The
Maldives are an archipelago of 1,192 coral islands grouped into 26 coral
atolls (200 inhabited islands, plus 80 islands with tourist resorts) in
the Indian Ocean. They lie south-southwest of India and are considered
part of Southern Asia. Tourism, Maldives largest industry, accounts for
20% of GDP and more than 60% of the Maldives' foreign exchange receipts.
Over 90% of government tax revenue comes from import duties and
tourism-related taxes. Over 600,000 tourists visited the islands in 2006.
Fishing is a second leading sector. The Maldivian Government began an
economic reform program in 1989 initially by lifting import quotas and
opening some exports to the private sector. Subsequently, it has
liberalized regulations to allow more foreign investment. Agriculture and
manufacturing continue to play a minor role in the economy, constrained by
the limited availability of cultivable land and the shortage of domestic
labor. Most staple foods must be imported. Industry, which consists mainly
of garment production, boat building, and handicrafts, accounts for about
18% of GDP. Maldivian authorities worry about the impact of erosion and
possible global warming on their low-lying country; 80% of the area is one
meter or less above sea level.
