The Maldives’ official reserves have surged by 99.1 per cent since President Dr Mohamed Muizzu took office in November 2023, marking a significant recovery in the country’s foreign exchange position.

At the start of his term, official reserves stood at USD 581.2 million, while usable reserves were only USD 97.9 million, insufficient to cover even a month of essential imports such as fuel and staple goods. Throughout 2024, reserves fluctuated, dipping to USD 491 million in March and further declining to USD 371.2 million by September.

A key turning point came in October 2024 when the Maldives Monetary Authority (MMA) issued a foreign exchange regulation requiring banks to set aside a portion of income from foreign-denominated businesses. The rule, formalised under the Foreign Exchange Act in January 2025, significantly boosted dollar inflows, strengthening liquidity and the central bank’s capacity to build reserves.

The Government also secured a USD 400 million currency swap agreement with India during President Dr Muizzu’s official visit, providing a crucial buffer to stabilise foreign exchange reserves. By September 2025, official reserves had risen to USD 859.5 million, with usable reserves reaching USD 194.4 million. The MMA also held USD 116 million in investments in Maldivian banks, available for withdrawal if required.

Previously weak reserves had contributed to credit rating downgrades and raised concerns over the country’s ability to meet foreign debt obligations. Officials say the rebound in reserves reflects the Administration’s effective fiscal and monetary measures and is expected to restore confidence among lenders and investors while supporting a potential future improvement in the Maldives’ credit rating.