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Asia and Pacific > Maldives

You are looking at 1 - 7 of 7 items for :

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Cover IMF Staff Country Reports
Maldives: 2022 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Maldives
International Monetary Fund. Asia and Pacific Dept
The 2022 Article IV Consultation discusses that Maldives’ economic activity rebounded strongly from the pandemic-induced contraction, supported by the authorities’ decisive policy measures. Fiscal and external vulnerabilities remain elevated due to rising subsidies, high capital spending, and an increased interest burden. The Maldives has a high risk of external debt distress and a high overall risk of debt distress. Inflation has risen but is relatively contained due to price subsidies. Risks to the outlook are tilted to the downside, including a possible sharp slowdown in key source markets for tourism, high commodity prices, and tighter global financial conditions. A resumption of tourist arrivals from China is an upside risk to growth. The ongoing economic recovery provides an opportunity to swiftly implement a comprehensive set of reforms to reduce fiscal, debt, and external vulnerabilities, and strengthen economic resilience. The report recommends that financial sector policies should remain vigilant to safeguard financial stability considering the large exposure of the banking sector to the sovereign and the expiration of pandemic-related lending support schemes.
Keywords:
parliament approval; MMA authorities; staff appraisal; market in the Maldives; SARTTAC mission; government policy; Government debt management; Capital spending; Global
Cover IMF Staff Country Reports
Maldives: Technical Assistance Report-Revising the Fiscal Responsibility Act
International Monetary Fund. Fiscal Affairs Dept.
This Technical Assistance report discusses options to revamp the 2013 Fiscal Responsibility Act (FRA), taking into account the challenges posed by the current context in Maldives. The government has not met the FRA’s numerical targets for fiscal deficits and public debt. In order to ensure fiscal sustainability and enhance transparency, the Maldivian authorities are committed to introducing a new FRA in 2021. The Government needs firm and credible targets for debt and fiscal deficits in its debt-reduction efforts; however, past experiences of noncompliance with the numerical fiscal rules has undermined its credibility. A principles-based approach, accompanied by strong accountability requirements, would provide the authorities with the flexibility to respond to adverse macroeconomic developments. The new FRA would clearly define the specific roles of Parliament and the Auditor General in the fiscal responsibility framework. This report suggests enhancing fiscal oversight by strengthening the role of Parliament and the Auditor General. The report also identifies several areas of public financial management that should be addressed in other PFM laws for the successful implementation of the new FRA.
Keywords:
Maldivian authorities; government document; draft FRA need; documentation requirement; FRA draft; government finance statistics manual; Budget planning and preparation; Fiscal reporting; Fiscal risks; Australia and New Zealand; South Asia
Cover IMF Staff Country Reports
Maldives: 2012 Article IV Consultation-Public Information Notice; Staff Report; and Statement by the Executive Director for Maldives
International Monetary Fund. Asia and Pacific Dept
This 2012 Article IV Consultation with Maldives discusses that fiscal position is weak, and its external reserves are critically low. The country has a long history of fiscal and external imbalances. Macroeconomic policies need adjustment. The authorities have taken important steps in the 2013 budget to reduce the fiscal deficit, but further consolidation is needed, both to ensure debt sustainability and to strengthen the balance of payments. That latter goal would be aided by devaluation, combined with a restrictive incomes and subsidy policy, which would address the current overvaluation of the rufiyaa and help to curb imports. Monetary tightening would help to prevent the need for a further devaluation. Financial supervision, particularly with regard to the state bank, also needs strengthening. Given the track record, a Staff Monitored Program could be the appropriate starting point for any renewed engagement, however, in order to begin discussions, there would need to be a clear commitment on the authorities’ part to implementing a comprehensive set of policy adjustments.
