Aerial view of Maldives Monetary Authority (MMA) in capital Male.
The central bank, MMA, reported that the loans released for tourism investments has led to an increase of 15 percent in the amount of loans that were released by banks last year.
According to the annual report published by Maldives Monetary Authority, 38 percent of loans acquired by the private sector were solely for the development of facilities related to the tourism industry.
Credit extended to the tourism sector last year indicate an annual growth of 12 percent compared to that of the previous year.
The substantial growth in currency lending that was observed in 2017 was largely attributed to a rise in foreign currency lending for the construction of guesthouses and new resort development.
Excerpt from Maldives Monetary Authority’s Annual Report 2017. IMAGE: MMA
These numbers, coupled with the increased local currency lending for working capital, were also stated to have contributed to an overall increase in the credit extended for tourism-based investments.
In the report released by the authority, MMA further elaborated that the loans to the construction sector, which accounted for 18 percent of total private credit, also registered an annual growth of 11 percent.