Justiceface
Justiceface
Jun 04, 2026
Maldives

Fitch Upgrades Maldives Credit Rating to 'CCC-'

Fitch Ratings has upgraded the Maldives’ Long-Term Foreign-Currency Issuer Default Rating (IDR) to 'CCC-' from 'CC', citing reduced default risks following the successful repayment of the country’s USD500 million sukuk in April and improvements in its near-term external financing outlook.

Details of the Upgrade

The ratings agency stated that the upgrade reflects a lower risk of default after the government met its largest external debt obligation of the year and continued implementing measures aimed at strengthening foreign currency inflows, including revenue reforms and the Foreign Currency Act.

Economic Implications

According to Fitch, the Maldives’ ability to service external debt has improved considerably following the sukuk repayment, with sovereign and publicly guaranteed external debt obligations falling to USD535 million in the second half of 2026, compared with USDi.1 billion in the first half of the year.

However, Fitch projects that the Maldives’ current account deficit will widen sharply to 17.5 percent of GDP in 2026, up from 8.4 percent in 2025, driven by higher import costs and weaker services exports amid global economic disruptions.

Government Response

Responding to the rating action, the Ministry of Finance and Public Enterprises said the upgrade reflects growing confidence in the Maldives’ economic management despite challenges posed by the global environment. The ministry acknowledged that ongoing conflict in the Middle East has created economic headwinds but stated that the Maldives is better positioned to withstand external pressures due to recent fiscal and monetary policy reforms and an improved liquidity outlook.

Future Outlook

Fitch pointed to factors that could support future upgrades, including stronger external reserves, sustained access to foreign financing, and meaningful progress in reducing public debt through fiscal consolidation. However, the agency maintained that while default risks have eased, the Maldives’ credit profile remains constrained by persistent fiscal and external vulnerabilities.