Maldives, a dream destination for tourists across the world, has been taking steps since January 2020 to prevent any major outbreak of COVID-19 cases in the country. As of April 19, there are 52 confirmed cases, with 1,081 people quarantined and 16 recovered. Of the 52 confirmed cases in the country, 20 are Maldivian citizens (of which 15 are from capital Male alone) and the remaining 32 are foreigners. Apart from a total population of 515,696, approximately 130,000 expat labourers are working in the country. About 1.7 million tourists visited Maldives in 2019. In January 2020 alone, 173,874 tourists arrived in Maldives. With the identification of the first COVID-19 case in the country in early March, the government has pooled all the resources at its command to meet the challenge.
Given that the country has very few healthcare facilities and limited resources, the government declared a public health emergency on March 12 for a period of 30 days initially, and later extended it till April 30, 2020. The government also imposed travel restrictions on some countries including China, Iran, South Korea, Italy and France. So far, the government’s measures have been effective in containing the spread of the pandemic. However, as the country is overly dependent on tourism for its economy, the pandemic is expected to severely impact the country’s economy. While international assistance has been sought to face the challenge, emphasis is being placed on the need to reduce the country’s dependency on import of staple food items as well as on tourism as a major revenue earner.
Even before the World Health Organisation (WHO) declared COVID-19 as a health emergency of international concern on January 30, 2020, the Maldivian Government carried out an assessment in the first week of January itself to evaluate the possible risk posed by the virus. Accordingly, precautionary measures were taken to prevent the spread of the virus. Thermal screening facilities were set up at all international airports and seaports to identify passengers with possible symptoms, who would require isolation. Strict border control measures were also initiated. Initially, passengers from China were prevented from entering the country. Subsequently, a temporary ban was imposed on travellers and flights from the most affected countries in March. The issuance of on-arrival visas was temporarily suspended from March 27, except for diplomatic personnel from accredited missions, official delegations from foreign governments and international organisations.
As most of the confirmed COVID-19 cases in the country are foreigners, special preventive measures have been introduced in the resort islands. The staff members are allowed to travel out of resort islands 14 days after the departure of the last guest and with permission from the health protection authority. Travel was restricted between the resort islands and the inhabited islands. Admission of tourists to all guesthouses and city hotels across Maldives has been banned for an indefinite period, starting from March 17, 2020. All incoming people (Maldivians/expats) are being quarantined/isolated for 14 days, except tourists who have pre-booked reservation in resorts. Nine resort islands have been designated as quarantine facilities.
School, colleges, universities, offices, gyms, all cinema and film theatres have been closed down. Following the detection of the first COVID-19 case in the capital Male, without any recent travel history, on April 14, 2020, a 24-hour lockdown has been imposed in the greater Male area. As a result, the right to peaceful assembly was suspended. Congregational prayers in the mosques were also suspended and dis-infection drives were carried out in cities. The government even decided to postpone the local council elections, which were initially scheduled to be held in April 2020, to January 2021. The move, however, requires an amendment to the constitution.
Maldives has also set up a National Emergency Operations Center (NEOC) for COVID-19 preparedness and response. 46 agencies, coordinated by the National Task Force under the guidance of the Health Protection Agency (HPA) and the National Disaster Management Authority (NDMA), are working in tandem to contain the spread of the virus. On March 4, 2020, a joint drill was conducted by the Ministry of Health and NDMA to test the standard operating procedures (SOPs), which helped the authorities to manage the situation effectively when the first case of COVID-19 was detected.
In February 2020, an intensive care treatment facility was established at the Indira Gandhi Memorial (IGMH) Dharumavantha Hospital. Sea ambulance services were arranged for transferring suspected cases to isolation facilities, with the support of the Maldives National Defence Force (MNDF) and Maldives Police Services (MPS). With WHO’s support, the government is gradually enhancing its capacity to diagnose and treat COVID-19 patients within Maldives. A COVID village in Hulhumale’ to treat critical patients with provisions for a 300-bed medical facility is being prepared.
The authorities have also taken special measures to reduce the sufferings of the common people. Efforts are being made to ensure that no island goes out of food. The government has decided not to cut the salary of its officials while a subsidy of 40 per cent for electricity bills and 30 per cent for water bills (issued in April and May) have been declared for all Maldivian households.
Stimulus packages, including deferment of loan payments (up to six months), loan schemes for fishermen, farmers and small and medium enterprises have been announced. A 2.5 billion MVR worth of economic stimulus package has been declared to provide financial support for the businesses experiencing economic loss as a result of COVID-19. Funds amounting to $150 million will be obtained under the currency swap agreement signed between the Maldives Monetary Authority (MMA) and the Reserve Bank of India (RBI).
Health Care Facilities
Since the population is dispersed in different islands and the resorts islands are uninhabited, space for isolation or quarantine facilities is plentily available in the Maldives. However, facilities for test and treatment of COVID-19 patients are available only in Male, the capital city. There are a limited number of ambulances to bring patients to the capital city from different islands. As of now, the country has 97 ventilators and kits to test 9000 samples. So far, over 1500 tests have been conducted. Given the limited resources of the country, if the curve of the spread of COVID-19 is not flattened, the country is going to face severe challenge.
