The European Investment Bank (EIB) has decided to extend a USD 22.5 million loan to the Maldives to aid economic recovery following the COVID-19 pandemic.
EIB released a press statement on June 15, announcing the loan facility has been signed with the Ministry of Finance of the Maldives as part of efforts to help sustain the local economy, protect jobs and support SMEs operating in the tourism sector in the wake of the COVID-19 pandemic. EIB revealed this is the first COVID-19-related operation of the EU bank in Asia, and a part of its USD 5.86 billion support package for countries outside the EU, announced in April.
The EIB funds will be available to local SMEs at the Bank of Maldives (BML). Noting tourism and related sectors contribute as much as 40% to national GDP of the Maldives, EIB stated the loan will be crucial for the stabilisation of the local economy, adding it will also enable the Maldives to recover faster from the economic effects of the pandemic.
Vice President of EIB Andrew McDowell said the bank is happy for the opportunity to support robust economic growth in the Maldives and help the country improve its macroeconomic outlooks in the wake of the COVID-19 pandemic. He noted the loan will support local SMEs, sustain jobs, and have a positive impact on the stability of the local financial market.
Meanwhile, Minister of Finance Ibrahim Ameer extended the appreciation of the people and the government of the Maldives for the swift support provided by the EIB during this time of crisis. The finance minister said this underscores the close relationship between the EU and the people of the Maldives, as was also demonstrated by the support from the EIB after the devastating Indian Ocean tsunami in 2004. He added the loan facility will contribute immensely to the efforts to support local businesses and protect livelihoods during the COVID-19 pandemic and the ensuing economic downturn.
This is the third operation for the EIB in the Maldives since the beginning of operations in the country in 2005. In addition to helping the Maldives reach United Nations Sustainable Development Goals (SDG), EIB supports the EU priorities in the region and the outcomes and commitments of the 2019 EU-Maldives dialogue.