The people have lost confidence in the Pension Office after it approved using the pension fund for money printing in the guise of a financial securities transaction, the opposition Maldivian Democratic Party (MDP) President Abdulla Shahid said yesterday (February 3).
In a post on social media X, Shahid said the government was undermining the powers of independent institutions because it had been unable to raise the necessary funds for the state budget.
Referring to resignation from the Pension Office, Shahid said it showed that this transaction was a dangerous move that would have an adverse impact on the economic situation in the Maldives.
"It is an injustice to the people of the Maldives that the entire economy has to pay the price for the government's inability to raise the money needed for the budget. As a result of the secrecy surrounding this major transaction, the people have lost confidence in the Pension Office," said the former Foreign Minister.
Shahid said the deterioration of the work of independent institutions under the Muizzu administration is proof that the Maldives is in need of good governance.
“It is the inability of the government to choose authoritarian tactics without consultation on such a major issue,” he said.
Pension Office board Chairman Ahmed Inaaz and private sector representative Ahmed Saruvash Adam resigned from the board after saying this transaction would be detrimental.
Both Inaaz and Saruvash said the transaction would have negative consequences in the near and distant future at a time when the state's financial situation is fragile.
In addition, Ahmed Rasheed, who represented the Finance Ministry on the board, and Hawwa Fajwa, who was the Chief Financial Officer (CFO) of the office, also resigned. Reports say their resignation is also connected to the money printing transaction.
Reliable sources confirmed to Adhadhu that the board approved the MVR 2.4 billion transaction on February 2. They did this by appointing an interim Chairman.
The Pension Office will conduct this transaction by selling bonds previously purchased from the Finance Ministry to the Maldives Monetary Authority (MMA) and investing the proceeds in a new long-term government bond.
The Pension Office issued a statement defending the board's decision amid widespread criticism of the transaction on February 3.
President Mohamed Muizzu has repeatedly said that he will not print money.
However, technical experts told Adhadhu that the MMA is funding the transaction using reserves that it does not have. In this case, the money circulating in the economy increases. The experts confirmed that the transaction meets all the criteria of money printing.
Former President Mohamed Nasheed said printing money is a big mistake and warned that the country was blindly heading towards an economic collapse.
Reliable sources confirmed that Mizna Ahmed, Abdul Majeed Ali, Mohamed Madhin Latheef and Aminath Shazra Moosa voted to approve the decision. Shifaza Wajeed did not attend the board meeting.
