The Maldives Monetary Authority (MMA) has reported an increase in the nation’s usable reserves, which have now reached USD 61 million.
According to the latest statistics from the MMA, the official reserves saw a significant rise of 36% in August compared to July. The reserves, which stood at USD 45 million in July, increased to USD 61.22 million by the end of August. This development comes amid the government’s proactive measures to manage the economy amidst global and regional uncertainties.
The MMA also pointed to a consistent rise in government reserves over the past seven months. By the end of July, the total reserves amounted to USD 395 million, and this figure grew to USD 444 million by the end of August. This upward trend indicates the effectiveness of the fiscal strategies employed by the government and the MMA to manage the nation’s resources more efficiently.
One of the key steps taken to stabilise the financial situation has been the management of the Sovereign Development Fund (SDF). Previously, the SDF had been reduced to USD 5 million due to custodian marking, but it has now increased to USD 65 million. The MMA emphasised that the SDF is being maintained separately to ensure its integrity and proper utilisation in line with the country’s financial policies.
The usable reserves were reported at USD 105 million at the end of the first seven months of the year. Looking ahead, the MMA has projected that the combined total of usable reserves and the Sovereign Development Fund will surpass USD 606 million by the end of the year. This optimistic forecast suggests a steady recovery path for the Maldives’ economy.
To further enhance the country’s financial position, the MMA is collaborating with the government on the issuance of a refinance green bond. This initiative aims to support sustainable development projects and align with global trends towards environmentally friendly investments. Additionally, the central bank has completed the technical groundwork for a USD 400 million foreign currency swap arrangement with the Reserve Bank of India under the SAARC framework. The agreement is currently awaiting final signatures, which would provide additional support for the country’s foreign currency reserves.
The MMA has expressed confidence that the government’s medium-term fiscal and debt strategy, which includes measures such as spending cuts and initiatives to increase revenue, will lead to notable improvements in the nation’s financial health. With these strategies in place, the MMA anticipates a significant recovery by November 2024, positioning the Maldives for a more stable economic future.
