Maldives became a full member of SASEC in May 2014, together with Sri Lanka, following several years as an active observer. Bangladesh, Bhutan, India, and Nepal formed the project-based partnership in 2001.

The National Development Plan envisions Maldives as an an equitable, prosperous, inclusive, and connected island nation. The plan seeks to explore blue economy concepts, develop global value chains, and advocate gender mainstreaming by maximizing opportunities from its growing digital connectivity, improved infrastructure, and unique environmental and cultural resources.

SASEC Projects in Maldives

ADB-financed project and technical assistance have supported SASEC activities in Maldives to help advance the country's engagement in regional cooperation activities, including under the South Asian Association for Regional Cooperation (SAARC) and the Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) frameworks. Maldives has actively participated in SASEC from 2012 to 2014 as an observer, and then as a full member. An ADB-supported national single window project (worth $11.99 million) will help develop an automated system to improve ease of doing business, in line with SASEC operational priorities for trade facilitation. In 2022, APVAX supported Maldives's COVID-19 recovery through a regional cooperation project to upgrade vaccine cold-storage facilities, strengthen distribution, and digitalize vaccine information management.

Three technical assistance projects (worth $3.2 million) support Maldives in implementing its national single window environment for international trade and support preparation for energy projects.

Trade Snapshot

Direction of Intra-regional Trade

The value of Maldives' merchandise exports and imports trade with other SASEC member countries, using International Monetary Fund data from 2022, is captured in the tables below.

Maldives' 2nd largest import source worldwide is India, with imported goods valued at $242 million. Its 7th largest import source is Sri Lanka, with imported goods valued at $117 million.

The country's 7th top export destination worldwide is Sri Lanka, with exports valued at $5 million. Its 9th largest export market is India with exports valued at $3 million and its 12th largest export market is Bangladesh, with exports valued at $3 million.

Maldives Trade - Import

Source: IMF Direction of Trade Statistics, accessed May 2022

Maldives Trade - Export

Source: IMF Direction of Trade Statistics, accessed May 2022

Logistics Performance Index (LPI)

Maldives' overall rank rose 14 notches to 86th place out of 168 economies in 2018, from a ranking of 104 in 2016. Its 2018 overall LPI score is 2.67, up by more than a point from its 2016 score of 2.51. Its 2018 score owes itself to improvements in customs, infrastructure, international shipments, tracking and tracing, and timeliness, offsetting a dip in its logistics competence score and placing the country on top of the South Asia regional average of 2.51.

Maldives LPI 2018

Source: World Bank LPI (accessed December 2018)

Note: The LPI overall score reflects perceptions of a country's logistics based on six core dimensions: (i) efficiency of customs clearance process, (ii) quality of trade- and transport-related infrastructure, (iii) ease of arranging competitively priced shipments, (iv) quality of logistics services, (v) ability to track and trace consignments, and (vi) frequency with which shipments reach the consignee within the scheduled time. The scores for the six areas are averaged across all respondents and aggregated to a single score using principal components analysis. A higher score indicates better performance.

Economic Outlook

Asian Development Outlook

GDP growth in Maldives is estimated at 8.2% in fiscal year (FY) 2022 and 10.4% in FY2023 given that tourist arrivals and construction continue to pick up. Construction will slow down in 2023 as government begins implementing fiscal consolidation measures. Inflation in Maldives is projected at 3.3% in FY2022 and 2.8% in FY2023.

Source: Asian Development Outlook 2022 Supplement (ADB)
South Asia Economic Focus

Real GDP is expected to grow in Maldives by 12.4% in 2022 and 8.2% in 2023 on the recovery of tourism, and supported by the sector's anticipated increase in capacity. Downside risks will come from high external debt and fiscal and current-account deficits. Maldives is also vulnerable to the impacts of hikes in fuel prices.

Source: South Asia Economic Focus, Fall 2022 (WB)