Finance Minister Says Debt Default Risk Is Behind Maldives as Reforms Take Hold

Finance Minister Moosa Zameer said on Tuesday that the government has implemented significant reforms to the country’s financial and administrative systems since taking office, and that the risk of sovereign debt default that loomed over the Maldives in 2023 has been addressed.

Speaking at a press conference at the President’s Office, Zameer said when President Muizzu took over, the most pressing concern was the possibility of the state failing to meet its debt obligations. He said the government responded by rationalising expenditure, setting a clear economic agenda and making structural changes to financial management, which allowed a substantial portion of state debt to be paid off.

The government settled a USD 500 million Sukuk in April and announced it had cleared nearly USD 974 million in total obligations over 40 days, which Zameer said demonstrated the effectiveness of the reforms.

On fuel supply, the minister said the government is aware that disruptions linked to the Middle East conflict have raised public concern about whether the Maldives will face fuel shortages. He said both ministers and the President have repeatedly assured that fuel supply will not be interrupted and that the government will continue to subsidise fuel costs to reduce the burden on the public, even though global oil prices are outside the government’s control.

On future borrowing, Zameer said if the government needs to take on new debt, it will do so with clear repayment plans in place.