Maldives

 

Bureau of South and Central Asian Affairs                                     
July 2007                                                                     
                                                                       
  Background Note: Maldives                                                   
                                                  
  Boat at anchor after morning fishing,                                       
  Guraidoo Island, Maldives, January                                          
  16, 2005. [© AP Images]                                                     
                                                                       
  Flag of Maldives is red with a large green rectangle in the center bearing a
  vertical white crescent; the closed side of the crescent is on the hoist side
  of the flag.                                                                
                                                                       
  PROFILE                                                                     
                                                                       
  OFFICIAL NAME:                                                              
  Republic of Maldives                                                        
                                                                       
  Geography                                                                   
  Area: 298 sq. km. (115 sq. mi.), over 1,100 islands; twice the size of      
  Washington, DC.                                                             
  Cities: Capital--Male' (pop. 70,000).                                       
  Terrain: Flat islands.                                                      
  Climate: Hot and humid.                                                     
                                                                       
  People                                                                      
  Nationality: Noun and adjective--Maldivian(s).                              
  Population (mid-year 2002): 280,000 (plus 31,000 expatriate laborers who are
  not counted in the census).                                                 
  Population growth rate: 1.66%. Population growth rate has dropped           
  dramatically in recent years.                                               
  Ethnic groups: South Indians, Sinhalese, Arabs.                             
  Religion: Sunni Islam.                                                      
  Languages: Dhivehi (official); many government officials speak English.     
  Education: Years compulsory--none. Attendance--primary (grades 1-5) 99%;    
  secondary: (grades 6-10) 51%, (grades 11-12) 5%. Literacy--98%.             
  Health: Infant mortality rate--18/1,000. Life expectancy--73 years male; 74 
  years female.                                                               
  Resident work force: Community, social and personal services--21%;          
  manufacturing--13%; fishing--11%; tourism--11%; transport, storage, and     
  communication--9%; other--35%.                                              
                                                                       
  Government                                                                  
  Type: Republic.                                                             
  Independence: July 26, 1965 (formerly a British protectorate).              
  Constitution: November 11, 1968.                                            
  Branches: Executive--president, cabinet. Legislative--unicameral Majlis     
  (parliament). Judicial--High Court, Civil Court, Criminal Court, Family and 
  Juvenile Court, and 204 general courts.                                     
  Administrative subdivisions: 19 atolls and capital city.                    
  Political parties: Adalath Party, Dhivehi Raiyyethunge Party, Islamic       
  Democratic Party, Maldivian Democratic Party.                               
  Suffrage: Universal at age 21.                                              
                                                                       
  Economy                                                                     
  GDP (2006 est): $907 million.                                               
  GDP growth rate (2006 est.): 18.5%.                                         
  Per capita GDP (2006 est): $3,000.                                          
  Inflation (2006): 2.8%.                                                     
  Percentages of GDP (2006 est): Tourism--28%; transport and communications   
  --17%; government--15%; manufacturing--7%; real estate--6%; fishing--7%;    
  construction--6%; agriculture--2%; other--12%.                              
  Trade (2006 est): Exports--$147 million: fish products. Major markets--U.S.,
  Thailand, EU, Sri Lanka, Japan (source: Maldives Customs Service). Imports  
  --$832 million: oil, construction material, prepared foodstuffs, vegetables,
  animal products, electrical appliances, wood products, computers, transport 
  equipment. Major suppliers--Singapore, Sri Lanka, EU, India, Malaysia, U.A.E.
                                                                       
  PEOPLE, HISTORY, AND CULTURE                                                
  Maldives comprises 1,191 islands in the Indian Ocean. The earliest settlers 
  were probably from southern India. Indo-European speakers followed them from
  Sri Lanka in the fourth and fifth centuries BC. In the 12th century AD,     
  sailors from East Africa and Arab countries came to the islands. Today, the 
  Maldivian ethnic identity is a blend of these cultures, reinforced by       
  religion and language.                                                      
                                                                       
  Originally Buddhists, Maldivians were converted to Sunni Islam in the       
  mid-12th century. Islam is the official religion of the entire population.  
  Strict adherence to Islamic precepts and close community relationships have 
  helped keep crime low and under control.                                    
                                                                       
