TSCPL Participates in a National Workshop to Formulate an Economic Diversification Framework for the Maldives

Senior Consultant at TSCPL, Raniya Sobir is part of a team of consultants contracted by the Ministry of Economic Development, Government of Maldives to develop an economic diversification strategy for the Maldives. Despite the economic progress achieved in the last few decades, in global terms, the Maldivian economy continues to be relatively small with a narrow economic base. The GDP growth historically has been driven by tourism and fisheries sectors – two sectors which are largely affected by external factors, thereby making the Maldivian economy extremely vulnerable to exogenous shocks. The tourism sector, contributing 32% to GDP continues to play a significant role in driving economic growth. More recently, construction has replaced fisheries as the second most significant industry contributing to GDP with the former accounting for 10% and the later a meager 1.3% of GDP. Overdependence on the tourism sector and the diminishing significance of the fisheries sector in GDP warrants special attention from a strategic economic planning perspective.

The issue deserves immediate attention, if considered together with the high rates of unemployment among the youth population and the widening income/development in-equities between Male’ and outer islands. Global economic conditions and financial market volatilities, rising oil prices, climate change and trends towards creating greener knowledge economies have a direct bearing on how such a new economic deal should be shaped in the Maldives. Taking into consideration the above economic conditions and changing global trends, the government of Maldives aimed to create a national economic diversification framework paper and related strategy documents to operationalize the framework document in the near to medium term.

The National Workshop held on 7 January 2013 in Bandos Island Resort, Maldives, was a culmination of a series of consultations conducted by the team with a wide range of stakeholders including the government, the private sector and NGOs. The workshop was inaugurated by the Vice President of the Maldives His Excellency Mohamed Waheed-Deen. The workshop was attended by high level officials including members of cabinet, government and private sector representatives of more than ten sectors including tourism, fisheries, agriculture, energy, information and communication technology, transport, health, education, financial services etc. Following the feedback and recommendations received from the workshop, the team will submit a final report to the Government detailing the key strategies for diversifying the Maldives economy.