Minister of Foreign Affairs Dr Ahmed Shaheed has told Miadhu that the Maldives’ national debt stood at 110% of GDP at the end of 2008 according to International Monetary Fund (IMF) reports.
Dr Shaheed said he is “not ashamed” to tell the truth about the country’s financial situation, because international financial institutions are monitoring the country’s external debts.
He said the country’s debt was due to the previous government’s extravagance in buying presidential yachts and offices. He added that this debt was the reason for the government reducing civil service salaries as they had no alternative.
Dr Shaheed said certain leaders of political parties are trying to spin the facts, contradicting the IMF’s reports.
Dr Shaheed said working with the international community and multilateral financial institutions is easing the country’s debt. The USA has readmitted the Maldives into the General System of Preferences, its duty-free quota system as well as signing an agreement with the US’s Overseas Private Investment Corporation (OPIC) which encourages companies to invest in the Maldives.
The Maldives also hopes to be admitted into the US’s development assistance project, Millennium Challenge Account, as well as the Paris Declaration on Aid Effectiveness.