Govt seeks to dismiss deputy governor Imad amid money printing controversy

A no-confidence motion has been submitted to the Parliament’s Public Accounts Committee against Ahmed Imad, the deputy governor of Maldives Monetary Authority (MMA), amid controversy regarding the People’s National Congress (PNC) administration’s plan to opt for money printing or monetary financing to meet Maldives’ staggering debt obligations.

During his 2023 presidential campaign, President Dr. Mohamed Muizzu vowed he would never print money, as his predecessor had resorted to during the Covid-19 pandemic. He repeatedly reiterated this pledge after coming to power, and listed avoiding printing money as one of the biggest achievements of his administration in its first year.

However, Sun has been informed that the administration is engaged in negotiation on selling a large plot of land from Hulhumale’ that is under the management of the Housing Development Corporation (HDC) to MMA for a price of MVR 14 billion – MVR 15 billion.

On Sunday evening, President Muizzu hosted lawmakers from the ruling PNC at the presidential palace, Muliaage, to discuss the plan.

The plan to print MVR 15 billion has been met with concern not just from the opposition, but also from economists.

During a meeting of the Public Accounts Committee on Tuesday afternoon, Dhidhdhoo MP Abdul Latheef Mohamed presented a motion to advise President Muizzu to dismiss Imad. The motion was seconded by North Henveiru MP Ahmed Aifan.

They are both lawmakers from the PNC, who hold a supermajority in the Parliament.

The committee decided by majority vote to forward the motion to the Parliament. The dissenting votes came from two members.

The motion will now be presented at the Parliament floor. Once the motion passes the initial floor vote, it will be sent back to the committee so they can formally proceed with the no-confidence motion. The findings of the committee will be presented to the floor again for a final vote.

Imad joined the MMA in 2000, and was appointed as the deputy governor in 2020.

In the past, President Muizzu repeatedly blamed the Maldives’ current economic crisis on the “poor decisions” of the preceding Maldivian Democratic Party (MDP) administration, including the decision to print MVR 8 billion during the Covid-19 pandemic. He said his administration would improve the Maldivian economy without resorting to money printing.

The administration has faced backlash over the apparent reversal in its stance – something that it has refused to comment on so far.

The MMA’s board has seen at least two resignations since news of the money printing plan broke out. Ahmed Zayan Mohamed, the head of Finance Ministry’s Fiscal Affairs Department tendered his resignation on Monday, while Shuhad Ibrahim, a Consultant at the Economic Ministry, resigned on Tuesday.

Amid the controversy, Ahmed Zayan Mohamed, who represents the Finance Ministry on the board of the Maldives Monetary Authority (MMA), tendered his resignation on Monday.

Some economic analysist who spoke to Sun believe the administration is working on raising money to repay the staggering debt obligations due this year.

According to data shared by former President Mohamed Nasheed, the Maldives has a staggering USD 800 million (approximately MVR 12 billion to MVR 13 billion) in debt repayments due this year. This includes USD 150 million due by the end of March, and another USD 25 million in April.

Nasheed warned that by increasing the money supply by billions, the US dollar exchange rate is likely to surge well over MVR 24, consequently fueling inflation. He urged the administration revert to fiscal consolidation to reduce the budget deficit.

The MDP administration had printed MVR 8 billion due to the economic downturn during the Covid-19 pandemic. The former administration claims it resorted to printing money because it was left with no other choice to a complete cease in economic activity after the country’s airports were shut down.

But the move was widely slammed by the PNC administration in the past.

On Monday, the MDP accused the PNC administration of pushing the country’s economy to the brink of an economic disaster with its plan to print MVR 15 billion.