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Eva Abdulla

October 14th, 2024

Debt’s Gendered Impact and a Feminist Foreign Policy for Maldives’ Debt Negotiations

0 comments | 14 shares

Estimated reading time: 10 minutes

Eva Abdulla

October 14th, 2024

Debt’s Gendered Impact and a Feminist Foreign Policy for Maldives’ Debt Negotiations

0 comments | 14 shares

Estimated reading time: 10 minutes

As countries in the Global South cope with financial stress and some struggle with serious financial crises leading to reliance on IMF recovery programs, how can nations work towards a more gender-sensitive and economically inclusive recovery? Eva Abdulla discusses this in the context of the Maldives, arguing for a gender-sensitised foreign policy and debt recovery policy as the bedrock for a better society. 

 

A country’s ability to determine its own future is inexorably linked to the who, what, why, when and how of public debt — who holds it, what it funds, why it was incurred, when and just how it must be repaid. Managing public debt is not just a financial challenge — it is as much a story of survival. This struggle plays out at every level in the Global South: nations work to preserve their autonomy, governments fight to maintain stability, communities strive to retain essential services, and individuals battle to make ends meet. Eighty-five per cent of the world population, suffering from crippling public debt, is currently surviving under austerity measures.

Public debt disproportionately impacts women. Debt-burdened Maldives exemplifies the need for a foreign policy approach in debt negotiations that centres individual lives, women and communities.

Debt and Foreign Policy

Over the last decade, the Maldives’ foreign policy has been volatile, oscillating between ‘India-first’ and ‘India-out’ stances. Each pivot away from India led to increased Chinese involvement, and the Maldives has accrued substantial debt, creating a ‘debt trap’. With external debt servicing expected to exceed US$1bn in 2026 and growing uncertainty about the government’s ability to refinance its debt, the Maldives finds itself in a severe economic crisis.

Consequently, debt management has become our foremost foreign policy priority.

Public Debt and Foreign Policy are Women’s Issues

This post examines a critical nexus: Maldives’ public debt crisis, its foreign policy responses and the consequent impact on women.

This interconnected relationship is underpinned by four key points:

  • The burden of public debt disproportionately affects women.
  • Public debt management strategies must consider their impact on women.
  • A nation’s debt profile fundamentally shapes its foreign policy agenda.
  • Consequently, foreign policy formulation demands gendered analysis to account for its far-reaching effects on women.

The IMF and Austerity Measures

Traditional debt sustainability strategies, consisting primarily of austerity measures, focus on a country’s ability to repay its debts. These measures, therefore, fail to account for the lived realities of individuals and communities. This narrow focus on debt repayment comes at a significant human cost: such approaches largely overlook gender-specific impacts, compromising a country’s ability to meet its human rights obligations and long-term development goals.

The scale is staggering. In 2021, developing nations spent over US$400 billion repaying debts, more than twice the amount they received in official development assistance. This stark disparity highlights the potential conflict between debt-servicing and human development priorities, including sustainable development goals.

The scorecard of IMF restructuring programmes is disquieting: how austerity measures stultify economies, and how much the institution continues to fail one indebted country after another is well documented and well-experienced by nearly all countries in the Global South.

The recent Presidential elections in Sri Lanka serve as a stark reminder. Still grappling with their worst financial crisis in decades, they understood their government’s need to enrol in an IMF debt-restructuring programme. However, the widespread rejection of the impact the IMF-imposed austerity measures on their own lives and livelihoods was evident soon. The ballot essentially became a referendum on these measures, with victory going to the candidate promising to renegotiate them.

In 2022, the IMF adopted a ‘gender strategy’. However, this too is insufficient in addressing the impact on women in debtor countries.

