The Republic of Maldives in the Indian Ocean, made up of more than 1,100 coral islands, is blessed with a spectacular geography which has resulted in its evolution as a paradise for tourism. The country is at an advantage in terms of attracting visitors, including celebrities and billionaires, from all corners of the world. Since the industry’s beginning in 1972, the natural splendour of the Maldives has spurred tourism growth as the primary driver of the economy. The cross-pollinating nature of tourism and the role it plays in the economy becomes apparent when we note that this sector contributes a large percentage to many economic indicators.
The country has also evolved a rich social and business culture and continues to attract much talent as it leads the region with sustained economic growth. Despite being one of the most tourism dependent economies in the world, the archipelago has managed to swiftly shrug off recent external shocks and make great strides in its GDP growth rates in recent years.
According to the World Bank, real GDP is expected to grow by 6.5% in 2023. A total of 1,878,537 arrivals were recorded in 2023 which represents the highest number of tourist visits in the island’s history. This remarkable achievement is made despite a notable decline in arrivals from several European markets. The latter has been compensated for by a resurgent Russian market as well as from China reopening for outward travel. However, risks to global travel remain given the evolving geo-political landscape. Moreover, as the world emerges from a period of inflation, further volatility greets 2024 as conflicts and trade disruptions loom on the horizon. Hence it is more important than ever to have a deep and timely understanding of both local and global developments.
This report, which highlights three key areas; tourism, construction and real estate, has been compiled with the use of both primary and secondary research and data gathering. Our research team has also drawn on our real estate databases that date back to 2014 when our team conducted a baseline survey with boots on the ground going from building to building in order to count the stock of residential, commercial and retail real estate stock in Male and Hulhumale.
In compiling this extensive report we have examined the current and future health of the country’s economy and included a very detailed look at hospitality, construction and real estate as these three sectors are closely entwined and interdependent. They are also the primary driver of FDI into the Maldives. For example, ongoing mega-infrastructure projects like the Greater Male Connectivity project and the Velana airport expansion have a direct and tangible impact on all three sectors.
Where real estate is concerned, there have been recent concerns on the impact of recent government policies such as the Binveriya scheme as well as a sharp rise in apartment stock in Hulhumale. More specifically, investors and property owners have aired concerns on the potential impact this could have on apartment values and rental yields. Using property databases that span ten years, the report takes an insightful look at the potential impact of these developments on the current and future property market.
This latest report of the Maldives publications is aimed at quenching the thirst for reliable and timely economic analysis and market intelligence on the part of local and international business leaders, investors, resort developers and property developers. The contents will also be of value to policymakers, the corporate world, academia and generally anyone interested in learning more about the past, present and future of this fascinating economy that is unique in so many ways.