  The official and common language is Dhivehi, an Indo-European language      
  related to Sinhala, a language of Sri Lanka. The writing system is from right
  to left. English is used widely in commerce and increasingly as the medium of
  instruction in government schools.                                          
                                                                       
  Some social stratification exists on the islands. It is not rigid, since rank
  is based on varied factors, including occupation, wealth, perceived Islamic 
  virtue, and family ties. Members of the social elite are concentrated in    
  Male'.                                                                      
                                                                       
  The early history of the Maldives is obscure. According to Maldivian legend,
  a Sinhalese prince named KoiMale was stranded with his bride--daughter of the
  king of Sri Lanka--in a Maldivian lagoon and stayed on to rule as the first 
  sultan.                                                                     
                                                                       
  Over the centuries, the islands have been visited and their development     
  influenced by sailors from countries on the Arabian Sea and the Indian Ocean
  littorals. Mopla pirates from the Malabar Coast--present-day Kerala state in
  India--harassed the islands. In the 16th century, the Portuguese subjugated 
  and ruled the islands for 15 years (1558-73) before being driven away by the
  warrior-patriot Muhammad Thakurufar Al-Azam.                                
                                                                       
  Although governed as an independent Islamic sultanate for most of its history
  from 1153 to 1968, the Maldives was a British protectorate from 1887 until  
  July 25, 1965. In 1953, there was a brief, abortive attempt at a republican 
  form of government, after which the sultanate was re-imposed. Following     
  independence from Britain in 1965, the sultanate continued to operate for   
  another 3 years. On November 11, 1968, it was abolished and replaced by a   
  republic, and the country assumed its present name.                         
                                                                       
  Environmental Concerns                                                      
  There is growing concern about coral reef and marine life damage because of 
  coral mining (used for building and jewelry making), sand dredging, and solid
  waste pollution. Mining of sand and coral have removed the natural coral reef
  that protected several important islands, making them highly susceptible to 
  the erosive effects of the sea. The practices have recently been banned. In 
  April 1987, high tides swept over the Maldives, inundating much of Male' and
  nearby islands. That event prompted high-level Maldivian interest in global 
  climatic changes, as its highest point is about 8 feet above sea level. The 
  Asian Brown Cloud, a U.S.-sized area of pollution over the Indian Ocean, has
  the potential of wreaking havoc on the tourism- and fishery-based Maldivian 
  economy.                                                                    
                                                                       
  Investment in Education                                                     
  The government expenditure for education was 20% of the budget in 2004. Both
  formal and nonformal education have made remarkable strides in the last     
  decade. Unique to Maldives, modern and traditional schools exist side by    
  side. The traditional schools are staffed by community-paid teachers without
  formal training and provide basic numeracy and literacy skills in addition to
  religious instruction.                                                      
                                                                       
  The modern schools, run by both the government and private sector, provide  
  primary and secondary education. As the modern English-medium school system 
  expands, the traditional system is gradually being upgraded. By early 2003, 
  every inhabited island was equipped to provide primary school education up  
  through grade seven. Secondary schools (grades 8 through 10) are available in
  atoll capitals and on the islands with larger populations. Five schools have
  higher secondary classes, two in Capital Male and in three atolls. Only     
  around 5% of students go to high school, but literacy is high at 98%.       
                                                                       
  Seven post-secondary technical training institutes provide opportunities for
  youth to gain skills that are in demand. The World Bank provided $17 million
  for education development from 2000-04. It plans to commit a further $1.5   
  million for education development, as well as $9 million for an             
  education-related component under an integrated human development project.  
  Over 2000-06, the Asian Development Bank (ADB) committed $7 million to      
  support post-secondary education development in Maldives. ADB has committed 
  $6.5 million for employment skills training over 2004-2009.                 
                                                                       
  GOVERNMENT AND POLITICAL CONDITIONS                                         
  A 1968 referendum approved the constitution, making Maldives a republic with
  executive, legislative, and judicial branches of government. The constitution
  was amended in 1970, 1972, and 1975 and is again under revision.            
                                                                       
