The Maldives Monetary Authority’s Quarterly Economic Bulletin for Q3 2024 reports a GDP growth of 6.5 per cent, driven by tourism, public administration, and transportation, while declines in the fisheries sector and rising inflation continue to pose economic challenges.

Tourism, the backbone of the Maldivian economy, remained robust, with 476,498 tourist arrivals recorded in Q3, marking a 10 per cent increase compared to the same period last year. Resort bed nights grew by 10 per cent, while guesthouse bed nights saw a sharp decline of 24 per cent, reflecting ongoing disparities within the sector. China, Russia, and the UK remained the top source markets for tourist arrivals, while arrivals from India recorded a notable decline.

The construction and real estate sectors showed resilience, driven by a 15 per cent increase in credit extended for property development projects. This growth reflects sustained investment in the sector despite a 4 per cent decline in construction-related imports.

In contrast, the fisheries sector faced significant setbacks, contracting by 44.9 per cent. Fish purchases dropped by 53 per cent, largely due to decreased earnings from skipjack tuna and yellowfin tuna exports. Additionally, average fish prices fell compared to 2023, exacerbating losses in the sector.

Inflation increased to 1.3 per cent in Q3, up from 0.3 per cent in Q2, primarily driven by higher healthcare, energy, and food prices. Food inflation was mainly attributed to rising costs of fish products and vegetables, while inflation in healthcare was driven by increased costs for outpatient care services, partially offset by a drop in medicine prices. On a positive note, prices in information and communication services continued to decline, easing some of the overall inflationary pressures.

On the fiscal front, Government revenue increased by MVR 846.5 million, driven largely by higher business and property tax collections. However, Government expenditure fell to MVR 11 billion, reflecting reduced capital expenditure.