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Maldives’ foreign debt fell by 18 per cent in the second quarter after the Government made its largest-ever quarterly debt repayment, Finance Ministry data shows.
Mariyam Adheela
Finance Ministry
The Maldives’ foreign debt fell by MVR 12.3 billion in the second quarter, following record debt repayments of MVR 15.16 billion during the three-month period, according to debt statistics released by the Ministry of Finance and Public Enterprises.
The Government’s direct and guaranteed foreign debt declined from MVR 67.7 billion at the end of the first quarter to MVR 55.4 billion by the end of the second quarter.
The Government repaid MVR 8.3 billion in foreign direct debt during the quarter, including MVR 7.8 billion in principal and MVR 516.7 million in interest. A further MVR 6.8 billion was used to repay guaranteed foreign debt.
Foreign direct debt fell from MVR 43.2 billion to MVR 36.8 billion during the quarter, while its ratio to GDP declined from 34.8 per cent to 29.6 per cent.
Among the major repayments was the settlement of a USD 500 million sukuk issued by the previous administration. The Government also repaid half of a USD 200 million loan secured through the Indian Government by the previous administration.
Economists said reducing the foreign debt burden could lower the Government’s future demand for foreign exchange and increase the availability of foreign currency in the domestic economy.
