Finance Ministry Reveals 2024 Budget Projection of MVR 50.6 Billion

The Finance Ministry has unveiled its fiscal strategy report, outlining a budget projection of MVR 50.6 billion for 2024. This estimate includes baseline expenditure, potential savings through cost-cutting measures, and new projects and programmes slated for inclusion in the budget. It reflects a 5.3% increase compared to the current fiscal year’s budget estimates.

In 2024, the Finance Ministry’s report initially projected total expenditure to be MVR 48 billion. Within this total, recurring expenditure was estimated at MVR 32.7 billion, while capital expenditure was projected to be MVR 14.9 billion. The implementation of the suggested cost-cutting measures is anticipated to bring down the expenditure to MVR 44.9 billion in 2025. Looking at the medium-term outlook, the Finance Ministry predicts that spending will increase at an average annual rate of 0.5%.

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Taking into account the proposed adjustments in the government’s expenditure and revenue policies, it is anticipated that the total deficit for the 2024 fiscal year will amount to MVR 9.8 billion. This figure represents 8.5% of the Gross Domestic Product (GDP). Additionally, the Finance Ministry foresees a primary deficit of MVR 4.5 billion in the budget for the same fiscal year, equivalent to 3.9% of the GDP.

In the medium term, the Finance Ministry has outlined a projection to restore the primary balance of the budget. This will be achieved by reducing the overall deficit in the country’s budget through adjustments in revenue and expenditure policies. By doing so, the government aims to reach a sustainable level and mitigate the rate of increase in public debt.

The Finance Ministry foresees that the Maldives’ debt will remain at the same level as in the current fiscal year, estimated at MVR 111 billion.

It is important to note that while the fiscal strategy report offers an overview of budget estimates, the detailed budget will be presented to parliament by the Finance Ministry at the end of this month. The ministry is presently collaborating with the president-elect’s team to finalise the budget for the upcoming year.

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