The ruling Maldivian Democratic Party (MDP) dominates the People's Majlis (parliament) with 65 of the 87 seats, and this has enabled the president, Ibrahim Mohamed Solih, to pass the bulk of his government's agenda through parliament. Although The Economist Intelligence Unit continues to expect the MDP to serve out the remainder of its term, which expires in 2024, there is a low risk that it will be ousted prematurely.

In early July Mohamed Nasheed-a former president (2008-12), the leader of the MDP and the current parliamentary speaker-announced a break in his political ties with Mr Solih. Although the two are thought to have a good personal relationship, they have often fallen out in the past over matters of governance. Mr Nasheed has cited differing views over issues of complacency and corruption for his decision. However, it is possible that mounting rumours concerning the selection of Mr Solih as the MDP's candidate for the upcoming presidential elections in 2023 may also have motivated Mr Nasheed to act. We had anticipated that Mr Nasheed would act to consolidate his position in parliament, but believed that this would happen after the urgency of the coronavirus crisis had abated.

Mr Nasheed's declaration is tantamount to an effective, if not official, split in the MDP, with Mr Solih currently commanding majority support in the party. However, the faction led by Mr Nasheed could secure the support of all opposition parties and independent members, giving him a large enough parliamentary majority to block government bills and resolutions.

The risk of political instability in the Maldives comes alongside heightened security concerns. In early May Mr Nasheed survived an assassination attempt, which was widely suspected to have been made by local Islamic terrorists. He may have been targeted for his criticism of fundamentalism, which has put him at odds with certain extremist groups active in the country that share conservative religious views. The country's security forces, namely the Maldivian National Defence Force and the Maldivian Police Service, are highly politicised, and therefore any perception of administrative confusion or political instability could render them paralysed in the face of a security threat to officials, locals and foreign tourists. This could negatively affect the tourism industry, although we do not currently expect the impact to be significant.