Mohamed Muizzu is in great trouble, Maldives At High Risk Of External And Overall Debt Distress, Maldives Declares Bankruptcy

Mohamed Muizzu Is In Great Trouble

The International Monetary Fund declares Maldives are at ‘high debt’ risk amid growing reliance on China. Maldives-India relation took hit after some leaders of the country posted some negative comments on Prime Minister Narendra Modi and also also commented against Lakshadweep Island and other tourist place.

Maldives economy is in deep trouble as the country took huge amount of loan from China. The island country owes $3 Billion from Beijing. The International Monetary Fund (IMF) recently warned Maldives of being at a high risk of ‘debt distress’ amid increasing close relations with China.

Mohamed Muizzu

Ever since Mohamed Muizzu was sworn in a Maldives President in November 2023, the island nation has been very friendly towards the Dragon.  Beijing has assured more funds for Maldives. Notably, Muizzu visited China in January 2023 and thanked the Asian giant for its “selfless assistance” for development funds.

While calling Maldives for “urgent policy adjustment”, the IMF in its report said, “Without significant policy changes, the overall fiscal deficits and public debt are projected to stay elevated. The Maldives remains at high risk of external and overall debt distress.”

Maldives-India relationship

Maldives is also facing a huge financial crisis after its relations deteriorated with India. It may be noted that the Maldives President recently said his government is unable to launch any new development projects due to the poor financial situation of the country.

It may be noted that Maldives-India relations got affected after Muizzu assumed power in November 2023. It is reported that the incumbent president of the island country is inclined towards China, which is one of the major lenders to Male.

Maldives tourism sector hit badly

Maldives financial sector is totally dependent on tourism industry suffered a massive blow after minister and other leaders posted negative comments on PM Narendra Modi and said that India faces significant challenges in competing with the island country in beach tourism.

The comments against India and PM Modi did not go down well with the Indians and the government. People from all walks of society called for a boycott of Maldives. Several personalities like Virender Sehwag, Akshay Kumar and others promoted Indian tourist places, especially Lakshadweep amid the boycott call.

Amid the massive uproar, travel agencies, like EaseMyTrip suspended all Maldives flight bookings and urged Indians to visit places like Lakshadweep. Several tour and travel players announced special packages for Lakshadweep.

Maldives leaders insulted in comments against Prime Minister Narendra Modi

The row erupted after Maldives’ former minister and two other leaders made the distasteful comments against India and PM Modi after the latter visited the Lakshadweep archipelago and promoted tourism on the island by posting mesmerising pictures of the landscape.

Furthermore, Maldives President Dr Mohamed Muizzu has been at the forefront demanding the withdrawal of Indian troops from the Maldives. Around 70 Indian troops and a Dornier 228 maritime patrol aircraft and two HAL Dhruv helicopters are stationed in the Maldives.

China ranks first on Maldives tourism list

China overtook Russia and Italy to grab the first spot on the Maldives tourism chart in February 2024. China crawled up from the third position to the first on the list of “Top 10 Markets 2024”, as per a daily report released by the Maldives’ Ministry of Tourism.

On February 3, a report showed that China topped the chart with 11.2 percent market share. The ministry’s latest report released on Monday showed data as of February 11. As per the report, China remains at the first spot but its market share dropped marginally at 10.8 percent.

China has once again become the largest source of tourists in the Maldives. Last February, the visa waiver agreement between China and the Maldives came into effect. On Sunday, the Maldives welcomed a record high of 10,213 tourists, surpassing the number of 9,000 in 2019.”

However, according to the Maldives’ ministry data, it was on Saturday, February 10 that the Maldives saw the arrival of 10,213 tourists in a day. This was the highest tourist arrivals in the island nation so far this year.

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