Impact on Economy
In January 2020, the MMA had projected a positive scenario for the economy, compared to the previous year, with estimated annual real gross domestic product (GDP) accelerating to 7.5 per cent during the current year. The estimated real GDP growth in 2019 was 5.2 per cent. Average debt in 2020 was estimated to be lower than the GDP. By January 2020, as announced by the MMA, the national reserve reached $752 million, exceeding the original estimation of $635 million. MMA attributed this increase in national reserve to surge in revenue from the tourism industry and sound economic growth. The tourism industry was estimated to grow at the rate of 9.6 per cent in 2020.
However, with the onset of the corona crisis, Maldives’ tourism industry witnessed a sharp decline in March. Compared to 2019, there was a 22.8 per cent decrease in tourist arrivals within the first 10 days of March. 161,740 bed/nights were cancelled. The tourist arrival rate is likely to drop between 12 and 35 per cent this year compared to last year, which will have a negative impact on the economy as this sector’s contribution to the GDP is very high (in 2018, it was 24.4 per cent). The total government revenue is also estimated to decrease between MVR 2.1 billion and MVR 6.9 billion in 2020, due to the decline in the flow of tourists. This will have an impact on the foreign exchange reserves and make it difficult for the government to pay for imports. Minister of Finance Ibrahim Ameer has stated that the country expects a deficit of $778.2 million.
The decline in tourism industry is going to affect the livelihood of thousands of people. Reportedly, 38 resorts have issued pay cuts to their employees and around 11,000 employees have been released under ‘no pay leave’. Though a relief package has been announced by the government for those who have lost their jobs and are severely impacted due to the preventive measures, but if the situation does not normalise soon, it may not be sufficient.
Addressing the Challenges
Maldives is seeking assistance at the bilateral and multilateral levels to procure personal protective equipment (PPE) and medical supplies, support hospitals to maintain essential services, strengthen intensive care and diagnostic facilities, and to train medical staff to manage the COVID-19 cases.
The World Bank has approved a fast-track aid package of $7.3 million to strengthen the preparedness of the country. An additional $10 million has been earmarked as contingency financing under the Disaster Risk Management Development Policy Financing with a Catastrophe Deferred Drawdown Option (CAT DDO) signed with Maldives in 2019. On March 29, 2020, the Asian Development Bank (ADB) provided $500,000 from the Asia Pacific Disaster Response Fund to help finance the government’s response to COVID-19.
The WHO continues to provide technical support in building the country’s capacity for detection, isolation, testing, treatment, critical care training for doctors, and providing COVID-19 testing kits, among others. Maldives has applied for assistance from the Asian Infrastructure Investment Bank (AIIB). It is also trying to secure $50 million from the International Finance Corporation as well as $30 million from the International Monetary Fund (IMF).
A strong supporter of the South Asian Association for Regional Cooperation (SAARC), President Ibrahim Solih has extended support to Prime Minister Narendra Modi’s initiative to formulate a comprehensive regional strategy to tackle COVID-19 under the SAARC framework. During the video conference held among the SAARC leaders on March 15, 2020, President Solih sought an economic relief package for the affected countries of the region and pledged to contribute $200,000 to the proposed SAARC Emergency Response Fund for COVID-19. He also called for the sharing of best practices among the health agencies of the SAARC countries.
At the bilateral level, India, Sri Lanka, Japan, China, the European Union (EU) and Bangladesh have extended assistance to Maldives. India has facilitated the procurement of 6.2 tonnes of medicines and also provided 5.5 tonnes of essential medicines as grant aid, apart from sending a team of medical experts. India also assisted the Maldives in evacuating its citizens from Wuhan in China. Sri Lanka is providing cargo services to the Maldives to enable the island nation to continue its trade activities. Japan has donated 10,000 surgical masks. China has committed to provide emergency medical supplies, the first shipment of which reached Maldives on March 27, 2020. The EU has decided to grant $3.28 million grant, out of which $1.10 million is extended to the health sector and $2.18 million to the tourism industry. Bangladesh has dispatched a naval ship to Maldives carrying more than 100 metric tons of food, medicine and medical equipment as corona assistance.
Increasing Self Sufficiency
Maldives is seeking to reduce its excessive dependence on tourism and imports of staple food. The government has decided to release land for agricultural purposes and has invited applications from people who wish to acquire land for cultivation. The government shareholding companies like State Trading Organisation (STO) have assured that they would provide assistance for such efforts. Recognising the need for reliable shipping lines for uninterrupted imports during crisis situations, the country has established its own shipping line, the Maldives State Shipping, in March 2020.
The Maldivian Government has been quite proactive in fighting the challenges posed by COVID-19. It has been successful to a large extent in arresting the spread of the virus. The government is also exploring ways and means of making itself more self-reliant in the long term. With help from friendly countries like India, Maldives is far well positioned to deal with the COVID-19 challenge than perhaps many other countries in the region.
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