The credit rating of the Maldives will continue to improve in the future, Mohamed Hussain Shareef, the Chief Government Spokesperson, announced during a 'Presser with the Spox' briefing, addressing strategic measures to elevate the nation's standing. Fitch Ratings recently upgraded the country's Long-Term Foreign-Currency Issuer Default Rating from 'CC' to 'CCC-', a level achieved amidst significant challenges, the government noted.
The administration will officially celebrate only when a larger advancement is secured, the spokesperson stated, clarifying that two previous rating declines during the current term were not caused by the administration's policies. Instead, maintaining the rating last year and securing the current upgrade stems from decisive actions taken to service the national debt.
"The Fitch report consistently articulates the precise rationale behind any downward or upward adjustments to the nation's standing," Shareef explained. "We have now successfully secured an upgrade. The current assessment explicitly acknowledges the positive fiscal measures that facilitated this improvement, while simultaneously outlining further policy actions required for continued progress."
He continued, "If these recommended steps are not strictly implemented, there remains an inherent risk of a subsequent downgrade. We remain highly optimistic that our credit rating will achieve further enhancements during the next review cycle. The previous declines in our financial standing were in no way a consequence of the current administration’s policies."
The downward trajectory was driven by inherited debts, their durations, and original purposes. Overlapping repayment schedules created obstacles in fulfilling financial obligations, causing the initial decline from a 'B' rating held in 2021, which had been driven down by the Covid-19 pandemic. While investor confidence is solidifying, Fitch strongly advocates for the sustainable management and organisation of fiscal affairs amidst global economic headwinds.