Finance Minister and Minister of Finance and Public Enterprises Hassan Zareer has stressed that expanding green financing is no longer simply an environmental priority but an economic necessity for the Maldives, as climate change poses a direct threat to the country’s economy, development goals and the livelihoods of its people.
Speaking at the Maldives Finance Forum, organised by the Maldives Pension Administration Office under the theme “Green Finance: Sustainable Investment and Financial Security in the Maldives”, Minister Zareer highlighted the importance of mobilising sustainable investments to strengthen the country’s resilience against climate-related challenges.
He noted that the Maldives’ economic wellbeing is closely linked to the health of its natural environment, particularly its oceans and island ecosystems, which underpin major industries such as tourism and fisheries. Protecting these resources, he emphasised, is essential not only for environmental sustainability but also for long-term economic and financial security.
Referring to the three key priorities outlined by President Dr Mohamed Muizzu at COP31 — climate finance, reform of the international financial architecture and practical implementation — the Minister called for greater access to affordable and grant-based climate financing that reflects the unique vulnerabilities and circumstances of Small Island Developing States (SIDS).
He underscored the need for substantial investment in critical sectors, including infrastructure, renewable energy, water security and coastal protection, while stressing that such large-scale transformations cannot be achieved through government resources alone.
Minister Zareer said the Maldives must look beyond government budgets and international grants by attracting private-sector capital and encouraging long-term investments. He described green finance as an important mechanism for directing financial resources towards projects that protect the environment while creating lasting economic value.
He also highlighted the importance of international investment and technical assistance, cautioning that obstructing critical development projects without adequately considering their wider economic benefits could negatively affect the country’s economy. The Government, he said, remains open to responsible investments that generate mutual benefits while maintaining environmental safeguards.
Calling for stronger participation from the financial and business sectors, the Minister urged banks to develop innovative green financial products and businesses to bring forward commercially viable investment proposals. He stressed that the real success of green finance should ultimately be reflected in stronger and more resilient communities, improved infrastructure, reduced reliance on imported fuel and greater financial security for the public.
The importance of sustainable financing is further highlighted by the Maldives’ growing environmental revenue, particularly through Green Tax collections, which provide a dedicated source of funding for environmental protection and infrastructure development.
According to the latest statistics released by the Maldives Inland Revenue Authority (MIRA), the Government collected approximately USD 123.2 million in Green Tax during the first ten months of 2026, representing a 4 per cent increase compared to the USD 116.7 million recorded during the corresponding period last year.
However, October collections registered a slight decline, with revenue amounting to USD 10.1 million compared to USD 11.1 million in October 2025.
Green Tax is levied on tourists staying in the Maldives, with visitors at resorts, safari vessels and hotels charged USD 12 per person per night, while those staying at local guesthouses pay USD 6 per person per night. Children below the age of two are exempt from the tax.
The country's tourism sector currently comprises 185 resorts, 17 hotels, 922 guesthouses and 164 safari vessels, providing a substantial base for Green Tax revenue.
The funds generated through the tax are specifically allocated towards environmental conservation and essential infrastructure projects across the country. These include the development of water and sewerage systems, coastal protection measures, the Clean Environment Project and the expansion of sustainable water supply networks.
With climate change increasingly affecting the economic and environmental security of small island nations, the Maldives faces the challenge of balancing development needs with long-term sustainability. The growing contribution of Green Tax, alongside efforts to attract international and private-sector green investments, highlights the importance of establishing sustainable financing mechanisms to protect the country's natural resources while securing its economic future.
