Published analysis
Read the full article on Maldives News: The conversion mandate treats the symptom, not the cause
Standfirst. Reports of a rise to 40 percent are unconfirmed. The case against the mandate does not rest on them.
Key facts
- Social media reports say the MMA is weighing a rise in the mandatory conversion requirement on tourism revenue from 20 percent of gross sales to 30-40 percent; the MMA has confirmed nothing and no document has surfaced.
- The opposite account also stands unconfirmed: MATI said in February 2026 the governor told operators he intended to repeal mandatory conversion and move toward a float.
- Delivered dollars under the existing mandate: 182 resorts exchanged USD 671m in 2025, USD 523.4m of it passing to the MMA; the government exchanged USD 214m between January and April 2025, per President Muizzu.
- Reserves fell to a record low USD 371.2m in September 2024 and were rebuilt to USD 1.03bn by January 2026.
- The IMF’s 2024 Article IV found the MMA’s own rationing of foreign currency to banks and state enterprises channels dollars into the parallel market; the parallel rate hit a record 21.75 on 5 August 2026, about 41 percent over the 15.42 peg.
- More than MVR 8bn was printed 2020-2023 under a suspended Fiscal Responsibility Act; excess liquidity stood at MVR 7bn by June 2025, up 178 percent since 2020.
Signals & links
Dollar Shortage · Foreign Exchange · FX Regulation · Government Fiscal Position · Maldives Monetary Authority · Tourism Industry · Maldives Economy