The government of Maldives requested the support of Russia and Turkey to address the economic and financial challenges arising from the ongoing COVID-19 pandemic.
Minister of Foreign Affairs Abdulla Shahid made the request on separate phone calls to his Russian and Turkish counterparts, Sergey Lavrov and Mevlüt Çavuşoğlu, on Monday.
According to the foreign ministry, Shahid briefed the two ministers on the impact of the pandemic on Maldives, as well as measures taken by the government to curb the spread of the coronavirus.
He discussed the economic and financial consequences of COVID-19 and requested the assistance of Russia and Turkey to help overcome them.
The foreign ministry noted that all three diplomats stressed the importance of collaborative efforts to combat the pandemic, and asserted their commitments to the cause.
Maldives stands to see the worst economic recession in South Asia due to the COVID-19, as per the World Bank. Amid global travel restrictions imposed due to the pandemic, and the detection of local transmission in the community, Maldives closed its borders on March 27, bringing the tourism industry, the country's main source of income, to a deadlock.
As over 70 percent of the country’s GDP is attributed to revenue generated by the tourism industry, the economy continues to face severe repercussions due to travel restrictions imposed over the COVID-19 outbreak. It is estimated that the country will face a shortfall of approximately USD 450 million (MVR 6.9 billion) in foreign currency.
The government projected that the state deficit will reach MVR 13 billion this year due to the pandemic, while the national debt is projected to increase to MVR 70 billion. State revenue is expected to nosedive to MVR 15.2 billion, nearly halving the revenue of MVR 29.9 billion projected in the 2020 budget.
In a bid to counteract the financial impact of the COVID-19 pandemic on the local economy, the government has introduced a financial stimulus package with MVR 2.5 billion intended to prevent the closing down of local businesses and the loss of jobs.
Maldives is also seeking financial assistance from international institutions to address the challenges. Ministry of Finance disclosed earlier this month that the government aims to secure MVR 233 million from foreign bodies and countries with which Maldives has established bilateral ties, to offset the economic repercussions of the COVID-19 pandemic.