Ministry of Finance revealed that the national debt of Maldives increased to 73 percent during the last two years.
The debt bulletin publicised by Finance Ministry disclosed that the state's debt increased by MVR 18 billion from December 2016 to December 2018. During this period, internal debt also increased by five percent.
During the presidency of Abdulla Yameen Abdul Gayoom, the government issued guarantees for several loans taken to fund major development projects. Subsequently, state issuance of loan guarantees increased by 267 percent between December 2016 and December 2018.
Taking the country's productivity into account, debt was at 72 percent at the end of 2018, which is an increase of 11 percent compared to 2016 and 2017. During those two years, considering the country's productivity, debt was at 61 percent.
In 2018, international debt increased by 22 percent and the amount owed by the state to foreign countries currently stands at MVR 20 billion. Loans taken to develop Dharumavantha Hospital and Velana International Airport (VIA) comprises 60 percent of this figure.
While debt levels have reached a new high, the government utilized MVR 1.6 billion to pay off a part of this debt in 2018, a 20 percent increase compared to 2017 figures. Out of this sum, 68 percent went towards loan repayment whereas the remaining was paid as interest.
Overall, 8 percent of total state revenue was used to partially pay off Maldives' external debt.
Although expenditure on external debt rose, state spending on internal debt dropped by 44 percent. The main reason for this decrease was full payment of a short term loan taken by the state from the Bank of Maldives (BML).
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