  Ibrahim Nasir, Prime Minister under the pre-1968 sultanate, became President
  and held office from 1968 to 1978. He was succeeded by Maumoon Abdul Gayoom,
  who was elected President in 1978 and reelected in 1983, 1988, 1993, 1998,  
  and again in October 2003. The president heads the executive branch and     
  appoints the cabinet. Nominated to a 5-year term by a secret ballot of the  
  Majlis (parliament), the president must be confirmed by a national          
  referendum.                                                                 
                                                                       
  The unicameral Majlis is composed of 50 members serving 5-year terms. Two   
  members from each atoll and Male' are elected directly by universal suffrage.
  Eight are appointed by the president. A special Majlis session began meeting
  in mid-2004 to review constitutional reform issues. Regularly scheduled     
  Majlis elections took place in January 2005.                                
                                                                       
  The Maldivian legal system--derived mainly from traditional Islamic law--is 
  administered by secular officials, a chief justice, and lesser judges on each
  of the 19 atolls, who are appointed by the president and function under the 
  Ministry of Justice. There is also an attorney general. Each inhabited island
  within an atoll has a chief who is responsible for law and order. Every atoll
  chief, appointed by the president, functions as a district officer in the   
  British South Asian tradition.                                              
                                                                       
  On November 8, 1988, Sri Lankan Tamil mercenaries tried to overthrow the    
  Maldivian Government. At President Gayoom's request, the Indian military    
  suppressed the coup attempt within 24 hours. In September 2003, following the
  death of an inmate, a brief prison riot broke out on an island near the     
  capital Male'. Three other inmates were killed during the incident. In      
  response to the killings of the inmates, brief rioting took place on the    
  streets of Male'. The government often prevents opposition rallies from     
  taking place. Throughout 2006, the opposition faced restrictions on freedom 
  of assembly, and the government continued to arrest opposition activists. The
  government also keeps a tight rein on expressions of Islamic extremism.     
                                                                       
  President Gayoom's commitment to introduce political reforms in June 2004 was
  widely welcomed. A human rights commission was established, and a special   
  Majlis, or parliament, was convened to consider changes in the constitution,
  including the legalization of political parties. In August 2004, however, a 
  demonstration in the capital turned violent and the government declared an  
  emergency and arrested a large number said to be connected to the protest.  
  Some of those arrested were prominent in the reform movement, including     
  several members of the special Majlis. Most were released a few months later.
                                                                       
  The Maldives were badly hit by the Asian tsunami of December 26, 2004, which
  killed 82 and caused substantial damage to Maldives tourism, housing, and   
  fishing infrastructure. The U.S. provided $1.6 million in immediate relief  
  assistance. Despite the disaster, the Government of the Maldives held       
  parliamentary elections, originally scheduled for December 31, on January 22,
  2005. Reform candidates performed strongly. Following the poll, President   
  Gayoom announced plans to establish multiparty democracy within a year.     
                                                                       
  In June 2005, the members of the People's Majlis unanimously voted to legally
  recognize political parties. In order of registration the parties are the   
  opposition Maldivian Democratic Party, the government's Dhivehi Raiyyethunge
  Party, the Adalath (Justice) Party, and the Islamic Democratic Party.       
  Although no elections have been held since the party system was implemented,
  members of parliament have declared their political affiliations.           
                                                                       
  In March 2006, the government introduced a "Roadmap for Reform" and         
  subsequently introduced several bills in parliament. However, as of January 
  2007, parliament had not yet enacted any of the reform legislation.         
                                                                       
  Principal Government Officials                                              
  President--Maumoon Abdul Gayoom                                             
  Minister of Defense and National Security--Ismail Shafeeu                   
  Minister of Economic Development and Trade--Mohamed Jaleel                  
  Minister of Finance and Treasury--Qasim Ibrahim                             
  Minister of Home Affairs--Ahmed Thasmeen Ali                                
  Minister of Foreign Affairs--Ahmed Shaheed                                  
                                                                       
