PSIP will cater to all islands with no discrimination: Minister

Minister of Finance, Ibrahim Ameer, has stated that there will be no discrimination in providing PSI programs for every island of the Maldives.

While responding to questions posed by MP’s during the parliamentary debate for the 2020 state budget, Minister Ameer stated that the proposed budget is compiled according to the current administration's manifesto. He added that the citizens living situations need to be well understood when discussing the topic of “surplus budget” as most islands do not have basic necessary services.

He explained that progress cannot be achieved by balancing the budget and that the budget has been proposed under an expansionary fiscal policy.

Additionally, the minister stated that the budget was calculated with the dollar exchange rate in mind. He noted that the exchange rate of MVR15.42 per dollar was at a premium of 2% last year, whereas next year’s budget is designed not to clash with the exchange rate.

The minister further disclosed that PSIP projects will be funded by the project’s loans. He noted that these projects were established with loans from foreign funding agencies, therefore, larger public sector investment programs require foreign funding as well.

The minister also explained that the foreign loans included in the budget are part of a bigger picture of the country’s economy. Hence, increasing capital expenditure will lead to more economic growth.

The proposed state budget of MVR 37.5 billion has an expenditure of MVR 35.6 billion and the biggest Public Sector Investment Programme (PSIP) seen in the country’s history, set at MVR 10.1 million, MVR five million more than the past year.