President reassures nation on debt management, 'No need to worry'

President Dr. Mohamed Muizzu addressed concerns regarding the nation's burgeoning debt on Wednesday evening, reassuring citizens that the government is actively managing its financial obligations and implementing strategies for future repayments.

Speaking at a rally organized by the ruling People’s National Congress (PNC), the President emphasized that there is "nothing for people to worry about."

President Muizzu highlighted the government's simultaneous commitment to advancing development projects and stabilizing the national economy. He asserted that the economy is currently "moving at the right pace and in the right direction," underscoring the administration's efforts to ensure fiscal responsibility.

A significant point of relief for the government, according to the President, was China's decision to finalize agreements facilitating the Maldives' debt repayments to the East Asian giant. He described this as a "great relief," indicating the importance of these bilateral arrangements in easing the nation's financial burden.

Furthermore, President Muizzu stated that comprehensive plans are in place to address outstanding debts, ensuring they will be settled "without struggling economically."

In a subtle critique of the previous administration, he affirmed that current developmental projects would proceed "without printing money," a practice often associated with inflationary pressures and economic instability.

"We will continue to pay off the external debt and the domestic debt of the people while fulfilling our promises to the people. And hopefully without printing money," he reiterated.

The Maldives has faced increasing scrutiny over its debt levels. Projections indicate a substantial debt servicing requirement, with approximately USD 500 million due this year and an estimated USD 1.1 billion in the coming year.

The exact quantum of the Maldives' debt to China, however, remains undisclosed.

In response to persistent calls from foreign financial institutions for spending cuts, the government has consistently assured its commitment to debt repayment. The administration has also outlined plans to reduce operational costs by revamping project implementation methodologies and delegating certain projects to government-owned enterprises, aiming for greater efficiency and fiscal prudence.