President Dr. Mohamed Muizzu, speaking at a side event on the sidelines of the 79th United Nations General Assembly (UNGA), called for immediate and collective action to address the growing debt crisis faced by Small Island Developing States (SIDS). The event, titled “Building Resilient Futures: The SIDS Debt Sustainability Support Service,” marked one of the first engagements for President Muizzu during his visit to New York.
Addressing a distinguished audience, including Prime Minister Gaston Browne of Antigua and Barbuda, President Muizzu emphasized the critical need to tackle debt challenges head-on, stating that over 40 percent of SIDS are either already in, or approaching, debt distress. He pointed out that the Maldives, like many other island nations, is struggling with a debt-to-GDP ratio exceeding 100 percent, making sustainable development an uphill battle.
“This stark reality demands urgent action,” Dr. Muizzu stressed, highlighting the SIDS Debt Sustainability Support Service (DSSS) as a pivotal initiative designed to address the crisis. Launched earlier this year at the SIDS4 conference, the DSSS provides a comprehensive and sustainable approach to managing debt while creating fiscal space to invest in climate adaptation and sustainable development.
The President called for solidarity among international partners, emphasizing that while sustainable debt management is critical, it is not enough on its own to secure the future of SIDS. He urged leaders to focus on diversifying economies, which are often narrowly based on sectors such as tourism and fisheries, leaving them highly vulnerable to external shocks.
“The Maldives experienced one of the sharpest GDP declines in the world during the COVID-19 pandemic,” Dr. Muizzu noted, underscoring the urgent need for economic diversification. He added that SIDS must strengthen their productive capacities and build resilience to withstand future global economic challenges.
The President also announced his participation in a side event to advance the Antigua and Barbuda Agenda for SIDS (ABAS), inviting attendees to engage in discussions on economic diversification, sustainable infrastructure, and resilient growth in SIDS economies.
In his speech, Dr. Muizzu called for stronger links between debt relief and climate finance, advocating for meaningful debt relief mechanisms such as lower interest rates, extended repayment terms, or restructuring. He also proposed the strategic use of Special Drawing Rights (SDRs) through international financial institutions to support SIDS’ debt sustainability efforts.
President Muizzu highlighted innovative financial tools such as blue and green bonds, debt-for-nature swaps, and concessional financing as essential components of a resilient economic strategy for SIDS. These mechanisms, he said, could help reduce investment risks, open new sectors for growth, and build the sustainable futures that SIDS envision.
While external solutions are important, the President emphasized that SIDS must take ownership of their development journey. “We must build robust institutions, enhance our productive capacities, and empower our communities to lead this transformation,” he said.
Concluding his speech, President Muizzu called on governments, the private sector, and the international community to work together to ensure that the DSSS becomes a catalyst for transformational change. By creating the fiscal space needed for sustainable growth and fostering innovation, he expressed hope that SIDS could move from merely surviving to thriving on the global stage.
President Dr. Muizzu is in New York to attend the UN General Assembly, where he is scheduled to participate in several high-level meetings and events, including a special open debate at the UN Security Council. His visit marks his first appearance at the UN since taking office in November last year.
