Maldives Monetary Authority (MMA) has revealed that Maldives racked up a deficit of MVR 15 billion in 2020. Expenditure stood at MVR 30.6 billion, which is twice the amount of income which was MVR 14 billion.
Ministry of Finance had initially projected that, in the worst-case scenario, the nation’s economy will contract to a negative 29 per cent due to the COVID-19 pandemic.
As travel restrictions in 2020 cut off the main source of income for the Maldives, a holiday destination heavily reliant on tourism, the country’s GDP declined by a staggering 51.6 per cent in the second quarter of last year.
Throughout 2020, the country’s productivity fell from MVR 86 billion to MVR 57 billion, with the tourism sector’s growth contracting by 78 per cent. Apart from tourism, the construction, business and communications sectors also greatly suffered the consequences of COVID-19.
In early 2020, the World Bank estimated that Maldives will be the economically worst-hit country due to COVID-19 in South East Asia.
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