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In the early 1990s, Maldives was ranked
by the UN as one of the world's twenty-nine least developed
countries. The World Bank estimated Maldives' gross national
product (GNP--see Glossary) in 1991 at US$101 million and
its per capita income at US$460. The 1993 estimated real growth
rate was 6 percent. Between 1980 and 1991, GNP was estimated
to increase at an average annual rate of 10.2 percent.
President Gayoom's development philosophy centers on increasing
Maldives' self-sufficiency and improving the standard of living
of residents of the outer islands. In 1994 a considerable
gap continued to exist between the general prosperity of the
inhabitants of Male and the limited resources and comparative
isolation of those living on the outer islands. The Third
National Development Plan (1991-93) reflected these objectives
and aimed to improve overall living standards, to reduce the
imbalance in population density and socioeconomic progress
between Male and the atolls, and to achieve greater self-sufficiency
for purposes of future growth.
The fishing and tourist industries are the main contributors
to the gross domestic product (GDP--see Glossary). In 1992
the fishing industry provided approximately 15 percent of
total GDP. Revenues from tourism were comparable to 80 percent
of visible export receipts in 1992, contributing approximately
17 percent of GDP. The country had no known mineral resources,
and its cropland--small and scattered over the approximately
200 inhabited islands--was inadequate to sustain a burgeoning
population. Agriculture employed a little more than 7 percent
of the labor force in 1990 in the limited production of coconuts,
cassava, taro, corn, sweet potatoes, and fruit, and accounted
for almost 10 percent of GDP. These basic foodstuffs represented
only 10 percent of domestic food needs with the remainder
being imported.
Data as of August 1994
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Based on IMF reports, Maldives's trade
deficit increased to US$110.5 million in 1992 from US$82.6
million in 1991. The current account deficit also increased
to US$33.2 million in 1992 from US$9.0 million in 1991. Principal
food commodities imported were rice, wheat flour, and sugar.
The main imported manufactured goods were petroleum products
and various consumer goods. Imports in 1991 came primarily
from India, Sri Lanka, Singapore, and Britain in that order.
Principal exports consisted of frozen,
dried, and salted skipjack tuna; canned fish; dried sharkfins;
and fish meal. Maldives also exported apparel and clothing
accessories from its small manufacturing sector. Exports were
destined mainly to Britain, the United States, and Sri Lanka
in descending order.
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The Maldivian unit of currency is the
rufiyaa (Rf). Introduced in 1981, the rufiyaa replaced the
Maldivian rupee. The rufiyaa is divided into 100 laari. The
January 1994 dollar exchange rate was US$1 = Rf11.1 rufiyaa.
The rufiyaa has been steadily declining in value against the
dollar. The 1993 estimated inflation rate in consumer prices
was 15 percent.
Established in 1981, the Maldives Monetary Authority was
the nation's first central bank. In 1974 the first bank established
in Maldives was a branch of the State Bank of India. A branch
of the Habib Bank of Pakistan was established in 1976 and
the Bank of Ceylon also opened two branches. The first commercial
bank established in Maldives was the Bank of Maldives, Limited.
It opened in 1982 as a joint venture between the government
and the International Finance Investment and Credit Bank of
Bangladesh; by 1993 it was 100 percent state-owned.
Data as of August 1994
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In 1992 the fishing industry employed
about 22 percent of the labor force, making it the largest
single source of employment in Maldives. However, a high level
of disguised unemployment existed on a seasonal basis as a
result of climatic conditions.
Despite its importance as a source of government revenues,
tourism provides little meaningful employment opportunities
to Maldivians. Tourism accounts for only about 6 percent of
the country's labor force. Because most Maldivians have no
education beyond primary school, most lack the required knowledge
of foreign languages to cater to foreign tourists. As a result,
nonMaldivians filled most of the best jobs in the tourist
industry. Indigenous employment on the resort islands was
also discouraged by the government's efforts to limit contact
between Maldivians and Westerners to prevent adverse influence
on local Islamic mores. Also, the low season for tourists,
the time for rainy monsoons from late April to late October,
coincides with the low season for the fishing industry.
