World Bank in their latest regional update titled “Reshaping Norms: A New Way Forward” claimed that the Maldives real GDP is expected to grow by 8.5% in 2022 and by another 9.1% in 2023.
Furthermore, the bank in its report assessed that the medium-term real GDP growth of Maldives has reached 7.6% in 2022 while it is expected to lift to 10.2% in 2023.
The island nation’s economic recovery came mainly due to the strong recovery made by the tourism industry. World Bank commented that the successful vaccination programs in the country led to Maldives observing a “robust recovery in the tourism sector” despite repeated Covid waves.
Furthermore, tourist arrivals were catching up to pre-pandemic levels in the second half of 2021, which however stayed 22% below 2019 levels by the end of the year.
However, tourism receipts had almost reached pre-pandemic levels attributed to the longer stays by tourists during the pandemic.
Meanwhile, World Bank estimates that the South Asian region’s GDP will collectively grow by 6.6% in 2022 and by 6.3% in 2023.
Moreover, the bank ascertained that the prospects of economical recovery for the Maldives were even stronger had it not been for the “abrupt decline of visitor arrivals from Russia and Ukraine” dampening the momentum.
Although the geopolitical tensions are expected to place certain dents in the economic recovery of countries everywhere including Maldives, the tourism impact may be offset by the resumption of Indian arrivals as direct flight operations resume while arrivals from China may reach to pre-Covid levels in 2023.