Maldives country brief

Introduction

The Republic of Maldives is an archipelago of 1,192 coral islands located in the Indian Ocean, 400km south-west of India. The islands form 26 natural atolls. Maldives has a population of approximately 418,000 living on 200 of these islands, although this figure includes a sizeable number of expatriate workers. Maldives has a relatively young population with almost 23 per cent under 15 years of age and around 4 per cent over 65 years of age. The capital of Maldives is Mal é. Islam is the state religion.

Real GDP growth in the Maldives averaged 6.4 per cent between 2013 and 2018, with GDP reaching US$5.3 billion in 2018.  As a widespread island chain, the Maldives has an Exclusive Economic Zone just over 900,000 square kilometres in size.

Political overview

Maldives was an independent Islamic sultanate from 1153 until the Dutch established a colony in the 17th century. Dutch control over the Maldives ended when the British established a protectorate in the18th century. It achieved independence in 1965, becoming a republic three years later. Maldives was a member of the Commonwealth until 2016, and is currently seeking readmission to the organisation

In 2004, Maldives started a political and constitutional reform process, following growing anti-government sentiment. The Government undertook a series of legislative and political reforms, including establishing a Special Majlis (Constitutional Assembly) and allowing opposition political parties.

Maldives has undergone dramatic political changes over the past decade. In 2008, Mohammed Nasheed became the first democratically-elected president, taking over from Maumoon Abdul Gayoom, whose autocratic rule lasted 30 years. In 2012, Nasheed resigned after weeks of opposition protests, which he described as a coup. After a turbulent period in which Nasheed’s Vice President Waheed held the Presidency, Abdulla Yameen seized power in a disputed election result with the aid of security forces. Yameen is alleged to have restricted political freedom and civil liberties and to have systematically pursued his political opponents. Nasheed was imprisoned on terrorism charges, then was subsequently released for medical treatment and fled into exile.

In September 2018, opposition leader Ibrahim Mohamed Solih won the presidential election by a decisive majority and his Maldivian Democratic Party (MDP) won Majlis elections in April 2019 by a landslide. The elections were noted by the Commonwealth Observer Group as being “peaceful and organised”. Former President Nasheed was elected as an MDP candidate and became speaker of the People’s Majlis.

Economy

Maldives has quickly become a middle income country, driven by the rapid growth of its tourism and fisheries sectors. It graduated from the UN’s Least Developed Country designation in 2011 and achieved Middle Income Status in 2013. The country has enjoyed robust economic growth coupled with considerable development of the country’s infrastructure and connectivity. It has also provided high quality and affordable public services for its people, resulting in impressive health and education indicators, with a literacy rate approaching 100 per cent and a life expectancy of over 77 years.

Tourism is Maldives’ largest economic activity and accounts for around 70 per cent of Gross Domestic Product (GDP). Tourism arrivals continue to grow, with the Maldives seeing a seven per cent increase between 2017 and 2018 arrivals.

Fishing is an important sector, being a large source of employment and a major source of food for the local market. Agriculture and manufacturing play a lesser role in the economy, constrained by the limited availability of cultivable land and the shortage of domestic labour. Most staple foods must be imported.

Real GDP growth in the Maldives averaged 6.4 per cent between 2013 and 2018, with GDP reaching US$5.3 billion in 2018. Diversifying the economy beyond tourism and fishing, reforming public finance and increasing employment opportunities remain major economic challenges for Maldives.

Maldives is the lowest-lying country in the world, with its highest natural ground height of only 2.4 metres and 80 per cent of the landmass at 1 metre or less above sea level. The Maldives is concerned about the threat posed by climate change and has been active internationally to bring attention to the issue.

Bilateral relations

Australia and the Maldives have a growing relationship, with links in trade, security and transnational crime, education and development cooperation. Bilateral relations were established in 1974. Australia and Maldives celebrated the 45th Anniversary of Diplomatic Relations in June 2019.

We continue to engage in dialogue on several shared interests, including human rights, terrorism and building democratic institutions. We remain a constructive partner, encouraging the Government of the Maldives to continue its important democratic reform agenda, including by respecting the fundamental rights and freedoms of all Maldivians, including freedom of assembly and speech.

Australia and Maldives cooperate well in multilateral and regional forums on irregular migration and climate change.

Australia–Maldives bilateral trade has remained steady over the past decade. Total bilateral trade was $160 million in 2018, of which $46 million was Australian merchandise exports. The bulk of bilateral merchandise trade is Australian food and beverage exports to the Maldivian tourism industry. Australia was Maldives' 9th largest source of imports in 2017. There were 134 Maldivian students studying in Australia in 2018. Australia’s education related travel exports to Maldives were worth $9 million in 2018.  

Development assistance

The total Australian Official Development Assistance (ODA) to Maldives in 2019-20 will be $2.6 million. The objectives of the aid program to Maldives are to improve human resources through scholarships and fellowships, to foster people-to-people links, and to strengthen governance through stronger civil society and access to justice. Our long term contribution, mainly in scholarships, is widely recognised by Maldives and other nations.

Eight long term Australia Awards were funded in 2018-19 (and will increase to 14 scholarships in 2019-20).  In selecting these scholars, priority was given to economic development, education, environmental management and good governance.  To date, 639 Maldivians have completed studies in Australia, funded by the Australian Government.  Of these, 550 were on Australia Awards, 80 on Australia Award Fellowships and nine on Endeavour Awards.   

DFAT is contributing $2.47 million over eight years (June 2013- May 2021) to the United Nations Development Program’s (UNDP) Integrated Governance Project. The project aims to strengthen transparency and accountability of public institutions, promote equitable access to justice and respect for human rights, and strengthen civil society organisations. 

DFAT contributed $2 million (June 2013 – December 2018) to the World Bank implemented Climate Change Trust Fund in Maldives. The total value of the fund was USD10.3 million with funding from Australia and EU. The project assisted more than 4,000 households through enhanced tourism, livelihood opportunities, and ecosystem conservation.

The Australian Government provided funding in 2015-17 to the Australian Maritime Safety Authority to improve maritime search capabilities in Maldives, which has a search and rescue area of close to one million km2. The $2.6 million program (also including Sri Lanka and Mauritius) focuses on training, development of operational procedures, and implementation of better systems to enable countries to communicate and coordinate more effectively with each other on search and rescue operations.

Last Updated: 14 January 2020