Moody’s Ratings has affirmed the Maldives’ long-term local and foreign currency issuer ratings at Caa2 while upgrading the national outlook from negative to stable. The agency also maintained the Caa2 rating for Maldives Sukuk Issuance Limited and adjusted its outlook to stable.
According to Moody’s, the change reflects easing external liquidity pressures, supported by stronger foreign currency inflows, policy reforms, and a robust tourism sector. The agency noted that external buffers have significantly improved over the past year. Foreign exchange reserves rose to USD 859 million in October 2025, equal to roughly three months of imports, compared to only USD 364 million in September 2024. The Sovereign Development Fund’s USD cash balance also jumped to USD 126 million, up from USD 15 million a year earlier.
Moody’s attributes much of this improvement to reforms rolled out in late 2024, including higher dollar-based taxes and fees such as the Tourism GST and Airport Development Fee. MIRA reported USD 1.2 billion in dollar revenue by October 2025, marking a 39% increase from the same period last year.
Regulatory changes now require tourism operators to convert their foreign currency earnings into rufiyaa, allowing more dollars to circulate locally. Meanwhile, tourist arrivals have grown by around 10%, and higher TGST and airport fees have further boosted inflows.
The agency also highlighted improved access to external financing.
Moody’s said these measures have helped ease financing risks amid tight global market conditions.
The Government’s medium-term budget plan, covering 2026–2028, aims to narrow the fiscal deficit and strengthen debt sustainability through regular deposits into the Sovereign Development Fund and efforts to stabilise the debt-to-GDP ratio.
Moody’s stated that while the Caa2 rating still reflects elevated risk, the Government’s reform agenda has restored positive momentum and improved overall economic resilience.