Report by: Shifneen Rasheed & Daha Shuaib
The year 2016 was a year of ups and downs for the Maldivian economy. While some sectors experienced lackluster growth within the year, developments in other major sectors such as the construction sector were impressive. According to the quarterly GDP statistics for the first two quarters of 2016, the overall performance of the economy looked robust with an average growth of 5.4%. However, tourism sector growth, which accounts for the lion’s share of the country’s economic growth fell below expectations owing to weaknesses in the global economy. Despite this, growth was largely propelled by a robust expansion in the construction sector.
After experiencing two consecutive years of negative growth in 2012 and 2013, the construction sector of the country boomed and registered growth rates over 20% in the two years that followed. Similarly, construction sector growth continues to strengthen in 2016, as evidenced by the quarterly GDP statistics for Q1 and Q2 of the year.
The sector registered growth rates of 18.2% and 12.8% for Q1 and Q2 of the year, respectively. Another important indicator to gauge the sector growth for the year is construction sector-related imports. Such imports rose by 20% in annual terms during the period Jan-Nov 2016, indicating fast-paced sectoral growth within the year.
A weighty portion of the construction sector activity for the year consisted of work on large public sector infrastructure projects, residential housing and resort development
projects. Of this, the construction of the historic landmark, the China-Maldives Friendship Bridge is a remarkable project that commenced in early 2016. The bridge, estimated to be completed and opened in 2018, will improve the socioeconomic growth of the country by easing transportation between the airport and the two largest residential and commercial islands in Maldives.
The year 2016 also saw the development of the Male’ industrial village in the southern region of the capital city. All industrial activities currently carried out across the city will be shifted to this area; notably, waste management, heavy vehicle parking, warehouses and fuel stations. Reclamation work to expand the area was carried out during mid 2016 where 6.9 hectares of land were reclaimed.
Additionally, the government launched a megaproject to redevelop the roads of the capital city, Male’ with the aim of making the roads easily accessible and safe for everyone. The project began in October 2016 and will redevelop 13 major roads of the city by September 2018. Furthermore, several other projects such as the development of parks were also carried out during the year.