VP Latheef: President's 40% resort dollar conversion is a public-interest move

Vice President Hussain Mohamed Latheef says President Dr. Mohamed Muizzu’s decision to require resorts to convert 40 percent of their dollar revenue is a measure taken in the public interest and aimed at stabilising the country’s foreign exchange situation.

Speaking on MMTV on Saturday, Latheef said increasing the proportion of foreign currency channelled through Maldivian banks would benefit both the public and local businesses. He described the move as a “strong, far-sighted political decision” by the President to address the persistent shortage of dollars and improve circulation in the economy.

“It benefits the people of Maldives and the businessmen of Maldives. He has taken a strong, very far-sighted political decision to put an end to the lack of dollars and the lack of circulation in the country's economy,” he said.

Latheef acknowledged that some parties would be unhappy with the change, but said the government inherited an economy “in a state of extreme poverty” and needed to take decisive steps to rebuild it.

Meanwhile, opposition MDP Chairman and former President Mohamed Nasheed warned on Saturday that forcing resorts to convert 40 percent of their dollar income would “irresistibly bankrupt” resort businesses and harm other sectors linked to tourism. In a post on X, Nasheed said the measure posed a major threat to investor confidence and long-term stability in the tourism industry.

Last week, Parliament amended the Foreign Exchange Act to mandate that resorts deposit 40 percent of their monthly dollar revenue in Maldivian banks, a sharp increase from the previous 20 percent requirement.

The Maldives Association of Tourism Industry (MATI) has also expressed concern over the change. In a statement, MATI said resorts rely heavily on USD to pay salaries, service charges, taxes, rent and foreign-currency loans, and warned that the new requirement was not viable for the industry.