Government's current dollar conversion policy is driving up both the exchange rate and the cost of living day by day: Amru

Former Managing Director of STO, Hussain Amru, has stated that the government’s current dollar exchange policy is driving up both the exchange rate and the cost of goods on a daily basis.

President Dr. Mohamed Muizzu’s administration has introduced a legal mandate requiring the mandatory conversion of US dollars into local currency. Under these regulations, resorts are required to exchange $500 per tourist, while hotels, guesthouses, and tourist vessels operating in inhabited islands must exchange $25 per guest. Following President Muizzu’s ratification of the bill on December 14, 2024, the government stated that implementing these mandatory conversions would lead to a reduction in the cost of goods and the eventual elimination of the dollar black market.

Speaking on RaajjeTV regarding the matter, Amru stated that the Maldives' tourism industry remains robust, with more than 4,000 tourists arriving in the country daily. He further noted that a significant number of tourists visited the Maldives during the peak season months of December and January.

Amru stated that while a significant amount of foreign currency is being exchanged with the government, none of these dollars appear to be reaching the public or the business community.

Amru stated that while the dollar exchange policy initially offered a glimmer of hope, it has now become clear that it was a deception, adding that the true purpose and intent of the policy remain ambiguous. He further noted that the policy has failed to benefit the public, businesses, or resorts, as commodity prices continue to rise daily instead of becoming more affordable.

Prices had already begun to rise even before the start of Ramadan. Reports from the Maldives Monetary Authority (MMA) indicate that inflation stood at 4 percent by the end of 2025. To put this into perspective, if a family previously spent 10,000 Rufiyaa per month on groceries and food, they must now spend 10,500 Rufiyaa to purchase the exact same items. This means that by the end of 2025, consumers are required to spend an additional 500 Rufiyaa monthly just to maintain the same standard of living they had in 2024, without adding any new goods to their basket. When faced with this additional 500 Rufiyaa expense, families are left with difficult choices. They must either dip into their personal savings or significantly cut back on other essential expenditures to make ends meet.

Hussain Amru, the former Managing Director of STO

Amru noted that the dollar exchange rate is unlikely to decrease under the current administration, pointing out that the rate has remained above MVR 20 for nearly two years. He further stated that no positive economic changes would be seen with this government and called upon the public to take a stand to bring about change.