Yameen Criticises MDP Government for Rising Debt

Former President Abdullah Yameen has called for accountability from the previous Maldivian Democratic Party (MDP) government, which he accuses of increasing the nation’s debt without devising a strategy for repayment.

During a presentation on the Maldivian economy at the People’s National Front (PNF) office, led by Yameen, he expressed concerns about the current financial situation. Yameen noted that the Maldives is required to pay USD 512 million this year to settle its foreign debt, while Maldives debt repayment stands at USD 490 million.

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He criticised the current lack of foreign currency to meet this obligation, stating, “We don’t have foreign currency to pay this debt in 2024.” Yameen further remarked that claims of deferred debt are misleading as the state reserves remain insufficient.

He also addressed remarks by some MDP members, who suggest that the debt incurred will only begin to be repaid from 2025. Yameen warned that this would only exacerbate the situation, with projected debt reaching USD 1.07 billion by 2026.

Yameen claimed that under the MDP administration, the reserves of the Maldives Monetary Authority (MMA) were severely depleted, with no significant economic projects or savings initiated. He criticised the current administration for not addressing these issues effectively during their first nine months in office.

He argued that simply deferring debt payments is not a viable solution. Instead, Yameen advocated for refinancing or restructuring, noting that while China has shown some flexibility, India’s approach to debt relief has been limited.

Yameen proposed that increasing revenue is essential for economic recovery. He pointed out that the economic contraction and its impact on businesses highlight the need for more income-generating opportunities. 

He expressed scepticism about the government’s bunkering services and Development Bank project as solutions for reducing debt and boosting the economy.