The government is preparing to take out a loan of more than USD 100 million from the Abu Dhabi Fund.
Adhadhu understands the loan is being taken for tourism development. The government has not officially commented.
Sources told Adhadhu that Finance Minister Moosa Zameer is scheduled to leave for the United Arab Emirates (UAE) to sign the loan agreement.
The exact loan amount and interest rate is unknown. But Adhadhu understands the loan amount will exceed USD 100 million.
This comes after top level discussions between the government and financial institutions to borrow USD 300 million to pay off debt and cover costs this year.
A record budget of MVR 64 billion was approved for the third year of President Mohamed Muizzu's administration.
The budget book shows that MVR 12.9 billion will be spent on debt repayment. In April alone, USD 600 million (MVR 9.2 billion) is due in debt.
The USD 500 million (MVR 7.7 billion) sukuk is due to be paid on April 8. The USD 100 million (MVR 1.5 billion) bond is due April 26.
The World Bank estimates that more than USD 1 billion will be spent on debt repayment this year, including the debt owed by some state companies.
The Solih administration sold the USD 500 million sukuk in April 2021 to refinance the USD 250 million bond sold by the Yameen administration in 2017 and manage the economy due to financial challenges caused by the COVID-19 pandemic.
The Yameen administration sold the bond to pay compensation to GMR company for unlawfully cancelling the Velana airport agreement. The money was also used to build Dharumavantha Hospital in Male'.
Muizzu and Zameer previously insisted that there is no difficulty in repaying the debt.
Cargill Financial Services International has offered a high interest rate on a loan the government is trying to take to pay off debts.
Sources told Adhadhu that Cargills has offered the loan, but the government has not yet decided on the offer due to the high interest rate.
Some people, including the unofficial X account of former President Mohamed Nasheed, who have expressed concerns on social media say the interest rate is 15 percent.
