The Maldives: Leveraging Public Budgets for Coastal Adaptation Projects

The Maldives, an atoll island chain consisting of 1,192 islands in the middle of the Indian Ocean, are at high risk from rising sea-levels with a maximum elevation of 2.4m above mean sea-level. More than 44 per cent of settlements and 70 per cent of all critical infrastructure are located within 100 meters of shoreline, which makes them highly vulnerable to flooding and coastal erosion. Climate change induced sea-level rise will increase extreme levels due to storm surges and swell waves, exposing islands population, infrastructure and livelihood assets to increasing flood risk.

Through social changes, there are high rates of urbanization and migration, additional to the general population growth. The capital, Malé, faces challenges housing one third of the national population of 300,000 people on only 2.3 km2 of land, making it one of the most densely populated cities in the world.
To overcome the population pressure and to respond to increasing threats posed by natural disasters, coastal adaptation in the Maldives is key. Land reclamation presents a great potential for revenue generation that can be used for coastal adaptation.

Indeed, while coastal adaptation is economically beneficial particularly in densely populated urban areas, these opportunities are often not realised due to the high upfront costs and scarce public resources for adaptation. Public actors, the dominant investors in coastal adaptation, currently cover only a fraction of needed coastal adaptation investments globally, and an even smaller share in developing countries (CPI, 2015). Public financing constraints can be overcome by investing in projects integrating coastal adaptation and land reclamation or urban land redevelopment because the public actor can generate revenues through selling or leasing the newly available land (Bisaro et al., 2018). In urban settings, such as Malé in the Maldives, land values are sufficiently high for generating either market or tax revenues to fund coastal adaptation measures.