish, Asian Noodles, Team Challenge, Maldivian Dish, Creative Sandwich, Young Chef, Tea Challenge, tapas/finger food, and Iced Mocktail.
The Maldives National University – Faculty of Hospitality and Tourism Studies (MNU-FHTS) and Bestbuy Maldives (BBM) have officially signed a Memorandum of Understanding (MoU) to strengthen industry-academic collaboration and advance hospitality education in the Maldives.
The MoU was signed by Dr Aishath Shehenaz Adam, Vice Chancellor of MNU, and Ismail Hilmy, Chairman and Managing Director of BBM, during a ceremony attended by the university’s Chancellor Dr Mahmood Shaugee, senior management, and representatives from both organisations.
This partnership marks a significant milestone in developing a state-of-the-art Food and Beverage Practical Demonstration Kitchen at MNU-FHTS. BBM will support the upgrading of the existing Garde Manger kitchen and classrooms, contributing financially and materially to create a modern, industry-standard learning environment for future hospitality professionals.
Beyond infrastructure, the collaboration will extend to academic and training support, research and innovation in culinary arts, community engagement, and professional networking opportunities, ensuring that students gain practical, real-world experience aligned with industry expectations.
Highlighting the broader purpose of this partnership, BBM stated that, “This is a significant step in the direction of BBM’s vision involving hospitality industry outreach in the Maldives — because tomorrows start today. Initially, we will set up a world-class model kitchen that will be suitable for masterclasses and hands-on training for students; and also for product demonstrations, masterclasses, and interaction with groups of customers.”
Speaking at the ceremony, representatives from both institutions emphasised their shared vision to promote excellence in education, innovation, and human capital development in the Maldivian hospitality sector. This partnership underscores BBM’s continued commitment to supporting education and industry growth, and MNU-FHTS’s mission to bridge the gap between academia and industry — nurturing the next generation of hospitality leaders in the Maldives.
Business
SATA 2025 announces partnerships; confirms Hotelier Maldives, Maldives Insider as Media Partners
Hotelier Maldives and Maldives Insider have been confirmed as official Media Partners of the South Asian Travel Awards (SATA) 2025. The announcement was made during a signing ceremony held at Hulhulé Island Hotel, Maldives, where SATA unveiled its distinguished partners for the 9th edition of the annual awards.
Now in its ninth year, SATA has become a key platform for recognising excellence in South Asia’s tourism and hospitality sector. The partnership with Hotelier Maldives and Maldives Insider will strengthen the awards’ regional visibility and ensure extensive coverage of the event across Maldives and beyond.
This year’s awards ceremony will take place from 19th to 20th September 2025 at Cinnamon Grand Colombo, Sri Lanka, bringing together industry leaders, stakeholders, and innovators from across South Asia.
In addition to the media partnership, SATA 2025 also announced its corporate partners. Honda Marine has been named the Platinum Partner, while The Hawks, Velana International Airport, and Allied Insurance Company of the Maldives join as Gold Partners. Renaatus Realty has been confirmed as the Silver Partner, and Hulhulé Island Hotel continues as the official Hospitality Partner in the Maldives.
Speaking at the ceremony, SATA organisers noted that the strong lineup of partners reflects the growing importance of collaboration within the tourism and hospitality industry. With the support of its partners, SATA 2025 aims not only to celebrate outstanding achievements but also to foster long-term cooperation and sustainable growth in the region’s tourism sector.
The awards are endorsed by leading national tourism bodies and associations across South Asia, including the Sri Lanka Tourism Development Authority, Nepal Tourism Board, Visit Maldives Corporation Limited, and several travel and hotel associations across the region.
This year’s evaluation process was conducted by a panel of nine jury members representing different countries, including tourism leaders from India, Sri Lanka, Bangladesh, Nepal, Bhutan, Spain, and the Maldives.
Through partnerships with media outlets such as Hotelier Maldives and Maldives Insider, SATA 2025 will ensure broad engagement across key markets, strengthening its position as one of South Asia’s most prestigious hospitality and travel award platforms.
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