The Maldives Monetary Authority (MMA) has announced plans to amend the Foreign Exchange Rules, requiring resorts to exchange 20 percent of their US dollar revenue and removing the existing option to exchange a fixed amount based on tourist arrivals.
Under the current framework, resorts classified as Category A businesses can choose between exchanging USD 500 for each tourist staying at the property or exchanging 20 percent of their total foreign currency revenue.
The proposed amendment will remove the USD 500-per-tourist option, making the 20 percent revenue-based requirement mandatory for all resorts.
The move will standardize the foreign currency exchange obligation for the resort sector and increase the proportion of tourism-generated foreign currency channeled through the domestic financial system.
The MMA said the proposed changes will not alter the requirements currently applicable to Category B businesses, including guesthouses, or Category C businesses, including safari vessels. These businesses will continue to be required to exchange 20 percent of their applicable US dollar revenue.
Changes Proposed for Non-Tourism Businesses
The central bank is also proposing changes to foreign exchange requirements for non-tourism businesses earning revenue in foreign currency.
Under the proposed amendment, the mandatory foreign currency exchange requirement will apply to businesses generating more than USD 25 million annual foreign currency revenue.
The existing rules apply the mandatory exchange requirement to businesses receiving US dollar revenue exceeding the equivalent of MVR 15 million.
The proposed revisions represent another adjustment to the Maldives’ foreign exchange framework as the MMA seeks to regulate the flow of foreign currency generated by the tourism industry and other major foreign currency-earning businesses.
For the resort sector in particular, removing the per-tourist option will shift the mandatory exchange mechanism entirely towards a revenue-based model, directly linking the amount of foreign currency resorts must exchange to their US dollar earnings.