FATF status

The Maldives is not on the FATF List of Countries that have been identified as having strategic AML deficiencies

Compliance with FATF Recommendations

It should be noted that the new style FATF Mutual Evaluation has not yet been undertaken.

The last Mutual Evaluation Report relating to the implementation of anti-money laundering and counter-terrorist financing standards in The Maldives was undertaken by the Financial Action Task Force (FATF) in 2011. According to that Evaluation, The Maldives was deemed Compliant for 1 and Largely Compliant for 0 of the FATF 40 + 9 Recommendations. It was Partially Compliant or Non-Compliant for all 6 of the Core Recommendations.

Since acceding to the UN Convention against Corruption in 2007, the Maldives has struggled with corruption, reflected in its decline to 93rd on the Transparency International Corruption Perceptions Index in 2023, despite an improvement in its score. Although the Anti-Corruption Commission investigates allegations against government officials, its effectiveness is hampered by weak enforcement and a narrow legal definition of corruption. Recent regulatory changes and efforts by the previous administration aimed to enhance transparency, but challenges remain in addressing corruption at all societal levels.

The economy of the Maldives is heavily reliant on tourism, which contributes nearly 30% to the GDP and accounts for over 60% of foreign currency earnings. Following a significant decline due to the COVID-19 pandemic, the tourism sector has shown signs of recovery, with 1.88 million tourist arrivals in 2023. Despite a projected economic growth of 6.5% in 2023, challenges such as income inequality and limited employment opportunities persist, particularly in remote atolls.

The investment climate in the Maldives is characterized by an open policy towards foreign investment, particularly in the tourism and hospitality sectors, which dominate the economy. However, challenges such as ambiguous laws and competition from politically influential local businesses can deter potential investors. In 2023, there were 30 new foreign direct investments, primarily in tourism, indicating ongoing interest despite these challenges.