Maldives government defends new resort foreign exchange rules

The Maldives government has denied allegations that it failed to consult the tourism sector before implementing new foreign exchange requirements. The President’s Office disputed reports claiming the industry was surprised by the changes, asserting that the Maldives Association of Tourism Industry (MATI) participated in discussions with senior officials prior to the ratification of the Foreign Exchange Act amendments.

The new regulations, which took effect on September 1, require Category A tourism establishments to exchange 40 percent of their monthly gross sales through the official banking system. Category B establishments are required to exchange either USD 25 per tourist arrival or 20 percent of their monthly gross sales.

Chief Government Spokesperson Mohamed Hussain Shareef stated that the policy was developed following research by the Ministry of Finance to address US dollar shortages. While MATI has expressed concerns that the 40 percent requirement imposes a financial burden due to foreign currency expenses, the government maintains that multiple meetings were held, including one on August 23, to seek industry input. Additionally, the spokesperson alleged that several businesses have recently routed approximately USD 79 million into the parallel foreign exchange market.