Govt to divert USD 300mn earmarked for other projects to finance housing projects

President Dr. Mohamed Muizzu has decided to divert around USD 300 million in funds earmarked for other projects to finance housing projects, says Dr. Mohamed Shafeeq, the country’s finance minister.

Providing a total solution to the housing crisis was one of President Muizzu’s biggest electoral pledges.

In a meeting with the Parliament’s Public Accounts Committee on Wednesday, Shafeeq said that the housing crisis is the root of all social issues facing the Maldives. He said that addressing the issue is a top priority for the government in shaping its policies.

“The president has instructed to allocate 50 percent of PSIP projects for housing when drafting the budget,” he said.

Shafeeq said the government is also working on initiating housing projects through the USD 800 million line of credit granted by India through the Exim Bank. He said that the favorable terms of the credit facility had been one of the deciding factors in the government’s decision.

He said the government hopes to begin work on 4,000 housing units this year using the credit facility.

Deputy Speaker Ahmed Nazim, who sits in the Public Accounts Committee, questioned whether the government plans to divert funds allocated for other projects to run housing projects. He specifically asked whether the government has decided to utilize the funds earmarked to relocate the Male’ commercial port to Gulhifalhu to run housing projects instead.

“Because President Muizzu gives such high priority to housing, he wishes to start housing projects as soon as possible and provide a housing solution. What you say is correct in that regard,” he said.

Shafeeq said the government is trying to designate available financial facilities for housing. He said that the government expects to be able to divert nearly USD 300 million in available financing for housing.

He added that the government wishes to secure financing at as much favorable terms as possible.

He also expressed the need to diversify the economy and focus on expanding sectors other than tourism. He said that expansion of existing economic sectors and introducing new sectors is a key priority for the government.

Housing Minister Dr. Ali Haidar had previously said that the incumbent administration has not launched any housing projects of its own because it wants to complete the projects launched by the previous administration first.

Government officials have repeatedly criticized the former administration, accusing it of failing to allocate enough funds to run ongoing projects.