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.
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.