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  • Writer's pictureBait Al-Amanah

The Maldivian Connection: A Story of Microstates and Malaysia

Written by Yugendran T Kannu Sivakumaran, Research Assistant (Economics and Public Policy) of Bait Al Amanah.

When you think about Malaysian trading partners, what comes to your mind first? You may have thought about the big shots—countries like the United States and the United Kingdom—or even a powerhouse of a city-state called Singapore. Nevertheless, the focus will be on a microstate that is everyone's dream holiday getaway: the Maldives.


A microstate, in simple terms, is a very small country, and the Maldives more than meets those criteria. In fact, it can even be considered a nano-state, a term coined by His Excellency Ali Hussain Didi, the honourable High Commissioner of Maldives to Malaysia, in an interview with Bait Al Amanah. A notable fact is that the Maldives is the smallest country in Asia, spanning only a small area of 90,000 square kilometres, of which only 298 square kilometres is dry land. In comparison, the total land area of Singapore is 719 square kilometres.


Now, you may feel that such a small country would not have much significance to Malaysia. For example, in 2021, the total trade between Malaysia and the Maldives was only RM504 million. That may be a valid point, but in 2022 alone, trade doubled, reaching a total of RM1.01 billion. The further signing of the DTAA Act between Malaysia and the Maldives is expected to skyrocket this already impressive increase. In the interview with His Excellency, he strongly stated that Malaysia and the Maldives have barely touched 20% of their potential as trade partners and are slowly building up the stepping stones to reach their untapped potential.


In order to reach this potential, one of the measures placed, other than the DTAA, is that His Excellency, during his tenure, has increased the number of flights from both countries from just 6 a week to 16 and plans to increase it to 30 in the next couple of years. This is meant to increase the traffic of tourism between both countries, as the increase in flights will drop the travel costs.


Furthermore, Malaysia is a hotspot for education tourism for many Maldivians due to the quality of our private education system, the affordability compared to other countries, and the services provided by Education Malaysia Global Services (EMGS) which makes the process of transitioning to Malaysian higher learning institutions simple. A report by The Star found that there are 2000 Maldivians studying in Malaysia and this number may increase as the Malaysian envoy to the Maldives, Badli Hisham, is working with the International Study Abroad Education Expo to promote Malaysia as an education hotspot for more Maldivians. This is highly beneficial for our educational tourism industry and even for our higher learning institutions as they enrol more students. In addition to that, Maldivians who pursue their higher education in Malaysia are highly beneficial for the job force, as they can help Malaysia in its skilled labour category and reduce the impact of brain drain.


However, Maldivians in Malaysia are facing certain issues that can drive newcomers away. In the interview with His Excellency, it was found that Maldivians find it hard to procure jobs and internships in Malaysia when they graduate. This may drive Maldivians to go to other countries instead. One of the biggest hurdles for international students is the requirements for an employment pass. In order to receive an employment pass in Malaysia for a bachelor’s you need a minimum work experience of 3 years which fresh grads do not have. Furthermore, the minimum salary requirement is RM 3,000 which employers may find a bit high for workers with very little experience. Due to these restrictions, many international students have no choice but to leave the country and if we do not do anything about this we will lose valuable skilled human capital. However, with the recent initiative in the Budget 2024 bill this may soon change as the government plans to loosen some of the red tape that hinders this, such as introducing a long term visa pass that can help skilled international students who graduate enter the Malaysian job market.


Additionally, the Maldives can teach Malaysia in various ways, such as marine conservation and preserving coral ecosystems. With the increase in ocean temperatures, Malaysian corals are under threat as the warmer waters are making them bleach. Furthermore overfishing and climate change has led to a massive decline in Malaysia’s marine life. The Maldives have championed coral conservation by creating coral nurseries. These coral nurseries are made by spreading out coral and attaching them to metal frames, with the corals being spread out they recover and grow much more quickly and this can be used to help repopulate areas in which corals have died out. In addition to that, Maldives fights against overfishing by not allowing trawlers or huge nets that can destroy the reef bed. Instead, they use the pole and line method which prevents large-scale damage. By following in the Maldives footsteps we can make sure that we Malaysians can protect our local ocean’s diversity.


As Malaysia focuses on globalisation, it is important that we do not just focus on working with major countries. It is time for us to work more with smaller countries such as the Maldives and other microstates, as the potential for both sides is massive. Furthermore, it is crucial for Malaysian lawmakers to help citizens of smaller countries, especially those from microstates, transition into Malaysia. As if we do not, we will lose out to other countries that may take advantage of these opportunities before we do.


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