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Decision to stop printing money and positive impact of cost reduction can be observed: MMA

The decision made by the government to stop printing money has lead to a significant cost reduction, according to MMA. It has improved the fiscal and economic conditions of the Maldives.

Uzma Naseem
28 March 2024, MVT 19:33
Uzma Naseem
28 March 2024, MVT 19:33

Maldives Monetary Authority (MMA) on Wednesday stated that the current government’s decision to stop printing money has yielded a positive impact on the fiscal and economic conditions of the Maldives.

Briefing the Finance Committee of the Parliament on the cash flow yesterday, Deputy Governor Ahmed Imad stated that the economy grew at 5.4 percent this year and the revenue for the first three months surpassed expectations.

“The revenue in free aid stands at MVR 33.5 billion. As of March 14, MVR 7.2 billion has been received. Hence, the revenue is very much inline”, Imad said.

He also said the government’s recurrent expenditure has been significantly reduced.

“Statistics show that the recurring and capital expenditure has been low so far in March. We had capital expenditure at MVR 3.2 billion in 2023”, he said. “However, it is now at MVR 1.5 billion”.

Imad further stated that when comparing recurrent and capital expenditure to the previous year, there was a contraction of MVR 2 billion.

To manage cash flows, Imad emphasized that the borrowing rate from the domestic market has also significantly decreased. In the last three months, the number of bonds and treasury bills (T-bills) sold within the country amounted to MVR 175 million.

Responding to questions from members of Parliament, Imad said that in the last three months, the gross reserves stood at [approximately] USD 580 million in accordance with MMA regulations.

He believes that by the end of the year, the figure will be maintained at around USD 600 million.

Responding to a question by a member of Parliament regarding the government’s alleged agreement to an International Monetary Fund (IMF) package, Imad stated that he had not received any official information about such a decision.