In a recent statement, Maldives Foreign Minister Moosa Zameer outlined the country's approach to addressing its financial difficulties through tax hikes and reforms, as it works to meet its debt servicing obligations. Speaking from Colombo on Friday night, Zameer emphasized that the Maldives, renowned for its luxurious resorts and high-profile visitors, is taking measures to stabilize its economy.

"We have bilateral partners who are very sensitive to our needs and our situation," Zameer told reporters. He expressed confidence that the current financial challenges are temporary, attributing the situation to a dip in foreign reserves rather than a broader economic crisis. The Minister indicated that the country is not currently considering engagement with the International Monetary Fund (IMF) but is focusing on internal measures such as tax reforms and the rationalization of state-owned enterprises to improve liquidity.

Zameer, along with Finance Minister Mohamed Shafeeq, was in Sri Lanka to meet with central bankers and other officials. The Maldives' primary bilateral lenders are China and India, two major stakeholders in the country’s financial landscape. President Mohamed Muizzu, who assumed office a year ago, campaigned on a platform of shifting foreign policy priorities, including the removal of Indian troops and fostering closer ties with China.

Despite initial tensions with India, Zameer reported that relations have since improved. "At the start of our government, we did have some rough patches," he acknowledged, "but we have fantastic bilateral relations with both China and India. Both countries continue to support us."

China has significantly increased its financial support following Muizzu’s election, and the Maldives' President has publicly thanked China for its development aid. Official data reveals that the Maldives' foreign debt stood at $3.37 billion in the first quarter of this year, about 45 percent of the country’s gross domestic product. Of this debt, China accounts for approximately 20 percent, while India holds just under 18 percent.

Zameer’s visit coincides with recent financial setbacks, including Moody’s Ratings' downgrade of the Maldives' credit rating to Caa2, indicating high credit risk. Fitch Ratings had similarly downgraded the country in June, citing declining foreign currency reserves and the strain of significant debt servicing obligations, which total $409 million this year.