Support to the National Response to contain the impact of COVID-19

Situational Analysis

The first case of COVID-19 in Maldives was reported on 7th March. As of 8 April, the number has increased to 19 cases. The pandemic has severely impacted the national economy and livelihoods. According to preliminary estimates by the Ministry of Finance, the COVID-19 could reduce GDP growth rate from the forecasted 7.5% for 2020 to 0.5% or even to -5.6% depending on the severity of the pandemic; however, World Bank worst case scenario projects a 13 percent fall in Maldives’ GDP in 2020. The public revenue might suffer losses in the range of $135.9 million to $446.6 million mostly through the pandemic impact on tourism which accounts for 28% of the GDP and generates 20% of Maldives total employment. Recent government updates suggest a negative growth of up to 50% for the tourism sector as the country continues to remain locked down to tourists. The country estimates $400 million decline in the receipt of foreign exchange.

The government has announced an Economic Recovery Plan of $162 million, equal to 2.8% of the GDP, to keep businesses afloat and to maintain employment and consumption.  Local businesses including informal sector could access this facility provided they don’t lay off their staff to maximum extent possible. The economic stimulus package also covers 3-month payment allowance to individuals whose jobs are affected by the pandemic. Furth government support includes debt moratorium of 6 months, injection of additional liquidity into banks, reduced interest rates for SMEs and agri-businesses and delayed loan payment options. The government is implementing measures to reduce public expenditure by more than $ 64.8 million.

The pandemic brings implications for poverty and inequality in the country. Many Maldivians are just above the poverty line and face the risk of falling into poverty again. There exist inequalities is human development outcomes across different regions: Human Development Index value for all atolls excluding Male is 0.627 compared to 0.734 in Male.  Similarly, many atolls, such as the South Huvadhu Atoll (GDh), North Maalhosmadulu (R), North Ari Atoll (AA), South Nilandhe Atoll (Dh), Kolhumadulu (Th) and Addu (S), have higher poverty headcount ratios than the national average. COVID-19 could further increase the incidence of poverty and inequality.

The UN has developed Crisis Preparedness and Response Plan (CPRP) for COVID-19 led by WHO. UNDP contributes to the CPRP and is undertaking a rapid assessment of the impact of COVID-19 on the livelihood and economy, in particular the tourism sector. The findings of the assessment will inform interventions to minimize the impact of the pandemic on poor and vulnerable populations. UNDP is providing technical support to prevent gender-based violence and promote access to justice for vulnerable population during the current crisis. This is done by enhancing capacity of concerned institutions through technological innovation and multi-stakeholder response and crisis management. UNDP will provide support to the local government at the island level for impact monitoring of the government economic stimulus package. UNDP is leveraging its established partnerships with the government at all levels, civil society organizations and communities to provide timely response to the COVID-19.

Areas of intervention

 

Socio-economic impact and needs assessment

UNDP’s ongoing impact assessment of COVID-19 on tourism sector and livelihoods put UNDP in best position for socio-economic response to COVID-19 by:

Designing and implementing large livelihoods and economic recovery programmes, providing immediate socio-economic relief to the most affected households at the sub-national level and in particular women entrepreneurs

Designing and formulating SME and livelihood support to increase food security and income for those who lost jobs in collaboration

Helping in designing, delivering and impact monitoring of social protection schemes and economic stimulus packages especially at the micro level

Developing standard operating procedures (SOPs) for the government and other organizations to assist affected businesses, reskilling and encouraging businesses towards sustainable development and local production to reduce import dependency.

Inclusive and integrated Crisis Management and Response

As part of the UN Crisis Preparedness and Response Plan, UNDP could lead the early recovery response to COVID-19. It can:

Support public awareness and community engagement at national and sub-national level

Facilitate multi stakeholders’ coordination and response

Manage small and large grants schemes. UNDP has extensive experience in managing small grants programme of the Global Environmental Facility

Provide integrated policy advice for social safety nets, economic resilience and recovery

 

Health System's and Procurement Support

UNDP Maldives could leverage its corporate systems and capacities at the regional and global level to strengthen national and sub-national health system by:

Rapidly responding to COVID-19 including procuring urgently needed health and medical supplies building on our Global Fund work in 50 countries to address health procurement and supply chain management including use of health technologies and access to treatment

Expert advice on the specification, quantification, sourcing and quality assurance of health products and equipment

Community outreach for needs identification, provision and monitoring of health supplies in particular for the hard to reach populations

The focus of UNDP support is to help vulnerable populations cope with the impact of COVID-19. As part of UNDP Maldives integrated government support, UNDP is strengthening national and sub national institutional capacity in collaboration with civil society organizations and other partners for continued and improved public services to the vulnerable population. These include access to justice and leveraging digital solutions to expand outreach at all levels.

 

UNDP Around the world

You are at UNDP Maldives 
Go to UNDP Global