Reserve retained by end of January

Maldives Monetary Authority’s economic review shows the State reserve was retained December to end of January with a slight increase to the total amount.

The amount of money in the State reserve was MVR 476.1 million both at end of December, 2016 and end of January, 2017.

The usable reserve showed a 1 percent increase from MVR 200 million to MVR 201.5 million by end of January.

At the end of 2016, MMA purchased a MVR 140 million bond from Maldives Airports Company Limited (MACL) to settle the court-mandated compensation payment to GMR by tapping into the State reserve.

To mitigate the impact to the reserve, Maldivian government made a currency swap with Reserve Bank of India through which RBI provided MMA with USD 100 million in exchange for Maldivian Rufiya worth the same value.

“As the amount is paid back, India will be returning Maldivian Rufiya equal to the amount.

Maldives will be paying an interest as its paid back. It’s a flexible rate of three percent,” said an official from MMA regarding the currency swap.

Singapore International Arbitration Center ordered Maldivian government to pay USD 271 million in compensation to GMR for dissolving the contract to manage Velana International Airport (then knows as Ibrahim Nasir International Airport).

The amount was settled by MACL in November, 2016.