MMA: Most industries expanded in Q1 as firms flag supply chain concerns
According to the report, all major industries except construction recorded improvements in business activity during the quarter.
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Most businesses in the Maldives reported improved performance during the first quarter of 2026, although concerns over geopolitical developments, supply chain disruptions and access to finance have led to weaker expectations for the current quarter, according to the Maldives Monetary Authority (MMA).
The findings are contained in the MMA's Quarterly Business Survey for the first quarter of 2026, released on Sunday. The survey gathered responses from 97 large enterprises across key sectors of the economy.
According to the report, all major industries except construction recorded improvements in business activity during the quarter. Businesses in every surveyed sector also reported increases in employment levels.
Tourism growth continues, but outlook softens
Tourism businesses reported growth during the first quarter, although at a slower pace than in previous quarters.
The report noted that expectations for the second quarter have weakened as the peak tourism season comes to an end.
Geopolitical developments also affected the sector. According to the survey, 94 per cent of tourism businesses said the conflict involving Iran had negatively affected tourism revenue and bookings during the quarter.
Construction sector reports decline
Construction was the only sector to record a decline in business performance during the first quarter.
Businesses in the sector also expect conditions to weaken further during the second quarter.
The report found that disruptions to imports linked to the closure of the Strait of Hormuz had affected 61 per cent of construction businesses.
Trade sector expands
Businesses in the wholesale and retail trade sector reported growth during the quarter.
The survey showed increases in both the cost of goods sold and average selling prices.
Despite the expansion, businesses in the sector expect activity to slow during the current quarter.
Transport and communication records third consecutive quarter of growth
The transport and communication sector continued its upward trend, recording growth for a third consecutive quarter.
However, business expectations for the second quarter have declined.
The report found that 81 per cent of businesses in the sector experienced negative effects from disruptions linked to the closure of the Strait of Hormuz.
Costs rise and credit conditions tighten
Across all sectors, businesses reported increases in input costs and selling prices during the first quarter.
For the current quarter, firms in the tourism and wholesale and retail sectors expect input costs to continue rising, although at a slower rate.
The survey also found that access to credit became more difficult during the first quarter for all sectors except tourism. While tourism businesses continued to report relatively easier access to financing, conditions were less favourable than in previous quarters.
Looking ahead, businesses across all sectors expect lending conditions to tighten further and anticipate greater difficulty in obtaining credit during the second quarter.
