Zameer: International community no longer concerned Maldives will go bankrupt; trust restored

Finance Minister Moosa Zameer, on Thursday, remarked that the international community are no longer concerned that the Maldives will go bankrupt, adding Maldives has restored international trust.

Speaking at a ceremony on Thursday to award 206 government projects to private companies, Minister Zameer stated that the current administration has repaid over USD 1 billion from the mountainous debt it had inherited in these two years since assuming office. He added that the government was running on a surplus budget in the first 40 weeks of this year: something which he attributed to responsible fiscal management. The surplus means the state’s revenue exceeded its expenses during this period.

“It is our biggest relief that Maldives is no longer viewed as a nation on the brink of bankruptcy. We have restored international trust and secured easements for foreign debt obligations. [The international community] has begun accepting Maldives as a trusted partner,” he said.

Speaking further, Minister Zameer underscored that the government is still undertaking efforts to settle unpaid dues to contractors and suppliers, adding that the current administration will only award projects to companies capable of carrying out the work.

“Even today, we are taking an important measure in this trajectory. Families residing in islands are pleading for safe harbors, good schools and healthcare facilities. Modern waste management systems and centres to ensure fit generation of youths,” he said.

In this regard, he said the 206 projects signed on Thursday on a contractor financing basis are aimed at fulfilling these needs.

Minister Zameer detailed that a clear framework will be established to ensure these projects are being implemented responsibly which will detail the standard of performance expected by the government and disbursement of payment in accordance with performance of the contractor.

The purposes of the framework:

• Producing results desired by the citizens: The government priorities project that will directly benefit the public
• Financial protection and sustainability: The government has strengthened due diligence when awarding projects and standardized a payment framework
• Ensuring the standard of government assets produced via projects: The government will consider the fragile environment of the Maldives
• Creating jobs and increasing participation of private contractors

Minister Zameer said the contractors who signed the projects today will be awarded payments after the respective government institutions assess the progress.

Both the incumbent PNC administration and the last MDP administration have come under fire for delays in disbursing payments to private companies.

Amid growing concerns over the matter, President Dr. Mohamed announced on October 2nd that the government would clear MVR 2.3 billion in outstanding payments to private companies within five weeks. On Wednesday, the President confirmed that these payments were being processed.

There has been significant public backlash over the source of the funds following a currency transaction between the Maldives Pension Administration Office (MPAO) and the Maldives Monetary Authority (MMA). The transaction involved the sale of a government bond in the secondary market, which some opposition figures have equated to printing money.

Saruvash Adam, who represented the private sector on MPAO board, resigned on October 22, citing legal and economic concerns over the bond deal. He did not elaborate on the nature of those concerns. Meanwhile, MPAO’s Chief Financial Officer, Hawwa Fajuwa, resigned on Tuesday.

Although senior government officials have confirmed the bond sale, the Finance Ministry has not yet officially released details of the transaction. Some media reports, citing ministry sources, said the funds are intended to settle payments to private companies.

Notably, the majority of recent government projects were awarded to state-owned enterprises, drawing criticism of the administration. Additionally, some of the projects assigned to SEOs exceeded their official mandate. The subsequent backlash prompted President Muizzu to announce plans to award government projects to private companies.