After fishing, the largest source of employment is in the
industrial sector, including mining, manufacturing, power,
and construction. Although this sector also accounted for
nearly 22 percent of the labor force in 1990, most employment
was in traditional small-scale cottage industries. Women are
mainly employed in these activities, such as coir rope making
from coconut husks, cadjan or thatch-weaving from
dried coconut palm leaves, and mat weaving from indigenous
reeds. The ancient task of cowrie-shell collecting for export
is another occupation in which only women participate. In
the early 1990s, a small number of modern industries were
operating, mostly fish canning and garment making. The largest
garment factories are Hong Kongowned and occupy abandoned
hangars and other maintenance buildings at the former British
air station on Gan. They employ about 1,500 local women who
are bused in and about 500 young Sri Lankan women who reside
at the site working nightshift.
Other forms of employment in 1990 were minor. Government
administration accounts for about 7 percent of workers; transportation
and communications, 5 percent; trade, 3 percent; and mining
of coral, 1 percent.
Data as of August 1994
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The fiscal system in Maldives has been
described as rudimentary; the country has no income tax. Tax
revenues are derived from customs duties, a tourist/airport
tax, and property taxes. Major sources of nontax revenues
are derived from the State Trading Organization, rentals of
islands to tourist resorts, and boat licensing fees.
Maldives has experienced a budget deficit since the 1980s,
when more accurate accounting data became available. Government
revenues in 1984 totaled Rf205.4 million. In 1992 government
revenues rose to Rf1.02 billion, whereas expenditures totaled
Rf1.5 billion. Of these expenditures, education received Rf223
million, atoll development projects Rf362 million, security
Rf117 million, and health Rf111 million.
Data as of August 1994
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Because of its clear waters, distinctive
corals, and sandy white beaches, Maldives has many features
to attract tourists. As a result, tourism by 1989 had become
the country's major source of foreign exchange, surpassing
fishing. In 1992 tourism income constituted 17 percent of
GDP. Furthermore, tourism is expected to increase as the government
infrastructure improvement projects in the areas of transportation,
communications, sanitation, water supply, and other support
facilities are put into place.
Since the 1970s, approximately fifty resorts, mostly consisting
of thatched bungalows, have been built on many uninhabited
islands on Male Atoll. In 1990 a dozen new resorts were under
construction on Maldives. In the following year, 196,112 tourists
visited Maldives, primarily from Germany, Italy, Britain,
and Japan in that order.
Tourist facilities have been developed
by private companies and in 1991 consisted of sixty-eight
"island resorts" with nearly 8,000 hotel beds. Tourists
are not allowed to stay on Male so as not to affect adversely
the Muslim life-style of the indigenous people. Wilingili
Island has also been off limits for tourist accommodation
since 1990 to allow for population overflow from Male to settle
there.
Data as of August 1994
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Formerly, Maldives shipped 90 percent
of its fishing catch of tuna in dried form to Sri Lanka. However,
because Sri Lanka cut back its imports of such fish, in 1979
Maldives joined with the Japanese Marubeni Corporation to
form the Maldives Nippon Corporation that canned and processed
fresh fish. Also in 1979 the Maldivian government created
the Maldives Fisheries Corporation to exploit fisheries resources
generally.
Maldives has an extensive fishing fleet
of boats built domestically of coconut wood, each of which
can carry about twelve persons. In 1991 there were 1,258 such
pole and line fishing boats and 352 trawlers. Based on a US$3.2
million loan from the International Development Association
(IDA), most of the boats have been mechanized in the course
of the 1980s. Although the addition of motors has increased
fuel costs, it has resulted in doubling the fishing catch
between 1982 and 1985. Moreover, the 1992 catch of 82,000
tons set a record-- for example, in 1987 the catch was 56,900
tons.
Progress has also been made as a result
of fisheries development projects undertaken by the World
Bank. Harbor and refrigeration facilities have been improved,
leading to a fourfold increase in earnings from canned fish
between 1983 and 1985. Further construction of fisheries refrigeration
installations and related facilities such as collector vessels
were underway in 1994, with funding both from Japan and the
World Bank.
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Ports: Male, Gan; merchant fleet of some
twelve vessels.
Airports: Two with permanent-surface runways:
Male and Gan; Air Maldives is national airline.
Telecommunications: (1994)
Minimal domestic and international facilities; 2,800 telephones;
two amplitude modulation (AM) stations, one frequency modulation
(FM) station; one television station; one Indian Ocean International
Telecommunications Satellite Corporation (Intelsat) earth
station.
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Content
(c) 2000-2007 Vermillion International
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