Loans were taken in 2024 for important projects: Finance Ministry

Ministry of Finance has said that last year, loans were taken at low interest rates for important projects that will benefit the public.

Last year, the government has taken a total of USD 334 million (MVR 5.2 billion) in loans.

The loans were in large part taken for the project on completion of the Velana International Airport. Loans were further taken for establishing hospitals in some atolls and to arrange financing for small and medium enterprises. The Finance Ministry pointed out that one of the benefits of this would be improvement to health services in the country.

The ministry said that in addition to the loan for health services, loans were also taken for environmental protection, and to minimize reliance on imports through promoting agricultural production. ]

"All the loans taken in 2024 are concessional and at concessional rates from bilateral and multilateral sources. So compared to commercial loans, Maldives is getting loans at lower rates," the Finance Ministry said.

Although the ministry said the loans are taken at concessional rates, they did not offer details regarding the rates.

As per Ministry of Finance statistics, the largest loan was taken from Saudi Fund for Development. This is the USD 150 million (MVR 2.3 billion) loan taken for the development of Velana International Airport.

The second highest loan is from Export Import Bank of China (China EXIM). This is a USD 75 million (MVR 1.2 billion) loan taken for Velana International Airport project refinancing and upgrade.

The third highest loan is from Islamic Development Bank (IDM). Two loans taken from IDB come up to USD 40 million (MVR 617 million). This was taken to arrange funds for small and medium enterprises.

Finance Ministry statistics show that last year's total State debt was at MVR 139 billion. The budget estimates that this year's State debt will reach MVR 150 billion, which is 124 percent of GDP.

Loans of USD 334 million taken in 2024

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