Finance Ministry Forecasts MVR 15 Billion State Deficit with Supplementary Budget

The Ministry of Finance has reported an anticipated increase in the state deficit, expected to reach MVR 15 billion with the inclusion of a recently proposed supplementary budget of MVR 6.5 billion.

According to the ministry’s supplementary budget report, this adjustment will result in a deficit-to-GDP ratio of 14%, a notable increase from the 8.3% recorded for the 2023 fiscal year. In 2022, the state concluded the year with an annual deficit of MVR 11 billion, representing 12% of the GDP.

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The ministry has indicated that its primary objective for the upcoming state budget is to sustain the deficit-to-GDP ratio at 5%.

State expenditure is expected to reach MVR 47 billion by the end of 2023, while state revenue is projected to total MVR 32 billion. The government will acquire MVR 3 billion in budget support loans to fund the supplementary budget, with an additional MVR 1.9 billion financed through treasury bills (T-Bills) and an external loan of MVR 1 billion.

Alongside the MVR 6.5 billion increment in the state budget, the state debt is set to rise by MVR 6 billion, resulting in a total national debt of MVR 120 billion by the end of 2023.

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