Real Gross Domestic Product (GDP) of the Maldives has declined to -17.7% compared to 5.9% in 2019.
According to the statistics of Maldives Monetary Authority (MMA), with the dislocation of demand and supply, global trade further declined in Q2 2020 with a downturn of -3.5 in Q1 2020. The economic activities in the Maldives had a major negative impact in Q2 2020 especially the tourism industry with pandemic-led border closures, lockdown and travel restrictions worldwide. The tourism sector directly accounts for over 25% of the Maldivian economy and 81% of export earnings which was hardest hit by COVID-19.
The tourism indicators indicate that total tourist arrivals decreased from 995,000 in January to July 2019 to 385,000 in the same period in 2020 which is a 61.3% decline which also decreased tourist bed nights by 55.6%. This is mainly impacted by the travel restrictions which decreased the number of arrival flights by 52.9% where over 80% of tourists are from Europe and Asia.
The statistics further reflect that the inflation rate has risen to from -4.5% in June to -1.1% in July having a major rise in food and beverages from 1.2% in June to 3.5% in July. In addition, inflation of fish increased from -0.3% in June to 3.5% in July along with housing, water, electricity and gas which rose by 10.1% in July 2020.
During the pandemic, the government has taken several measures for pandemic containment and economic recoveries such as expenditure on mitigation and containment of COVID-19, economic relief for individuals, households, and business enterprises. Moreover, with the opening of the border and ease of travel restrictions, the economy may recover from the economic downturn.
Full details are available at the link below
Source URL: Corporate Maldives