Question

Maldives announced its bankruptcy at the International Monetary Fund because of a loan default.

Answer 1

This claim is not true. The Maldives is a collection of islands off of the Southern tip of India. Like many other countries, it was impacted by the COVID-19 pandemic and the economy took a hit because tourism was a big contributor. The country is also highly vulnerable to climate change which in the coming years could also impact the economy. While the country is not bankrupt, it has significant debt to China. Voice of America says that the “Maldives owes China $1.37 billion, adding up to about 40% of the country’s public debt” (Voice of America). The International Monetary Fund (IMF) had a whole press release about the Maldives after visiting the country from January 23 to February 6th, 2024, to assess economic developments. They recommended “A sustained fiscal consolidation, accompanied by tighter monetary and macroprudential policies, is needed to reduce vulnerabilities and restore the sustainability of public finance and debt” (IMF). Various news media in India reported on the IMF’s warning of the Maldives having a high risk of debt distress including The Hindu, Hindustan Times, and PTC News. So, the Maldives is not bankrupt but could possibly be in the future if they do not enact policies to alleviate their debts to other countries. 

The account who posted this is @themythvsfact and based on their bio their posts are about “Separating fact from fiction. Unique content. Myth and facts.” They post a wide range of content. Most are weird facts like “Watermelon seeds have one of the highest nutritional content of any seeds” or “Rat arrested for drinking 60 bottles of seized liquor at a police station.” I think the content is posted purely for views, likes or overall engagement. They seem to have no real credibility on any topic or news.   

Myth vs. Fact Instagram: https://www.instagram.com/themythvsfact/ 

IMF: https://www.imf.org/en/News/Articles/2024/02/06/pr2440-maldives-imf-staff-completes-2024-article-iv-mission 

Voice of America: https://www.voanews.com/a/imf-flags-bri-partner-maldives-high-debt/7480862.html 

Hindustan Times: https://www.hindustantimes.com/world-news/maldives-sitting-on-a-debt-pile-not-bankrupt-as-of-now-101708329376819.html 

The Hindu: https://www.thehindu.com/news/international/imf-warns-of-maldives-foreign-debt-crisis-after-china-borrowing/article67821241.ece 

PTC News: https://www.ptcnews.tv/world-news/maldives-faces-mounting-debt-but-not-bankrupt-yet-3851236 

Comments

This is an excellent fact-check. Not only did you prove the claim to be false, but you also provided helpful context as to why the rumors are circulating. I also enjoyed how many sources you linked; it helps add legitimacy to your claim.

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This is an amazing fact-check. You were able to provide articles debunking the claims and research behind the poster itself. This is very well researched and thought out, especially on a topic people might not fact check 100% themselves. Great job!

Answer 2

As of two days ago, the Maldives is not yet bankrupt, although they are facing intense debt. They owe other nations upwards of 4 billion USD and have a mountain of internal debt as well. But as of now, there is nothing that suggests they are bankrupt.

Comments

I am confused by your lack of sources. Where did you get this information? Without that, your fact check is no more credible than the original claim. On the topic of the original claim, I think your response could benefit from looking into the account that posted this image; is there an agenda here? Did they make up this claim, or are they circulating information from another source? This information can help us understand why this claim exists, how far it has circulated, any intentions behind it, and what we might look out for in the future. I hope this advice can be helpful for future responses!

Answer 3

The Maldives is currently not bankrupt, despite its large debt issue. The country's gross national income is USD 5.6 billion, according to Hindustan Times. The Maldives President mentioned that the government is unable to launch new development projects due to poor financial conditions, indicating a challenging economic situation according to a post on LinkedIn. While reports are suggesting that the Maldives has declared bankruptcy to the IMF and requested a bailout, these claims are not confirmed, and the country has not officially declared bankruptcy.

https://www.hindustantimes.com/world-news/maldives-sitting-on-a-debt-pile-not-bankrupt-as-of-now-101708329376819.html

https://www.linkedin.com/pulse/maldives-verge-bankruptcy-prodotgroup-yzn5c/?trk=article-ssr-frontend-pulse_more-articles_related-content-card