Update Country Report Maldives 09 Jul 2019

Event

The Maldivian president, Ibrahim Mohamed Solih, made a state visit to Singapore in early July at the invitation of the president of Singapore, Halimah Yacob.

Analysis

During his visit, Mr Solih held meetings with Ms Yacob and the prime minister, Lee Hsien Loong. A memorandum of understanding aimed at strengthening bilateral co-operation between the two countries was signed, along with another agreement to expand air connectivity. The Open Skies Agreement will help to boost bilateral trade and tourism. The terms of the agreement go beyond the current provision of services of the respective carriers to operate passenger flights to the two countries-both will be allowed to operate passenger flights and cargo services beyond both countries.

At present the two countries have uneven commercial ties, with the value of bilateral goods trade almost negligible, according to the IMF. However, their bilateral services trade has been buoyant since Singapore Airlines first began to operate flights to and from the Maldives in 1984. The tourism sector in the Maldives is likely to be the main beneficiary of the recent agreement. There is also scope for the Maldives to engage more closely with Singapore in knowledge- and capacity-building. Maldivian public officials have in the past participated in training and courses organised by the Singaporean government for foreign officials. Overall, bilateral co-operation in areas of security, transport and skills development will continue to strengthen in the coming months.

Impact on the forecast

We maintain our view that the Maldives and Singapore will share close diplomatic relations, which will be enhanced further by the recently signed agreements.