President Dr. Mohamed Muizzu has said the government aims to reduce its debt and find a solution to the country's financial problems this year.
In his address to the opening session of the People's Majlis today, Muizzu spoke about the country's economic situation.
"Although the economy is growing and government revenue is increasing, there are still many challenges facing the state finances. I want to put an end to the systematic arrangement that has been a tradition of running the state expenditures in excess of revenue for years,” he said.
He said strong measures have been formulated to address the issue and the implementation of these measures is progressing swiftly.
"With measures being taken to reduce expenditure, the aim is to reduce the deficit substantially this year and reduce the amount of government debt. The goal this year is to reduce the budget deficit to MVR 9.4 billion with the increase in revenue and cost-cutting measures," Muizzu stated.
The Auditor General's Office estimated that the government's debt increased by MVR 21.8 billion last year with the supplementary budget financing.
According to the Finance Ministry, the total debt of the government is estimated at MVR 146.6 billion as of last year. That is 117 percent of GDP.
In 2024, recurrent expenditure stood at MVR 33.9 billion while capital expenditure stood at MVR 14.6 billion. The bulk of recurrent expenses were incurred for administrative and operating expenses while the bulk of capital expenditures went to infrastructure.
