Maldives President Defends New Forex Amendment, Assures Resorts Will Face No Disruption

President Dr Mohamed Muizzu has firmly defended the newly ratified amendments to the Foreign Exchange Act, assuring the tourism sector that mandatory requirements to exchange 40 percent of foreign currency revenue through local banks will not hinder business operations, loan repayments, or staff salaries.

Speaking at a special ratification ceremony held at the President’s Office, President Muizzu signed the new legislative amendments into law alongside other parliamentary bills. He expressed confidence that the sweeping financial reforms, once fully implemented, will deliver substantial convenience and stability to the general public.

Under the updated statutory framework, resort operators are now legally required to channel 40 percent of their monthly foreign currency earnings through domestic banks—a significant increase from the previous 20 percent baseline. Meanwhile, guesthouse operators remain subject to a separate formula, requiring them to exchange USD 25 per tourist or 20 percent of total revenue.

Addressing industry pushback, President Muizzu stressed that the elevated threshold was not an impulsive measure, but the result of rigorous academic and technical research conducted jointly by the Maldives Monetary Authority (MMA), the Ministry of Finance, and the Ministry of Economic Development.

I respectfully state that we are fully confident resorts will face no difficulty exchanging 40 percent. Exchanging 40 percent will not hamper loan repayments for resort construction, staff salaries, or operational expenses. That is certain,” he said.

To substantiate the policy shift, the President highlighted stark disparities in national financial data from the previous year. While the tourism sector generated an estimated USD 5.6 billion, only USD 3.8 billion reportedly entered the domestic banking system. Additionally, MMA statistics indicate that just 21 percent was formally exchanged locally prior to the new law.

The administration anticipates that the increased influx of foreign currency into the central bank will bolster national reserves, directly facilitating essential imports and streamlining foreign business transfers, known as TTs. Pointing to the active black-market circulation of high-rate dollars, the President argued that the currency is readily available within the market, proving that the 40 percent conversion rate is entirely manageable.

Significantly, President Muizzu directly addressed the anxieties of resort employees, stepping in to alleviate concerns sparked by recent comments from MMA Governor Ahmed Munawwar—who had previously suggested transitioning employee salaries to Maldivian Rufiyaa by 2030 to ease dollar scarcity.

Reassuring the workforce, the President emphasised that the government supports paying resort personnel in US dollars and that this practice should remain untouched. He reiterated that resorts retain more than enough revenue to comfortably cover payroll and loan obligations while still meeting their 40 percent legal obligation.

President Muizzu issued a call to action for the tourism sector, urging all resort operators to comply with the legislation and fulfill their patriotic duty toward national economic stability.