The Maldives Monetary Authority has attributed the successful settlement of a sovereign debt obligation to the government’s rigorous enforcement of foreign currency laws designed to enhance foreign currency revenues. The central bank confirmed the complete settlement of the USD 500 million sovereign sukuk, initially issued in 2021, with a total disbursement of USD 524.68 million including scheduled coupon payments.
The obligations were met on 2 April utilising the state’s official reserves and the Sovereign Development Fund, a repository established for sovereign debt repayment. The central bank asserted that the 2024 amendments to the Foreign Currency Act significantly fortified the nation's exchange framework, enhancing its capacity to honour state debt. These reforms were the direct result of vital collaboration between the government, state institutions, and the central bank. The authority provided assurances that it will continue to coordinate with all state entities to execute policies required to further bolster official reserves.
The sukuk originated in 2021 under the former administration to refinance a preexisting USD 250 million ‘Sunny Side’ bond. Upon assuming office, the current administration instituted measures to manage debt without straining the economy, specifically redirecting foreign currency deposits into the Sovereign Development Fund and adjusting Airport Development Fee rates.
Following the settlement, the administration declared its focus will shift toward ensuring the uninterrupted provision of essential goods and public services. Concurrently, the government confirmed successful negotiations with the Abu Dhabi Fund for Development to rollover a USD 100 million bond maturing at the close of this month.