Tuesday February 28th 2017

Economic Profile

Buy Bridesmaid dresses NZ at discount price at Topbridal.co.nzThe Maldives is an archipelago of 1,192 small coral islands. Of the 200 inhabited islands, one third have fewer than 500 inhabitants. The extremely dispersed and fragmented population of about 370,000 people (a third of which is said to live in the capital Male) makes the development problems of the Maldives unique. In addition, the survival of the country’s low-lying islands is threatened by the constant rise in sea levels due to global warming.

Buoyant average GDP growth of up to 6 – 8 per cent year over the last decade driven by investment in the tourism sector with low levels of inflation until recently has been a distinctive feature of the economy in recent years. Significant progress has also been achieved in human and social development over the past two decades.  Credible macroeconomic and public investment policies as well as a largely favourable external environment has facilitated this progress, lifting the Maldives from being one of the 20 poorest countries in the 1970s to one that shares many characteristics of a lower middle-income country today.

The small size of its economy, which is largely dependent on tourism and fisheries, makes the Maldives vulnerable to external shocks as witnessed by the economic recession following the tsunami of December 2004. In spite of the relatively low death toll after the tsunami, the country’s economy was badly shaken. Financial damage was estimated at 62% of GDP or $470 million, aggravated by a non-tsunami budget deficit of approximately $80 million in 2005 due to a significant fall in revenue from tourism.

The country lacks land based natural and mineral resources; as a result virtually all economic production is highly dependent on imports, creating a heavy dependence on foreign exchange earnings. Intensive agricultural production is limited because of the poor quality of soil (porous, deficient in nitrogen and potassium) and the limited availability of fresh water. All staple foodstuffs, basic necessities and items for the tourism industry are imported.

National Trade Policy Coordinating Committee (NTPCC)

The National Trade Policy Coordinating Committee (NTPCC) was established with the approval of the President’s Office in May 2009. The Committee, chaired by Minister of Economic Development, is composed of 15 members representing10 government trade related ministries/departments/agencies and the Maldives Chamber of Commerce. At the government level, the membership of the committee is mainly composed at the Permanent Secretary Level. Current members include;

– Minister, Ministry of Economic Development
– Deputy Minister, Ministry of Economic Development
– Permanent Secretary, Ministry of Economic Development
– Permanent Secretary, Ministry of Finance and Treasury
– Permanent Secretary, Ministry of Health and Family
– Permanent Secretary, Ministry of Tourism, Arts and Culture
– Permanent Secretary, Ministry of Human Resources, Youth and Sports
– Permanent Secretary, Ministry of Housing, Transport and Environment
– Permanent Secretary, Ministry of Fisheries and Agriculture
– Permanent Secretary, Ministry of Civil Aviation and Communication
– Permanent Secretary, Ministry of Foreign Affairs
– Senior Official from Attorney General’s Office
– Offical from Maldives Chamber of Commerce and Industries

The objectives of establishing the NTPCC include;

• Establishing regular and transparent procedures for co-ordinating economic/trade policy implementation across sectors;
• Consult and seek advice from affected stakeholders in the formulation of economic/trade related policies;
• Support development of coherent and cohesive  economic/trade policies across government and economic sectors;
• Formulate strategies and detailed policy interventions to achieve broader economic and trade policy objectives; and
• Raise awareness on economic and trade issues among the wider public and the stakeholders from various institutions.

Role and functions of NTPCC
• Co-ordinate, advice and make recommendations on economic and trade policy issues and monitor implementation of economic/trade policy interventions.

SME Development Council
Decision to establish a Small and Medium Enterprise (SME) Development Council was made by the Cabinet on 20 October 2009. The Council will be composed of 11 members with Minister of Economic Development acting as the Chairman. Other members included in the in the Council are:

1. Minister of Fisheries and Agriculture
2. Minister of Tourism, Arts and Culture
3. Minister of Human Resources, Youth and Sports
4. Minister of Finance and Treasury
5. A civil society member to represent women entrepreneurs
6. A civil society member to represent fishing industry
7. A civil society member to represent agriculture industry
8. A civil society member from tourism industry
9. A civil society member to represent information and communication industry
10. A member from an environment related civil society organisation
11. A civil society member to represent construction industry

Main roles of the SME Development Council include formulating plans to achieve the goals outlined in the government’s election manifesto regarding the development of SMEs. The Council also will ensure that the programmes planned for the growth of SMEs contribute towards achieving government’s broader economic policy objectives.

The Council’s role include establishing a standard to define small and medium enterprises, and overall coordination, monitoring and evaluation of all the programmes undertaken in the Maldives for the growth of SMEs. The Council will also advise on the establishment of an SME bank in Maldives.

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