  ECONOMY                                                                     
  The Maldivian economy is based on tourism and fishing. Of the Maldives' 1,191
  islands, only 200 are inhabited. The population is scattered throughout the 
  country, with the greatest concentration on the capital island, Male'.      
  Limitations on potable water and arable land constrain expansion.           
                                                                       
  Development has been centered upon the tourism industry and its complementary
  service sectors, transport, distribution, real estate, construction, and    
  government. Taxes on the tourist industry have been plowed into             
  infrastructure and used to improve technology in the agricultural sector.   
                                                                       
  GDP in 2006 totaled $907 million, or about $3,000 per capita. The Maldivian 
  economy has made a remarkable recovery from the tsunami, which inflicted    
  damages of about $375 million, excluding $100 million in damages to resorts,
  the bulk of which was covered by private insurance. A rebound in tourism,   
  post-tsunami reconstruction, and new resort construction helped increase GDP
  by nearly 18% in 2006 from a contraction of 4.5% in 2005. Inflation has     
  moderated to about 3%. As tourism staged a speedy recovery and government   
  borrowing increased, the balance of payments recorded a surplus of about $40
  million in 2006 from a deficit of $17 million in 2005. Fiscal control has   
  deteriorated due to tsunami reconstruction as well as an increase in        
  non-tsunami-related government expenditure. Government expenditure was      
  estimated at 74.5% of GDP in 2006, compared to 36% of GDP in 2004 before the
  tsunami. The budget deficit was 18% of GDP in 2006. While reconstruction is 
  ongoing, the recovery process remains underfunded.                          
                                                                       
  The Maldives has been running a merchandise trade deficit in the range of   
  $200 to $260 million annually since 1997. The trade deficit ballooned to $386
  million in 2004, $493 million in 2005, and reached an estimated $618 million
  in 2006, largely the result of increased oil prices and increased imports of
  construction material.                                                      
                                                                       
  International shipping to and from the Maldives is mainly operated by the   
  private sector with only a small fraction of the tonnage carried on vessels 
  operated by the national carrier, Maldives Shipping Management Ltd. Over the
  years, the Maldives has received economic assistance from multilateral      
  development organizations, including the UN Development Program (UNDP), Asian
  Development Bank, and the World Bank. Individual donors--including Japan,   
  India, Australia, and European and Arab countries (including Islamic        
  Development Bank and the Kuwaiti Fund)--also have contributed.              
                                                                       
  A 1956 bilateral agreement gave the United Kingdom the use of Gan--in Addu  
  Atoll in the far south--for 20 years as an air facility in return for British
  aid. The agreement ended in 1976, shortly after the British closed the Gan  
  air station.                                                                
                                                                       
  Economic Sectors                                                            
  Tourism. In recent years, Maldives has successfully marketed its natural    
  assets for tourism--beautiful, unpolluted beaches on small coral islands,   
  diving in blue waters abundant with tropical fish, and glorious sunsets.    
  Tourism now brings in about $400 million a year. Tourism and related services
  contributed 28% of GDP in 2006.                                             
                                                                       
  Since the first resort was established in 1972, more than 87 islands have   
  been developed, with a total capacity of some 17,000 beds. Maldives has     
  embarked on a rapid tourism expansion plan. The government has awarded      
  tenders for the development of 41 resorts. Over 650,000 tourists (mainly from
  Europe) visited Maldives in 2006. The average occupancy rate is over 80%, and
  reaches over 95% in the peak winter tourist season. Average tourist stay is 8
  days.                                                                       
                                                                       
  Fishing. This sector employs about 11% of the labor force and contributes 7%
  of GDP, including fish preparation. The use of nets is illegal, so all      
  fishing is done by line. Production was about 183,000 metric tons in 2005,  
  most of which was skipjack tuna. About 50% is exported, largely to Sri Lanka,
  Japan, Hong Kong, Thailand, and the European Union. Fresh, chilled, frozen, 
  dried, salted, and canned tuna exports accounted for 94% of all marine      
  product exports. Total export proceeds from fish were about $84 million in  
  2005.                                                                       
                                                                       
