The Edition


Our debt to China is far lower than 3.2 billion dollars: Minister Saeed

12 November 2018, MVT 17:21
Economic Minister, Mohamed Saeed at a PPM Campaign rally at Rumaalu 2 campaign hub. PHOTO: AHMED HAMDHOON/MIHAARU
12 November 2018, MVT 17:21

The government released a statement on Monday, denouncing former President Mohamed Nasheed's estimate of the nation's USD 3.2 billion debt owed to the Chinese government as a false denomination.

In a statement given to local news 'Mihaaru', Economic Minister Mohamed Saeed responded to Nasheed's claim by attesting that the government debt to China is far below 3.2 billion dollars, assuring that figures pertaining to the debt to China will be released soon.

Although this is the last week in-office for the incumbent government, statements regarding the current position of the national debt are yet to be released.

“We have acquired the loans at an interest rate of 2%. It is no longer possible to get loans at such rates today. These are loans with long-term payment plans,” said Saeed, who led negotiations for the Chinese-backed projects.

“There is no loan which should worry the Maldives”, claimed Saeed.

Insisting that the loans given by the Chinese should be repaid solely from revenue generated by the government, former President Nasheed demanded that Maldives settle payments via timely instalments deemed feasible per state revenue.

Minister Saeed classed Nasheed's claims of the high government debt incurred over China-funded projects undertaken in the Maldives as wrongful accusations made against the government, adding that the projects that were carried out had met all of the international standards.

During President Yameen's administration, the Chinese government aided the Maldivian government in the undertaking of major projects such as ‘Sina-Male’ Bridge’, the expansion of Velana International Airport and several housing projects across the Maldives.

The ‘Sina-Male Bridge’, constructed by the China Communication and Construction Company (CCCC) cost the Maldivian government USD 200 million, of which USD 116 million was given as ‘free aid’.

Overall, USD 72 million was given as a loan by the Chinese government in order to complete the project. The Maldivian government, on the other hand, spent USD 12 million from its budget on the building of the bridge.

The Chinese firm, Bridge Urban Construction Group (BUCG), helped construct the new runaway that was built in the Velana Internation Airport after the Maldivian government decided to take on a loan of USD 400 million from China's Exim Bank. In addition to the runway, the firm promised the formation of a fuel farm that would protect 45 million tonnes of fuel, as well as a cargo facility that provided space to hold 80,000 tonnes of cargo.

Meanwhile, members of the opposition have expressed their concerns over the China's “debt trap” diplomacy, some stating their belief that the biggest struggle faced by President-Elect Ibrahim Mohamed Solih during his term would be paying back the debt owed to the Chinese government.