The Maldives Monetary Authority (MMA) has reported a decrease in the government’s overdraft balance on its public bank account. At the end of last year, the balance was recorded as MVR 3.9 billion, but by January, it had been reduced with a repayment of MVR 462.2 million. This overdraft, which involves the printing of additional currency to bridge the gap between government revenue and expenditures, can lead to inflation and devaluation of the currency.
In light of this, MMA has expressed its opposition to excessive printing of currency and has requested that the government repay the amount overdrawn. Despite this, parliament has approved an overdraft of up to MVR 4.4 billion by the end of the current year. The money withdrawn in the previous year was converted into long-term bonds without immediate repayment.
Data from MMA’s latest financial statement shows that the government has started making repayments, and has not requested additional funds to be overdrawn. Additionally, the government has invested MVR 8.3 billion in government bonds and MVR 54.6 million in T-bills.
January this year saw a record revenue for the government, driven by a recovery in tourism, with a total of MVR 3.4 billion. As of the end of last year, the state’s debt has surpassed MVR 100 billion, with an estimated MVR 5.5 billion to be spent on debt servicing during the current fiscal year.