  Agriculture. Poor soil and scarce arable land have historically limited     
  agriculture to a few subsistence crops, such as coconut, banana, breadfruit,
  papayas, mangoes, taro, betel, chilies, sweet potatoes, and onions. Almost  
  all food, including staples, has to be imported. The December 2004 tsunami  
  inundated several agricultural islands, which could take a significant amount
  of time to recover. Agriculture provides about 2% of GDP.                   
                                                                       
  Manufacturing. The manufacturing sector provides only about 7% of GDP.      
  Traditional industry consists of boat building and handicrafts, while modern
  industry is limited to a few tuna canneries, a bottling plant, and a few    
  enterprises in the capital producing PVC pipe, soap, furniture, and food    
  products. Five garment factories that had exported principally to the United
  States closed in 2005, following the expiration of the Multi-Fiber          
  Arrangement (MFA) that had set quotas on developing country garment exports 
  to developed countries. The loss of these factories has not proven an       
  insurmountable hurdle, however, as most of the profits were repatriated and 
  most of the labor was expatriate.                                           
                                                                       
  FOREIGN RELATIONS                                                           
  Maldives follows a nonaligned policy and is committed to maintaining friendly
  relations with all countries. The country has a UN Mission in New York, with
  the Permanent Representative to the UN in New York also accredited as       
  Ambassador to the United States, an embassy in Sri Lanka and in the United  
  Kingdom, a trade representative in Singapore, and a Tourist Information     
  Bureau in Germany. India, Pakistan, Bangladesh, and Sri Lanka maintain      
  resident embassies in Male'. Denmark, Norway, the U.K., Germany, Turkey, and
  Sweden have consular agencies in Male' under the supervision of their       
  embassies in Sri Lanka and India. The UNDP has a representative resident in 
  Male', as do the UN Children's Fund (UNICEF) and the World Health           
  Organization (WHO). Like the United States, many countries have nonresident 
  ambassadors accredited to the Maldives, most of them based in Sri Lanka or  
  India. The Maldives is a member of the Organization of the Islamic Conference
  (OIC) and the Non-Aligned Movement (NAM).                                   
                                                                       
  U.S. MALDIVIAN RELATIONS                                                    
  The United States has friendly relations with the Republic of Maldives. The 
  U.S. Ambassador and some Embassy staff in Sri Lanka are accredited to the   
  Maldives and make periodic visits. The United States supports Maldivian     
  independence and territorial integrity and publicly endorsed India's timely 
  intervention on behalf of the Maldivian Government during the November 1988 
  coup attempt. U.S. Naval vessels have regularly called at Male' in recent   
  years. The Maldives extended strong support to U.S. efforts to combat       
  terrorism and terrorist financing in 2001-02.                               
                                                                       
  U.S. contributions to economic development in the Maldives have been made   
  principally through international organization programs. Following the      
  December 2004 tsunami, the U.S. and Maldives signed a bilateral assistance  
  agreement for $8.6 million in reconstruction assistance. This assistance will
  help in the rebuilding of harbors, sewerage systems, electrical generation  
  facilities and in the development of aid absorption capacity in the Ministry
  of Finance. The United States has directly funded training in airport       
  management and narcotics interdiction and provided desktop computers for    
  Maldivian customs, immigration, and drug-control efforts in recent years. The
  United States also trains a small number of Maldivian military personnel    
  annually. About 10 U.S. citizens are resident in the Maldives; some 5,000   
  Americans visit the Maldives annually. The Maldives welcomes foreign        
  investment, although the ambiguity of codified law acts as somewhat of a    
  damper. Areas of opportunity for U.S. businesses include tourism,           
  construction, and simple export-oriented manufacturing, such as garments and
  electrical appliance assembly. There is a shortage of local skilled labor,  
  and most industrial labor has to be imported from Sri Lanka or elsewhere.   
                                                                       
  Principal U.S. Embassy Official                                             
  Ambassador--Robert O. Blake                                                 
                                                                       
  The U.S. Embassy in Sri Lanka is at 210 Galle Road, Colombo 3; tel: +94 (1) 
  244-8007; fax: +94 (1) 2437-345.                                            
                                                                       
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  For the latest security information, Americans living and traveling abroad  
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  Further Electronic Information                                              
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