Maldives Records MVR 1.28 Billion in Fiscal Surplus, Gov’t Stats Show

The Ministry of Finance and Planning reported that the Maldives has a fiscal surplus of MVR 1.28 billion as of June 12. 

In the most recent Weekly Fiscal Developments report published by the ministry yesterday, the Maldives has a total revenue and grants reaching MVR 16.96 billion, surpassing expenditures of MVR 15.68 billion.

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Revenue Highlights

The report shows that the government revenue collection remains strong, with total tax revenue reaching MVR 13.15 billion. This growth is primarily attributed to Value-Added Tax (VAT) and tourism-related levies.

In addition to tax revenue, non-tax revenue rose to MVR 3.71 billion, supported by dividends from state-owned enterprises (SOEs), as well as a broad range of administrative fees and service charges. These inflows continue to play a critical role in strengthening the government’s fiscal position.

Expenditure Overview

On the spending front, recurrent expenditure amounted to MVR 14.17 billion. The majority of this was allocated to public sector salaries, administrative costs, and various social support programs.

In contrast, capital spending remained low, with just MVR 1.50 billion disbursed so far—well below initial projections. Limited expenditure was recorded across key development areas such as infrastructure projects, land and building construction, and public sector capital investments.

Investment and Development

Spending under the Public Sector Investment Program (PSIP) stood at MVR 1.52 billion, a small fraction of the MVR 12.38 billion allocated for the year. This indicates delays or under-implementation in several planned development projects.

Notably, key sectors such as transport (roads, bridges, airports), housing, land reclamation, and coastal protection are among those with underutilized capital budgets. This trend highlights the need for accelerated execution of capital projects to meet national development goals.

Balance and Financing

The government recorded a primary balance surplus of MVR 3.36 billion, reflecting a strong fiscal position before accounting for interest payments.

Even after factoring in MVR 2.07 billion spent on interest and other financing costs, the overall budget still posted a surplus of MVR 1.28 billion. Additionally, loan repayments remained robust, with MVR 3.04 billion repaid so far in 2025, demonstrating the government’s continued focus on debt sustainability. This is an increase from MVR 1.13 billion paid in loan repayment by this period last year.

Analysis and Outlook

The current fiscal surplus signals a strong revenue performance, largely driven by sustained growth in tourism-related taxes and dividends from state-owned enterprises. This indicates continued resilience in key economic sectors, especially tourism.

Despite the positive revenue trend, capital expenditure remains significantly below expectations. This underperformance points to delays in infrastructure development, particularly in critical areas such as housing, transport, and land reclamation. The lag in capital deployment could impact the timely achievement of national development targets.

To unlock the full potential of the national budget, Public Sector Investment Program (PSIP) allocations need to be activated more effectively. Accelerated implementation of planned projects will be essential to stimulate economic activity and achieve long-term growth objectives.

On the financial front, the government continues to demonstrate sound debt management practices. This is evident from consistent loan repayments and the use of a diverse mix of sovereign debt instruments, including Islamic finance tools, to manage borrowing responsibly.