Minister of Finance, Ibrahim Ameer has stated that the only way the country can recover from the pandemic-induced recession was through increased government spending, for which funds need to be acquired as debt.
In today’s Parliamentary sitting, Minister Ameer said that the main focus of the 2021 state budget was to overcome the economic disruptions caused by the COVID-19 pandemic. However, some lawmakers have expressed concern over the increased expenditure which stands at nearly twice the amount of estimated revenue.
“What’s included in the budget are necessary projects to stimulate the economy,” said the Minister. “In order to recover and get back to where we were before the pandemic, we have to widen the economy. This means obtaining funds for debt and prioritizing what we get. Otherwise, there is no revenue to be made.”
According to the Minister, if the budget was to be reduced, it would leave the Maldivian economy stagnant and unable to progress.
The projected budget for next year stands at MVR 34.7 billion with an estimated revenue of MVR 17.7 billion. Expenditure is expected to be MVR 33.2 billion. The budget has a total deficit of MVR 15.50 billion.