President: Salaries cannot be increased when inflation increases

President Abdulla Yameen said on Wednesday salaries of workers cannot be increased when the inflation rate of the country increases.

Speaking during the “Economic Dialogue with the President” event held at Dharubaaruge, President Yameen said that the state budget could not accommodate increasing the salary of someone who receives MVR 10,000 today, to MVR 15,000 tomorrow because the country’s inflation rate had increased.

“One problem is that the price of things go up when inflation rises. Another problem is that our income does not increase. Therefore in reality, when inflation increases, the real income – the amount of money a person actually has for spending – even though the salary remains the same, in reality, the person’s spending money or the person’s salary has actually shrunk because of the spike in inflation. There are such difficulties,” he said.

President Yameen said that it was important to maintain inflation at a controllable level. He said that the inflation rate in 2013 was maintained at a level that was beneficial for the development of the country. He said that it was his policy to cut down inflation.

“It can even be said that there isn’t any inflation in the country. This is one of the good changes that is being brought to the economy. Both Maldivian businessmen and foreign businessmen – they don’t operate solely by relying on the money they bring. They will bring their own money. But they will also take loans from the banks in the countries they operate in. They will also take loans from banks outside Maldives. If the loan interest rate in Maldivian banks are high, they will not borrow from Maldives or they will limit the amount they borrow,” he said.

President Yameen said it was important to find ways to earn money for the country from dollars. He said that the country’s economy needed to be diversified, and that if Maldivians tried to bring about the changes they wanted to the economy by themselves, they would need to wait another decade.

“Reclaiming land for Hulhumale’ turned out to be very rewarding. There were those with conflicting opinions within the government. But President Maumoon went ahead with it. As it was done using money funded from within, and in a tempo set by us; it took some seven-seven and a half years to reclaim land. But today we have reclaimed land for a larger

Hulhumale’ than before. Not in seven and a half years. But in nine weeks,” he said.

President Yameen said that land could be created, and that there were more than enough shallow lagoons in the country. He said that land the size of Hulhumale’ times 35 could be reclaimed by spending MVR 500 million. He said that there was no reason why any Maldivian should worry about any land in Maldives being owned by a foreigner.