100 million Dollar Euro bond to rollover

Finance Minister Moosa Zameer has stated that the Euro bond that was to be paid next April will rollover, with plans to pay sukuk in place.

Zameer stated at the Parliament's Budget Committee yesterday that bond rollover work is being done with the United Arab Emirates (UAE). He said that he has also received assurance that it will be done.

The bond is a USD 100 million (MVR 1.5 billion) bond sold to the Abu Dhabi Fund for Development in 2018.

"We at the ministry have all the information regarding the rollover after President Dr. Mohamed Muizzu held a discussion with UAE government officials, with them being approached three months ago and having received confirmations that it will be done," said Minister Zameer.

Zameer went on to say that the results of the last two years of work are very good, with the assurance that April's sukuk will be paid.

Zameer also said that while the USD 350 million needed for the sukuk will be refinanced, the rest of the USD 150 million will be paid through the Sovereign Development Fund (SDF).

Zameer continued by saying that he does not think of the debt taken on by the previous government to be something to be paid back and that he does not think about decreasing the debt.

"A loan of USD 500 million was taken in order to pay back a USD 250 million loan. That is the reality of what happened. There were instances where debt was taken on with office staff being told of the uncertainty whether the debt can be repaid," said Zameer.

Zameer stated that he will move forward while managing debt and looking at economic improvements.

As per next year's state budget, it allocates MVR 12.9 billion for principal repayments and MVR 5.5 billion for interest payments; a total of MVR 18.4 billion, or 29 percent of the overall budget.

The country’s total debt is projected to reach MVR 159 billion in 2026, equivalent to 128 percent of GDP.