Financial Services for the Fisheries Sector Maldives Case study

Date: February 2011

Authors:

  • John Linton, Author
  • Fareeha Shareef, Co-Author

Summary:

Fishing, processing and marketing of tuna is a traditional activity in the Maldives.

This study has examined two value chains:

–        The pole and line fishery for (mainly) skipjack tuna, destined for the canned or pouched tuna market

–        The line fishery for (mainly) yellow fin tuna destined for the fresh fish markets in Europe and Japan.

Production of fish peaked in 2005/6, with approximately 180,000 tons of fish landed, of which approximately 135,000 was skipjack tuna. This was exclusively caught by Maldivian fishermen, using traditional and modified traditional vessels called Dhonis. Approximately 1,300 of these vessels were registered in 2009.

In 2007 the fishery crashed, with catches declining by nearly 30%. This decline has continued, with reported catches in 2010 being only 88,000 tons – less than 50% of the peak.

Nonetheless, investment during the early 2000’s has resulted in the Maldives having a relatively modern fleet and world class fish processing and marketing facilities. Maldivian fish is exported worldwide.

Initial investments in the fisheries sector was undertaken through development projects financed through loans from organisations such as the World Bank and IFAD. Other development support was also provided.

More recently, investment has been provided through other sources, such as buyer credit, commercial credit, savings and equity. As might be expected, investments have performed poorly in recent years, but investors have so far reacted by rescheduling loans rather than forcing foreclosures.

In spite of recent events, the fisheries sector continues to operate and innovate. In the absence of any unforeseen external shocks, the likelihood is that it will continue to do so. Its development from an artisanal fishery servicing a regional and domestic market to a global player has been aided by a number of factors, four of which are: the traditional role of fishing in Maldivian culture, the development finance and initial innovation generated through development projects, the tourism sector and the enabling environment.

Share