The country's diplomatic relations will be guided to a large extent by its huge external financing requirements, resulting from its massive current-account shortfall. Furthermore, its strategic location in the Indian Ocean has meant that it will continue to garner a lot of interest from India and China, which are keen to expand their influence in the region.

Relations between China and the Maldives, which prospered under the administration of Mr Yameen, have soured sharply under Mr Solih. We expect that the government will look to revise the terms of many of the deals agreed with Chinese companies. It will also refuse to pass the legislation needed to implement the free-trade agreement between the Maldives and China that was signed in December 2017.

We do not believe that suggestions by Mr Nasheed (and others) that the amount of debt owed to China is much larger than the government had previously admitted are well-founded. However, the terms on which the money has been lent are not transparent. Officials may well seek to renegotiate these debt deals, but we do not believe that China will be receptive. If the government presses its case too hard, it is likely that China will take steps to limit the number of Chinese tourists visiting the country. Chinese visitors accounted for 19% of the 1.5m tourists who arrived in the Maldives in 2018.

Relations with India will warm under Mr Solih's government. India has committed to provide additional financial support, partly offsetting the much reduced role of China in financing construction in the Maldives. Nevertheless, the local government is likely to look to balance the influence of India against other regional powers, such as the US and Japan, in order to maximise its negotiating power.