The Maldives (a small island nation in the Indian Ocean heavily reliant on tourism and imports) is grappling with a severe shortage of U.S. dollars, with foreign reserves currently covering only around six weeks of imports — well below the three-month buffer recommended by the IMF. The crunch stems from a heavy external debt burden, with $1.7 billion due in 2026 alone, and has been worsened by a sharp drop in tourist arrivals and recent large repayments, including a $500 million Islamic bond and a $400 million currency swap with India. The crisis is now becoming a defining political liability for President Mohamed Muizzu, who faces criticism from both the main opposition Maldivian Democratic Party and former ally ex-President Abdulla Yameen, as the country looks ahead to a presidential election in 2028.