One of the top big three rating agencies in the world, Fitch Ratings has assigned a B+ sovereign credit rating for the Maldives.
A sovereign credit rating is an independent assessment of the creditworthiness of a country by evaluating its economic and political state, to give potential investors an insight into the level of risk associated with investing in the country.
According to them, the ‘B+’ rating reflects the Maldives strong GDP growth, high government revenues against the government’s high debt burden and low foreign buffers. They also stated that the countries strong dependence on tourism sector for revenue hinders the growth of other sectors.
In the report that they published, they mentioned that the increase in GDP is a result of the continuous growth in tourism, the construction of new resorts, and investment in some large public-sector infrastructure and housing projects. Meanwhile due to the election of President Ibrahim Mohamed Solih in September 2018 has decreased the political tension significantly.
To conclude, they mentioned that they expect for a more strategic and transparent approach to public-sector spending in the Maldives in the future.
Finance Ministry has stated that they fully support Fitch’s decisions and will work them in the future in any way possible.