Keywords:
ISCR; CR; deficit; Maldives economy; dollar; devaluation; exchange rate; MMA liability; targeted social assistance scheme; wage growth; financing climate; Imports; Tourism; Global; East Asia; South Asia; Europe
Cover IMF Staff Country Reports
Maldives: 2019 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for Maldives
International Monetary Fund. Asia and Pacific Dept
This 2019 Article IV Consultation discusses that growth in Maldives has been strong and is projected to remain so in 2019 driven by tourism, commerce, and construction. Nonetheless, the Maldives remains highly vulnerable with reduced policy space due to large and growing public debt and rising pressures on external stability. The consultation focused on addressing external imbalances including offering advice on restoring fiscal buffers, strengthening public finance management, reforming the exchange rate regime, building international reserves, improving governance, implementing structural reforms, and encouraging diversification. The outlook is for continued strong growth and moderate inflation, and only a gradual improvement in fiscal and current account deficits. As major infrastructure projects will gradually start to unwind, the current account deficit will begin to narrow. Under the current policies, the fiscal deficit is projected to remain elevated. However, successful implementation of tax reforms and improved tax administration, together with measures to contain budgetary spending, would result in a narrowing of both fiscal and current account deficits and mitigate the risks posed by high and rising public and external debt.
Keywords:
ISCR; CR; GDP; deficit; debt; IMF staff projection; SDF balance; government infrastructure investment; growth outlook; government's policy; financing pressure; Tourism; Global; IMF's transparency policy; IMF's articles of agreement; Exchange rate arrangements; Fiscal consolidation
Cover IMF Staff Country Reports
Maldives: 2010 Article IV Consultation: Staff Report; Staff Statement and Supplement; Public Information Notice on the Executive Board Discussion; and Statement by the Executive Director for Maldives
International Monetary Fund
Owing to severe fiscal and external imbalances, the Maldives government adopted an IMF program in 2009. Despite some crucial initial actions, fiscal slippages and political polarization have undermined the restoration of sustainability. The key policy challenge is to prevent a fiscal crisis, achieve macroeconomic sustainability, and stimulate growth. The authorities concur with the need to tighten monetary policy. The authorities have welcomed the IMF program as a useful framework to guide and reinforce their efforts to restore external balance and fiscal sustainability.
Keywords:
ISCR; CR; consultation informational annex; consultation; expenditure information point; debt; financing; staff appraisal; outturn data; data revision; Fiscal consolidation; Public and publicly-guaranteed external debt; Global; Asia and Pacific; I. fund relation; World Bank-IMF Joint Management Action Plan; Debt sustainability analysis
Cover IMF Staff Country Reports
Maldives: 2009 Article IV Consultation: Staff Report; Staff Supplements; Public Information Notice on the Executive Board Discussion; Press Release on the Executive Board Discussion; and Statement by the Executive Director for Maldives
International Monetary Fund
This paper examines the Maldives’ 2009 Article IV Consultation on economic developments and policies. The Maldivian economy is facing large external and fiscal imbalances, resulting from the severe impact of the global financial crisis and exacerbated by an unsustainable fiscal expansion. The global crisis has led to sharp declines in tourism and related investment, other net capital flows, and exports. This has caused a significant fall in fiscal revenue, compounding a large increase in public spending, and pushed the economy into recession. A rising share of the resulting fiscal deficit has been financed by monetization.
Keywords:
ISCR; CR; financing; government; deficit; GDP; IMF facility; policy support; Maldivian economy; debt service; IFC assistance program; Fiscal consolidation; Civil service; Global
Cover Policy Papers
Maldives-Assessment Letter for the Asian Development Bank and the World Bank
International Monetary Fund
The global crisis has hit the Maldivian economy hard; combined with an unsustainable fiscal expansion, it has led to a large fiscal deficit and severe balance of payments pressures. The authorities are committed to a strong policy adjustment program, and have requested IMF financial support for their program.
Keywords:
PP; financial support; GDP; deficit; IMF relation; deficit monetization; Maldivian economy; Fiscal consolidation; Government debt management; Fiscal stabilization; Global