State overdraws MVR 8.2 Billion in three years

It has been revealed that the state has overdrawn MVR 8.2 billion in the past three years.

Data from the Central Bank, Maldives Monetary Authority (MMA), shows that the number of "net claims" or overdraws in 2020 stood at MVR 6.1 billion. However, by October this year, it had increased to MVR 14.3 billion.

From 2020, the government has set a limit for printing up to MVR 4.4 billion from public bank accounts (PBA). Withdrawals up to the limit by the end of this year have been approved by the parliament.

According to official figures released by the MMA, MVR 1.7 billion had been printed as of October last year. The figure is inclusive of the previously printed MVR 6.5 billion which had been converted into bonds. Earlier this year, the government printed MVR 4.2 billion and converted it into bonds as well.

Printing more money to meet government expenditures will increase the money in circulation in the economy, increase the demand for foreign currency, and adversely affect the country's exchange rate.