Maldives today (geographic and economic overview)

The Maldives digital economy has been rapidly transforming the business landscape, with significant growth and investment across diverse industries. Even with a scattered population of 500,000+ people across 189 islands, the country has been able to tackle logistical challenges in infrastructure development. It acknowledges the significance of a robust digital economy to complement and support its strong tourism sector while fostering long-term growth. This recognition fuels its ambitious plans to bridge the digital divide and create a more inclusive economy.

Communications and connectivity 2023

The Maldives boasts a surprisingly strong network and communications infrastructure, laying a solid foundation for its digital economy.

Despite the unique geographical challenges presented by its population with a majority residing in Greater Male’ and the remaining 46% spread across 186 islands averaging only 1,273 inhabitants – the Maldives has achieved impressive results according to leading indexes.

Ranked 30th in the world for internet speed and connectivity by Ookla and receiving a score of 95.1 in Network Coverage by GSMA’s mobile connectivity index 2022, the country demonstrates strong performance.

This is further bolstered by its high fibre-to-the-home (FTTH) coverage of 87% and mobile market penetration exceeding 129%, with the country having a pioneer role in South Asia, having launched 5G.

Looking ahead, Ooredoo Maldives’ investment in the PEACE cable and Dhiraagu’s contract for the SEA-ME-WE 6 submarine cable system promise to further enhance international connectivity, solidifying the Maldives’ position as a well-connected nation.

Pillar 1: Rise of Digital Banking and Mobile Payments

Improved connectivity across the Maldives has led to nationwide access to online banking and mobile payment applications.

This is a significant improvement for the country as it previously faced issues with inter-bank money transfers. To address this, the central bank launched Favara, an instant payment system that enables swift money movement between local banks. This is the first phase of a broader plan aimed at streamlining financial transactions in the country.

Banks and telecom operators have collaborated to introduce digital wallet applications in 2022, furthering the country’s move towards contactless payments. While adoption rates are improving rapidly, there is a focus on robust security measures and customer data protection that will accelerate this trend in the coming years.

The Maldivian banks have embraced digital transformation and are leading the charge in digital innovation. The leading bank reported over 800 million customer logins to its digital channels in 2022 alone. To enhance the customer experience in online banking, this bank has implemented several initiatives, including two-factor authentication for added security, AI-powered chatbots for customer support, and cashless payment options for local travel. These advancements demonstrate the Maldivian banking sector’s commitment to providing convenient and secure digital financial services to its customers.

Pillar 2: Gaming and OTT fuel digital growth

The digital economy in Maldives is experiencing significant growth, driven in large part by the increasing popularity of online gaming and over-the-top (OTT) streaming services. The number of gamers in the country has surpassed 85,000, indicating a rapidly growing market. This surge is likely fuelled by the country’s recent hosting of major online tournaments and the rising interest in esports gaming.

On the entertainment side, OTT subscriptions have reached over 140,000 in Maldives. While Netflix remains a dominant player, the arrival of competitors like Disney+, Hulu, and Amazon Prime Video suggests a maturing market with a growing selection of streaming options for consumers.

Pillar 3: Prioritizes Digital Transformation in Tourism Industry

The Maldivian government has acknowledged the critical role played by tourism in the country’s economy, contributing to 22% of the overall GDP. In 2022, tourism receipts reached $4.5 billion, with a growth of 28% year-over-year. To achieve a target of $6 billion in tourism revenue within the next few years, the government is focusing on accelerating a 360-degree digital transformation. This digitalization push includes several key initiatives.

Firstly, the government aims to ensure widespread availability of high-speed fibre optic internet across all island communities. This improved connectivity will provide a strong foundation for digitalization efforts. Additionally, a key strategy involves expanding the adoption of digital payment methods for visitor transactions across businesses in the Maldives. This will streamline the payment process for tourists and contribute to a more cashless economy.

Furthermore, the Maldivian government is fostering the development and implementation of mobile-optimized applications and platforms to enhance the visitor experience within resorts. By leveraging mobile technology, tourists can access information, make reservations, and personalize their stay more conveniently. Recognizing the importance of small and medium-sized enterprises (SMEs) within the tourism sector, the government is also empowering them to leverage digital tools for improved business operations. This may involve training programs or providing resources to help SMEs adopt digital marketing strategies and online booking systems.

Finally, the digitalization plan emphasizes the user experience by aiming to develop smart regulatory and management platforms. These platforms can streamline processes for tourists, improve communication with authorities, and create a more efficient overall tourism experience.

Pillar 4: Bringing Access to Education in the Remote Areas

The Maldives government is taking significant steps to bring education to remote island communities. Currently, over 70% of the 360+ schools and colleges across the 200 islands are using smart devices for teaching purposes. This indicates a growing focus on integrating technology into the education system.

To further improve accessibility, the Ministry of Education launched the online platform Filaa. This platform serves as a central repository for various learning resources, including videos of previously televised lessons and digital materials produced by the National Institute of Education. Students across the Maldives now have access to a wider range of educational materials.

In 2022, the Ministry took a pioneering step by introducing satellite education in three remote islands with limited educational facilities. These islands are now equipped with cutting-edge technology, such as Chromebooks and high-speed internet, providing students with access to modern learning tools.

Moreover, more than 40 schools have adopted the Hologo digital education application. This innovative platform offers both teachers and students access to a collection of digital resources specifically designed to improve learning outcomes. The app’s features include augmented reality capabilities and a website with a 3D lesson player, creating a more engaging learning experience.

The Ministry of Education’s commitment to online learning is further highlighted by its Google Certified Educators program. Over 45% of the Maldives’ 11,000+ teachers have completed this training program, equipping them with the skills to deliver effective online lessons using various G Suite for Education applications. This initiative ensures a qualified teaching force prepared to leverage technology for remote learning.

These combined efforts demonstrate the Maldives’ proactive approach to bridging the educational gap in remote areas. By harnessing technology and innovative learning platforms, the government is working to ensure all students, regardless of location, have access to quality education.

Pillar 5: Government is estimated to spend USD 34 mil in ICT to support their digitization and digitalization initiatives

The Maldives government recognized the importance of digital technologies for national development and formulated a strategic action plan (2019-2023) to capitalize on this opportunity. This plan outlined a five-pronged approach to foster a digital Maldives:

• Modernize the governance mechanism of ICT sector
• Establish digital infrastructure
• Modernize government services through digitalisation
• Encourage digital innovation and create a conducive environment for businesses
• Develop a digital-ready workforce