News Desk
MALE’ — The dollar is scarce. The black market rate has crossed MVR 20. Importers are struggling, small businesses are quietly suffocating, and the ordinary Maldivian trying to send a child abroad for education or pay a foreign supplier is running into walls.
But do not worry. The Economic Development Minister has an explanation. It is the same one he had last month. And the month before that.
Mohamed Saeed stood in Majlis on Monday and, with the confidence of a man who has rehearsed this particular number many times, delivered his answer to the dollar crisis: it is the MDP’s fault. Both governments of it. Former President Ibrahim Mohamed Solih printed too much money. Former President Mohamed Nasheed pegged the dollar in a band back in 2011. The 19th Majlis suspended the law to enable the printing. And so here we are.
It is, by now, a song every Maldivian knows by heart. The melody is soothing, the rhythm is familiar, and it achieves exactly what a good lullaby should: it puts the hard questions to sleep.
The trouble is that the audience has stopped sleeping.
Because while the minister was singing in the Majlis, everyone outside it knows something that does not appear in his explanation. The Maldives sits on some of the most valuable resort real estate on the planet. The properties are leased. The dollars come in. And then, with remarkable efficiency, a great deal of those dollars go somewhere that is not a Maldivian bank account.
Luxury resort revenues, management fees, and returns on foreign-held leases have a well-documented habit of residing in accounts abroad. What circulates locally is largely what guests spend on minibars, excursions, and the occasional overpriced souvenir. The structural dollar leak is not a secret. It is not even particularly complicated. It is simply inconvenient to acknowledge, because acknowledging it would require talking about the present rather than the past.
Saeed noted, correctly, that during the Nasheed era the official rate moved from MVR 12.85 under Maumoon Abdul Gayoom to MVR 15.42 after the 2011 band. He noted that money printing under Solih made things worse. These are fair points. They are also points that were fair two years ago, one year ago, and will presumably remain fair at the next election.
What they do not explain is why, under a government that won a parliamentary supermajority and whose minister campaigned explicitly on a promise to bring the dollar rate back to the official peg, the black market rate is now above MVR 20 and climbing.
Saeed himself made that promise during the last parliamentary campaign. The supermajority was duly delivered. The dollar was not.
Former President Abdulla Yameen, never one to miss an opening, has already observed that a black market for dollars only emerges when a government fails. It was a pointed remark from a man currently awaiting a court rulings on many of his own corruption cases, which gives it a certain quality.
The government’s position, stated by Saeed with admirable consistency, is that President Muizzu’s policy is to end the debt cycle and build a credible economy. That may be true. The foreign exchange law passed last year, requiring businesses earning in dollars to convert a portion through the local banking system, was a real reform. Reserves have improved. The Sukuk was repaid. The IMF has taken note.
But reserves in the central bank and dollars on the street are two different things. The Maldivian who needs USD to pay an overseas invoice, cover a medical bill in Sri Lanka, India or settle a school fee in Malaysia, UK is not consulting the foreign reserves data. They are calling around, paying a premium, and finding the experience familiar.
The minister is not wrong about the past. He is just not particularly interested in the present, at least not in the Majlis, at least not yet.
The old song plays on. Out in the islands, the grandmothers know how it ends.
