Minister of Finance Ibrahim Ameer has revealed the government will announce the policy changes to be made to fuel subsidies in September. He made the statement in an interview with PSM News following the India-Maldives Business Forum held in New Delhi during President Ibrahim Mohamed Solih’s official visit to India.
In the interview, Minister Ameer noted that fuel prices are being maintained in the Maldives despite the rise in prices in the global market. The minister said the Maldives can shield its citizens from the price hike with subsidies, unlike other countries. He, however, questioned whether the current policies on providing fuel subsidies in the country are fair, as discounts are provided at the same rate for the wealthy and those most in need of fuel. He said currently the state provides fuel subsidies to parties that are not in need of it and that the policies need to be changed to pave the way for better fund management that will also benefit the public. He added the government will provide details on the changes next month.
In a televised address to the nation in July, President Ibrahim Mohamed Solih revealed the government will soon change the policies on fuel subsidies in order to benefit the citizens most in need of the subsidies. President Solih said the government decided to make the changes in response to changes in the economy. He said the economic effects of the COVID-19 pandemic and the Russia-Ukraine war are visible in the Maldives. He noted that Maldivians had not incurred the full brunt of these increases due to government intervention while global prices for goods and fuel had risen significantly. He went on to say that the government's primary responsibility is to absorb the effects of similar hardships experienced around the world while minimising any harm to its citizens.
Additionally, President Solih said the economy of the Maldives will return to pre-pandemic levels this year but there are immediate challenges to be solved in order for all Maldivians to benefit. He said the government has deemed it necessary to make policy changes to keep providing essential public services while maintaining the current economic development. He detailed that the work includes reducing recurrent state expenditure, delaying upcoming government projects, and increasing state revenue.