No negative impacts on economy from COVID-19 funds

Dhaandhoo MP Yaugoob Abdulla, speaking at a parliamentary session. (Photo/Parliament)

MP for Dhaandhoo, Yaugoob Abdulla has said that he does not believe there would a negative impact from releasing MVR 4 billion to the government to continue with its work without any interruptions.

MP Yaugoob stated that the funds would not release in a drastic hike in prices of goods and the devaluation of the Rufiyaa. The MP was speaking in a parliamentary session where Finance Minister Ibrahim Ameer’s letter requesting amendments to the laws surrounding state financial responsibilities was the subject of discussion.

During the discussion, some MPs noted that the move could result in high inflation and the devaluation of the currency.

MP Yaugoob, did not agree with this rhetoric when he stated that the current situation was an exception and that the government needed the funds to assist the members of the public who have lost their jobs and are suffering from financial difficulties. MP Yaugoob, sided with MP Shareef for Maradhoo, Addu City who also called on the parliament to pave the way for the funds to be released.

“I don’t believe that the allocation of an overdraft of MVR 4.2 billion would result in much of a negative impact on the inflation and exchange rate. Due to the fact that Maldivians and the world have also moved away from the usual lifestyle.” Said MP Yaugoob who is educated in chartered accounting.

MP Yaugoob also pointed out that the price of petrol and diesel in the world market has fallen drastically, and noted that this was where the majority of the cash that flows out of the country is directed towards. MP Yaugoob also made the fact a basis for his argument that the injection of MVR 4.2 billion would not have a negative impact.

He added that the Finance Minister had proposed to extend the order facility for a period of one-year and explained how the cash would be sourced. MP Yaugoob stated that he did not believe that the funds would be spent on the economy all at once.

“Meaning that the government does not have the mindset to spend the MVR 4.2 billion on the economy flow all at once. The government’s idea is that if cash is received as income by the state in any manner, to repay the overdraft amount taken from the MMA. That is what the government’s mindset is from what I was informed by the proposal.” Said MP Yaugoob.

Some MPs have even described the move as handing the government a “blank cheque” a notion that was dismissed easily by MP Yaugoob. He said that the independent institutions and the parliament had the capacity to hold the government accountable in case the funds were misused.