Minister of Finance Ibrahim Ameer has stated the Maldives has the capability to pay the state debt and is not at risk of default. He made the remarks on Twitter while refuting claims that the Maldives is at risk of emptying the state reserves and defaulting on its loans.
In a series of tweets, Minister Ameer said the state reserves will recover to pre-COVID-19 levels as the Maldives receives more revenue, adding that there are currently no challenges in repaying the state debt and that the state reserve will be at a good financial status by the end of the year. The minister said the gross and net reserves are also at optimum levels and that the government is monitoring the inflow and outflow of foreign currency in order to take immediate steps when necessary.
Furthermore, Minister Ameer denounced the claim that the Maldives is at risk of default as false and unsubstantiated accusations made to spread disinformation to the public and foreign investors. He said that such claims will affect the financial market and harm the economic prospect of the country, at a time when the globe is in a fragile economic situation.
Additionally, Minister Ameer said that the economy of the Maldives has been steadily improving due to the government’s work to manage the health and economic crisis following the COVID-19 pandemic, as well as due to the work of citizens and businesses. He said the country will be impacted by the rising prices in international commodity markets and that the government is taking immediate measures to mitigate such risks.
Noting the rise in oil prices has increased the subsidies for electricity and fuel, Minister Ameer said the International Islamic Trade Finance Corporation (ITFC) has increased its financing facility to State Trade Organisation (STO) by USD175 million to reduce the impact on state reserves. He further said the government’s aim is to re-evaluate its finances in order to guarantee the continuation of its services and pave the way for a good financial status in the mid-term.