Moody’s has maintained the Maldives’ ratings at Caa2 and changed the outlook from negative to stable. The change to a stable outlook, according to a press statement from Moody’s today, reflects lower external liquidity risks, which are bolstered by reforms that boost foreign exchange profits and robust tourism industry performance. Moody’s also credited a number of government initiatives and legislative changes for this shift. They said that these elements have contributed to the creation of external buffers, such as the Sovereign Development Fund (SDF), and said that the Maldives’ history of obtaining bilateral finance further supports a reduction of external financial constraints.
Moody’s pointed out that the effectiveness of the government’s 2024 reforms is reflected in the recovery in external buffers. Increases in dollar-denominated taxes and fees, including the airport development charge and TGST, fall under this category. Additionally, they reported that the USD income was $1.2 billion, a 39% increase over the same time last year. Additionally, Moody’s mentioned the government regulation that required tourism companies to convert dollar profits to Rufiyaa in order to address the structural problems with collecting transactions related to tourism. They also said that the Maldives has been successful in securing bilateral finance, mostly from India, and that the rollovers of dollar-denominated debt, currency swaps,
Moody’s emphasized that external buffers, such as foreign exchange reserves and SDF assets, have significantly improved over the past year, reversing the decreasing trend from 2024, as further justification for shifting the outlook from negative to stable. Moody’s used the rise in foreign exchange reserves from $364 million in September 2024 to $859 million in October 2025 as proof of this. Concurrently, it was noted that the SDF’s USD cash balance had increased dramatically from $15 million the previous year to $126 million as of November 9, 2025. In light of these advancements, Moody’s concluded that the nation is in a better position to handle upcoming foreign debt because its external position has improved considerably from a year ago.
Overall, Moody’s analysis shows that trust in the Maldives’ capacity to withstand outside challenges and preserve a more stable economic foundation is improving.
