National debt will reach 200 billion by the end of this five-year term: President Solih
Criticizing the current administration's economic policies, former President Ibrahim Mohamed Solih stated that loans acquired during the COVID-19 pandemic were part of a strategic plan to save lives with a clear repayment framework. He warned that due to the government's fiscal mismanagement, the national debt is projected to surge to MVR 200 billion by the end of this five-year term. Furthermore, President Solih expressed deep concern over the declining performance of state-owned enterprises, noting that companies previously operating at a profit are now incurring significant losses.
President Solih delivers remarks during an MDP rally held in Lh. Naifaru. | Munshid | Munshid
President Ibrahim Mohamed Solih has stated that the national debt is projected to reach 200 billion rufiyaa by the end of this five-year term.
Speaking at an MDP rally held in Lh. Naifaru, President Solih stated that the government was compelled to take out loans during the COVID-19 pandemic as there were no funds remaining in the reserves. However, the President emphasized that providing food and medicine to the public was essential, noting that he considered saving the lives of citizens to be his most important duty.
He stated that a nation can only exist if its citizens are healthy and safe, which is why the loans were secured. President Solih further noted that lenders only provide financing when there is a clear policy in place for repayment. He added that the loans were taken after formulating specific plans and policies to ensure they could be paid back.
President Solih stated that while the economy remains stable with rising tourist arrivals and increased revenue, the state has accumulated 38 billion rufiyaa in debt over the past two years. He further noted that total national debt is projected to reach 200 billion rufiyaa by the end of this five-year term.
There is no reason to struggle with the repayment of those loans. The Maldivian economy possesses the inherent strength to manage them. However, what we are witnessing today is the conduct of those who lack the competence to manage it. Their constant narrative is that they have taken out too many loans, cannot repay them, and are unable to achieve anything because of this burden. Consider the past year: the economy has been functioning well, with tourist arrivals increasing by 10 to 12 percent. Revenue has grown, and the global economy remains stable. Oil prices hovered around 60 dollars, whereas during our administration, they surged to 148 dollars. Despite these favorable conditions, the state has been plunged into 38 billion rufiyaa of debt over the last two years. Total national debt has now reached 160 billion rufiyaa. If left unchecked, the public will be burdened with a national debt of 200 billion rufiyaa by the end of this five-year term.President Ibrahim Mohamed Solih
President Solih stated that the current situation is a direct result of the government's lack of a clear plan or direction. He further noted that Rasmale' is being reclaimed by taking out loans through the Maldives Airports Company Limited (MACL), which had previously been a well-functioning entity. President Solih highlighted that the company, once the state's primary revenue generator, has now been driven to a state of dependency on debt.
President Solih stated that MTCC is currently operating at a loss, noting that all previously profitable state-owned enterprises are now facing financial deficits. While STO remains stable for the time being, President Solih remarked that it is impossible to predict the company's financial standing by the end of this five-year term.
