Former president Abdulla Yameen Abdul Gayyoom states that MVR 40 billion projected in revenue in the record-high MVR 64.2 billion budget proposed for 2026 is inadequate to cover expenses and as such, the government will not be able to implement any major projects with this allocation.
While speaking at People’s National Front (PNF)’s weekly gatherings on Thursday night, Yameen said a brief review of the government’s proposed budget for next year reveals a significant deficit.
“Revenue is stated as MVR 40 billion. With the total expenses, the total budget comes up to MVR 64 billion. Hence, this is a deficit budget,” he said.
“With respect to revenue and grants, we know that the government spends around MVR 2 billion each month on salaries — totaling about MVR 24 billion annually. After covering salary expenses, only about MVR 10 million remains. Moreover, grants are not something Maldives receives,” he said.
Yameen, citing India as the nation that has provided the most favorable bilateral grants to the Maldives to date, warned the government against expecting further grants from India as numerous loans withdrawn from the country by Maldivian administrations, including the current and the last administration, remains unpaid.
The former president’s warning comes while the government has forecasted to receive MVR 73.6 million in grants from Maldives’ closest neighbor and development partner, India.
It makes for 19.7 percent of the total projected foreign aid, and 86 percent of the MVR 86.5 million expected in grants from bilateral partners.
Yameen emphasized that MVR 86.5 million expected in grants is a low amount, pointing out duties imposed on imports and exports, along with tourism taxes as the only substantial sources of revenue which is projected to total at MVR 40 billion. He questioned whether the government can cover expenses with this figure.
The former president also criticized the current administration for creating an excessive number of jobs, comparing the situation to turtles laying eggs.
“Therefore, managing with just MVR 40 billion will be impossible. We will likely see even more jobs created next year. I can say with certainty that nothing significant can be achieved with this MVR 40 billion — not a single major project will be implemented,” he said.
He stressed that there are no funds to implement major projects announced by the government including Addu City’s Hithadhoo-Meedhoo bridge, with no way to acquire further funds either.
He noted that MVR 33.6 billion has been added to Maldives existing MVR 125 billion debt burden since the current administration assumed office.
“If these expenditures are carried forth, once again, there will be a need to print money just to cover recurrent costs. Money will inevitably be printed next year, as there is no other way to manage expenses.,” he said.
Yameen stated that printing money next year would further devalue the Maldivian Rufiyaa and make obtaining US dollars even more challenging.