A supplementary budget passed for this year will be financed through MVR 3 billion from the domestic market with the rest to be managed through economizing and deferring expenditure, Finance Minister Dr. Mohamed Shafeeq has said.
With this year’s budget surpassing MVR 49 billion with the supplementary budget, MVR 6.1 billion out of the MVR 6.5 billion added to the budget was to be financed with debt. The budget was passed with the bulk of it to be funded through foreign creditors or budget support loans.
After initially not disclosing the financing sources, the Finance Minister explained the plan for managing the budget to Adhadhu on Tuesday. Most of the funds can be raised through the sale of securities in the domestic market with an additional MVR 200 million to be secured as a foreign loan, he said.
The funds will be available early next month or mid-January at the latest, Shafeeq said. In the meantime, the government has decided to freeze all non-essential spending, he said.
As the country’s fiscal situation was poor, Shafeeq said the government will prioritize essential or basic expenditures as well as other expenditures important for government policies during the present difficult time. He expressed confidence that the country’s finances will improve as a result of the efforts.
The decision to finance most of the spending from domestic sources came after the supplementary budget was passed with MVR 1.9 billion to be raised from the domestic market.
