Chapter 4 | Page 176 4.4.2 Pushing policy boundaries on resource mobilisation: A case study on Maldives The previous section outlined the range of challenges States face in fiscal policy design and implementation, particularly in relation to maximising domestic public sector resources. The following case study analyses some of these key challenges in more depth. It shows that proper design and implementation of a robust fiscal policy can be particularly challenging for small developing countries.170 While the issues and challenges may not be applicable to other countries, they illustrate the complexity of revenue policies and their implementation.171 4.4.2.1 Economic background and fiscal position The Indian Ocean tsunami of 2004 and the global financial and economic crises of 2007-2008 affected Maldives particularly badly, especially given its small size and inherent vulnerability to external shock.172 According to the World Bank, macroeconomic imbalances threaten to derail the government's development agenda, especially since the policy response to the 2007-2008 global financial crisis was partial and has left the country vulnerable to further shocks.173 These macroeconomic imbalances, especially fiscal deficit, and the general level of policy uncertainty continues to threaten the already narrow economic base. For public revenue, the Government of Maldives relies heavily on tourismrelated taxes and rents. Tourism revenue has been traditionally based on a 170 As described in chapter 1, Maldives is selected for case studies throughout this thesis based on the relevance of the country’s experience to small developing states, easy availability of relevant data, and the author’s personal familiarity with the country. 171 A detailed background on the socio-economic condition and human rights situation in Maldives is covered in Chapter 1 (Section 1.4.3.1). 172 See for example, Ministry of Planning and National Development, Tsunami Impact Assessment 2005: A socio-economic countrywide assessment at household level, six months after the tsunami (Ministry of Planning and National Development, Male', Maldives, 2005), <http://www.planning.gov.mv/publications/TIA/TIA_SUMMARY_ report.pdf>; The World Bank, Maldives: Country Snapshot (The World Bank, Washington, D.C., 2014). 173 The World Bank, Maldives Overview <http://www.worldbank.org/en/country /maldives/overview>.