Fitch says Maldives has repaid majority of 2026 external debt obligations

The Maldives has already settled more than half of its external debt obligations due this year, according to Fitch Ratings.

The information was disclosed in the rating agency's latest report, released alongside its decision to upgrade the Maldives' sovereign credit rating from 'CC' to 'CCC-'.

According to Fitch, the Maldives faced external debt obligations of approximately USD 1.1 billion during the first six months of the year.

A substantial portion of that amount consisted of the USD 500 million sovereign Sukuk that matured and was repaid in April.

Fitch said the country's remaining external debt obligations for the second half of the year total USD 535 million.

The agency noted that the repayment of the Sukuk had reduced near-term debt servicing pressures and was a key factor behind the decision to raise the country's sovereign credit rating.

In response, the Ministry of Finance said the development reflected the government's debt management policies and efforts to meet external obligations while maintaining public services and economic activity.

According to the ministry, the debt repayments were supported by measures aimed at increasing government revenue, improving foreign currency management and strengthening cooperation with international financial institutions and partner countries.

The ministry also stated that the reduction in debt obligations would provide additional fiscal space to support expenditure management, economic stability and foreign exchange reserves.

It added that the government would continue implementing debt management measures and structural reforms aimed at maintaining debt at sustainable levels.

The Maldives is also rated by Moody's Investors Service. In November last year, Moody's affirmed the country's rating at 'Caa2' and revised its outlook from negative to stable.

So far this year, the Maldives has completed several major external debt repayments, including:

Fitch stated that the completion of these repayments has reduced short-term financing risks and improved the country's external debt profile for the remainder of the year.