Gendered Impact of Austerity Measures in the Maldives

Whether the government acknowledges it or not, the Maldives is facing some form of debt restructuring programme and austerity measures. The gendered impact of austerity measures in the Maldives is expected to manifest in several ways:

  • Decline in public services: With systematic reductions in the quantity and quality of public services and infrastructure, women and other vulnerable groups will feel the impact most acutely.
  • Cuts in social protection programmes: Women will bear the brunt of cuts in single mothers’ allowances, pensions for the disabled and elderly, subsidies for food, electricity, healthcare, and education. (Women in the Maldives benefit disproportionately from social welfare programme, making cuts particularly devastatting for them.)
  • Public sector job cuts: These will further burden women.
  • Reduced investments: Cuts in economic empowerment programmes will diminish opportunities for advancement.
  • Unpaid care work: In the Maldives, women shoulder a disproportionate share of unpaid care and domestic work. Maldivian women spend an average of 19 hours out of a 24-hour day on these tasks, more than double the 8.1 hours spent by men. This disparity limits women’s ability to participate in the formal economy and perpetuates deep-rooted gender inequalities.
  • Informal sector confinement: With limited time for formal employment or skill development, many women find themselves confined to the informal sector or completely excluded from the labour market. Cuts across multiple fronts are likely to worsen this situation.

When a government is firefighting, there is diminishing investment in long-term development goals such as women’s equality, rights and well-being.

A Feminist Foreign Policy Approach to Public Debt Sustainability

A feminist foreign policy approach to public debt sustainability aims to reshape debt management narratives by bringing human rights to the forefront, prioritising individuals’ lived realities and advocate for long-term sustainable goals rather than repayment at any cost. This strategy, which the Maldives could leverage in creditor dialogues, offers an alternative to traditional debt management strategies that have failed to account for human and gendered impacts.

Gender-responsive policies form the core of this approach, incorporating gender-disaggregated data in debt analysis, gender impact assessments and tax tweaks that do not disproportionately burden women. It emphasises safeguarding social protection programmes benefiting women including debt relief conditions that prioritise women’s economic opportunities and integrating gender-budgeting into national debt management strategies.

The approach adopts an intersectional perspective, ensuring aid programmes address diverse needs of Maldivian women across socio-economic backgrounds. It incorporates gender equality benchmarks in aid conditionality and implements gender-sensitive monitoring and evaluation frameworks. Capacity-building is integral, providing technical assistance on gender-inclusive debt management and supporting women’s organisations in aid planning and implementation.

Women, Climate Change Good Governance in Debt Sustainability

Climate change is the ‘inequality multiplier’, exacerbating existing disparities particularly in the Global South and especially in a frontline state like the Maldives. As adaptation measures compete with debt repayment for limited resources, women bear a disproportionate burden of climate-related stresses. Therefore, Maldives’ foreign policy interventions in debt management must simultaneously address the specific impacts of climate change and the disproportionate burden these factors impose on women.

Good governance is crucial in building back better, whether from a tsunami, COVID or financial crises. It requires transparency, accountability, oversight and engagement of all communities throughout the debt management process, and the building back negotiations and roadmap must advocate for good governance, which is only achieved with equal participation and consideration of policies’ impact on women.

Conclusion

The disproportionate burden of public debt on women creates far-reaching, generational consequences. Addressing this demands solutions that respond to women’s unique challenges and potential.

A feminist foreign policy offers an opportunity to mitigate this imbalance. By strategically leveraging aid relationships, it elevates the rights and needs of individuals, women and communities in international discourse and action.

As the Maldives crafts its debt management strategy within its broader foreign policy, it must integrate a feminist lens in both creditor negotiations and policy implementation. The nation should prioritise policies that protect and empower women, aiming to reduce existing inequalities rather than reinforcing them.

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The views expressed here are those of the author and do not represent the views of the ‘South Asia @ LSE’ blog, the LSE South Asia Centre or the London School of Economics and Political Science. Please click here for our Comments Policy.

This blogpost may not be reposted by anyone without prior written consent of LSE South Asia Centre; please e-mail southasia@lse.ac.uk for permission.

Banner image © Saffu, Addu City, Maldives, 2018, Unsplash.

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About the author

Eva Abdulla

Eva Abdulla is Chair of The Maldives Policy Think Tank, former Deputy Speaker of the Maldives (2019–23), and a three-term elected member of the Parliament of Maldives; she has a Masters degree in Politics and International Relations from the University of Warwick, UK.

Posted In: Maldives

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