President Dr. Mohamed Muizzu has emphasised that the future of Small Island Developing States (SIDS) hinges on their ability to harness human capital, promote entrepreneurship, and implement homegrown solutions that reflect the unique strengths of island nations. He reiterated the call for collaborative efforts towards a transformational future where SIDS not only survive but thrive.
In his remarks at a side event on "Building Resilient Futures: The SIDS Debt Sustainability Support Service,", President Muizzu addressed the longstanding challenges of debt sustainability that SIDS face. He highlighted that these issues are deeply rooted and intertwined with the economic vulnerabilities that have affected small nations for years. Noting that the Maldives and many other island nations have debt-to-GDP ratios exceeding 100 percent, he called for urgent action, citing that over 40 percent of SIDS are already in or nearing debt distress.
The President underscored the importance of the SIDS Debt Sustainability Support Service (DSSS), launched in May, which aims to provide a holistic and sustainable approach to managing debt. However, he emphasized that finding a way to break free from the debt trap remains critical. He pointed out that while sustainable debt management is essential, it alone is insufficient to secure the future of Small Island Developing Nations.
President Muizzu urged SIDS leaders to spearhead efforts to diversify their economies and strengthen productive capacities. He noted that reliance on narrow economic bases, often dominated by tourism or fisheries, renders these nations highly vulnerable to external shocks. Diversification, he asserted, is not merely a goal but a necessity for survival in an increasingly volatile global economy.
The President also highlighted the need to strengthen the link between debt relief and climate finance. He reiterated the importance of aligning climate adaptation finance with debt relief, stressing that the DSSS should focus on advocating for meaningful debt relief through lower interest rates, extended repayment terms, or restructuring to alleviate the burden.
He concluded his remarks by emphasising that external solutions alone are inadequate to address these challenges. SIDS must take full ownership of their development journeys, empowering one another, building robust institutions, and enhancing productive capacities to lead this transformation.
President Muizzu affirmed that the future of SIDS relies on their ability to cultivate human capital, promote entrepreneurship, and adopt solutions that are uniquely tailored to their contexts. He called for unity and collaboration to ensure a future where SIDS are not merely surviving, but thriving.