Maldives

Welcome to the Maldives

In 2022 HSBC marked 20 years of operation in the Republic of the Maldives. Established in 2002 as a fully-fledged branch, and catering to a growing base of corporate banking customers, we are proud to have played a role in supporting the Maldives and its communities ever since.

After the devastating tsunami of 2004, the bank provided financing of USD30 million to rebuild harbours. We have also financed the world’s largest seaplane operation, and the world’s largest all-glass undersea restaurant.

The bank also acted as Lead Manager for the inaugural USD200 million Sovereign Sukuk for the Government of the Maldives. It helped arrange financing for clean water and sanitation to 20 islands, as well as providing a USD25 million loan to help local communities affected by the Covid-19 pandemic.

We look forward to continuing our support for local and international businesses, whose efforts and ingenuity will be indispensable to meeting the critical challenges that face the Maldives in the years ahead.

Mark Surgenor CEO HSBC Sri Lanka and Maldives

Contact: 9f, Zoneyria Building,
H. Zoneyria,
Boduthakurufaanu Magu,
Male’
20057
Republic Of Maldives

The Maldives: low-lying islands with high ambitions

• Powerhouse in the ocean

  Four decades after the first international tourist resort was established, the Maldives is on a robust growth trajectory – pandemic dip notwithstanding – and is the only country in South Asia to enjoy upper-middle income status.

• New heights

  As the world’s lowest country, the Maldives is extremely vulnerable to rising sea levels. Hulhumalé, a newly constructed artificial island northeast of the capital, Male, may show a way forward. Built by pumping sand from the seafloor onto a submerged coral platform, it could become a future refuge for islanders driven off low-lying islands.

• Plastic plague

  Some 860 metric tons of waste, most of it plastic, is generated daily on the islands – threatening the marine ecosystem. In response, the government has banned the import and production of single-use plastics, while improving waste management.

• Fish for medical kit

  Skipjack and yellowfin tuna are the Maldives’ biggest physical exports. The industry has rebounded from a slump during Covid-19, when the country donated a million cans of tuna to China, which in turn gifted Covid vaccines and personal protective equipment.

Country profile

Once among the world’s poorest countries, the Maldives has prospered as a magnet for honeymooners and pleasure-seekers. It has used the proceeds to improve quality of life for its scattered population. Today it is an outward-looking nation, rapidly building resilience against the unique challenges of its geography.

Underwater spas and restaurants. Glass-bottomed villas perched over water. Bedrooms with slides that lead directly into the Indian Ocean. The common image of the Maldives is one of luxurious leisure, based in the upmarket holiday resorts surrounded by dazzling white sands and coral lagoons.

The island chain stretches over 820km from north to south, and 130km from east to west. It incorporates around 1,200 coral islands, grouped in clusters known as atolls. Around 200 islands are inhabited, most of them sparsely. The capital, Male, is an exception, being heavily urbanised.

The setting certainly makes for idyllic visits, but for the Maldivian people it is also a perpetual challenge.

Besides the issue of transit, the low-lying nature of the islands – none rises more than 1.8 metres above sea level – makes for unique vulnerabilities.

Memories of the tsunami of 2004, which killed around 100 people on the islands and wreaked terrible damage, are still raw. And at the COP26 global climate summit in Glasgow, the Maldives Minister of Environment, Climate Change and Technology gave a stark warning: the Maldives might vanish by the end of the century if the world does not act fast and cohesively to tackle climate change.

The islands were a sultanate under the protection first of Dutch rulers and then of the British, until gaining independence in 1968. A multi-party political system has existed since the early 2000s. The president and vice-president are directly elected by universal suffrage. The legislative body, the People’s Majlis, meets at least three times a year.

5 key challenges when doing business in the Maldives²

1. 1

   Remoteness

   Though well-connected thanks to its tourist trade, the Maldives is the world’s most dispersed country, strung out across 800km of ocean and located some 600km from the Indian mainland. A widely dispersed population creates sales challenges.

2. 2

   Vulnerability

   Sea-level rise, tropical storms and flooding put the low-lying islands at perpetual risk. The tsunami of 2004 wreaked huge damage and loss of life.

3. 3

   Corruption

   The Solhi administration has pledged to bring about transparency and judicial reform, but corruption can still be encountered, according to the 2022 Index of Economic Freedom.

4. 4

   Values

   Religious conservatism can clash with progressive measures, such as gender equality efforts, while the government has not effectively confronted threats by Islamist groups targeting activists and civil society organisations.

5. 5

   Fiscal uncertainty

   The Maldives’ economy is heavily dependent on subsidy by the public sector. Commodity price inflation and the funding of major projects through external borrowing put the country’s fiscal sustainability at risk.