Driven by a rebound in tourism, Maldives’ economy continued to recover strongly in 2022, and poverty is expected to have fallen below pre-pandemic levels by end-2022. The number of tourist arrivals grew by 26.7 percent (y-o-y) to 1.68 million in 2022, only 1.6 percent lower than the pre-pandemic level (Figure ES. 1). Despite Russia’s invasion of Ukraine, a rebound in arrivals from key European markets, and growing interest from Russia, India and Middle Eastern countries have offset the absence of Chinese tourists. As a result, the Maldivian economy is estimated to have grown by 12.3 percent in 2022. Poverty levels also fell with the strong economic rebound, but high informality in labour markets remains a real concern, given the impact this might have on further increasing inequality in the country, especially in the outer atolls (Figure ES. 2).