Auditor General’s Office (AGO) confirms Maldives government required MVR30.5 billion to repay state debt in the next four years.
AGO said their research confirms the need for a long-term plan for debt repayment. The office made the remarks at the budget research committee at Maldives Parliament. The office further notes 2025 and 2026 as the highest debt repayment years.
The government is looking to repay MVR5.5 billion in 2023, and MVR6.4 billion in 2024. Moreover, statistics note government expects to pay MVR8.9 billion and MVR9 billion in debts for the years 2025 and 2026, respectively. AGO also notes the repayment in 2026 is by far the highest amount in the past 10 years the country will be spending to clear its state debt.
“A large portion of this has to be paid as foreign debt. This requires long-term plans to mitigate refinancing based on interest rates and foreign market risks,” Mohamed Shaan, the Director of AGO said.
Maldives government estimates its state debt will reach MVR113.6 billion by the end of 2023. This is 108% of the country’s Gross Domestic Product (GDP).
As Maldives government aims to repay its debt at comparatively higher thresholds in the next four years, state will achieve this through Sovereign Development Fund (SDF). Maldives Monetary Authority (MMA) urged the government to expedite the approval of legislation to restrict spending from SDF on non-debt repayment related purposes.