China finalizes Maldives debt relief arrangements

The Maldives and China have fully finalized debt relief arrangements, according to Kong Xianhu, Beijing’s top diplomat in Male’.

Maldives and China have been engaged in months-long negotiations regarding reaching an agreement on debt relief.

During a reception hosted by the Chinese embassy at the the Barceló Nasandhura Male’ on Tuesday night to mark China’s 76th National Day, Kong announced that the two countries have now come to an agreement.

“Here, I’m glad to announce that debt relief arrangements between concerned parties of our two sides have been fully finalized,” he said.

However, he did not disclose any details regarding the deal.

Kong said the arrangement indicates “not only Chinese government’s strong support to the fiscal and financial stability of the Maldives but also our confidence in the reforms undertaken by the Maldivian government and the great potential of Maldivian economy.”

China is a key developmental partner for the Maldives as well as one of the island nation’s biggest lenders.

Major infrastructure projects run in the Maldives with support from China includes the construction of the Sinamale’ Bridge, which links Male’ City with Hulhumale’ and Hulhule’, where the Velana International Airport is located.

The Maldives is currently running three major projects with grant aid from China – a project to develop a hospital in Vilimale’, a project to redevelop the roads of Male’ and Vilimale’, and a project to construct council buildings in 50 islands across the country.

Kong’s announcement comes as Maldives struggles under the weight of staggering external debt obligations, which now stands at 134 percent of the country’s GDP.

The country has a USD 500 million debt repayment due this year, and a staggering USD 1.1 billion due in mid-2026.

It is unclear how much of this is owed to China.