Following the recession under the current administration, President Ibrahim Mohamed Solih’s Finance Minister Ibrahim Ameer has repeatedly pushed to overdraft from the Public Bank Accounts, printing more money to cover recurrent costs of the Government.
On 17th November 2021 the Parliament’s Committee on Public Finance approved for a third time to extend Finance Minister Ibrahim Ameer’s request to overdraft, printing more money into circulation. Under the current extension the Government of Maldives will be able to overdraft from January 2022 till 2023 with a ceiling of MVR 2.5 billion.
He also urged for the Government to take the initiative in securing the projected grants and aid from foreign sources.
Speaking on the subject MP Hussain Mohamed Didi stated that “Continuously printing more money shouldn’t be seen as a solution”. He further stated that he does not support the notion of printing more money while failing to do what needs to be done. He also noted that the projected revenue for 2022 was earmarked as MVR 21 billion and that estimated state expenditure was marked as MVR 24 billion, stating that the Government needs to revise the state budget.
“Without any revenue source if we print more money than inflation will rise. We need another way” said MP Hussain Mohamed Didi while speaking on the subject.
Since last April the Government has printed at least over MVR 4 billion, leading to a significant inflation in the prices of goods and services. While the US Dollar exchange rates are still pegged at MVR 15.42 by the central bank, the real price of U.S. Dollar is now much higher in the black market, going north of MVR 23.