Maldives’ Outlook Downgraded Despite Tourism Recovery
Skift Take
- Fitch Ratings revised the Maldives’ outlook to Negative from Stable while affirming its Long Term Currency Issuer Default Rating at B-.
- Hilton announced plans to expand the presence of Conrad Hotels & Resorts through Conrad Singapore Orchard.
- Singapore’s Far East Organization is planning to develop a new hotel in Sydney’s Rocks district, with a proposal to redevelop the Clocktower Square with a luxury new property.
Fitch Ratings revised the Maldives’ outlook to Negative from Stable while affirming its Long Term Currency Issuer Default Rating at B-. The outlook revision reflects Fitch’s assessment that tightening global financial conditions are intensifying the Maldives’ external liquidity strains, even though tourism has recovered to pre-pandemic levels. Fitch believes a sharp decline in foreign-exchange buffers, if sustained, could complicate the government’s external debt-servicing and maintenance of the currency peg to the US dollar. The ratings agency also balanced the Maldives’ strong GDP growth and some favorable structural indicators, such as per-capita GDP, relative to B peers, against a high government debt burden and its vulnerability to shocks that could undermine prospects for tourism. The main reason for the lower outlook is gross foreign reserves fell from US$1,017 million a year ago to US$540 million in September 2022. Fitch expects reserve bu
