State expenditure for January to August this year increased 13.5 percent on the same period last year, according to figures from the Department of Planning.
According to statistics from the Finance Ministry, the Maldives is facing a budget deficit of MVR 2.1 billion (US$136 million) on the back of revenue of MVR 7.7 billion (US$499 million), and expenditure of MVR 9.8 billion (US$635 million).
Meanwhile, revenue figures published by the Maldives Inland Revenue Authority (MIRA) for September showed an increase in revenue of 16 percent compared to the same month in 2011, however this was 2 percent less that expected.
More than a third of total revenue (36.4 percent) came from tourism land rent, an increase of US$1.8 million on the previous year to 14.6 million, followed by the Goods and Services Tax (GST) which increased US$2.6 million to US$7.2 million – representing 28.6 percent of total revenue for the month.
The MIRA figures do not include import duties which are received by customs.
The Maldives Monetary Authority (MMA)’s September review observed that while an increase in tourism arrivals had registered improvements in both monthly and annual terms, real GDP growth was expected to fall to 5.5 percent in 2012, a fall of two percent on 2011.
“As per the latest government cashflow statement, the overall fiscal deficit of the government
worsened during Jan-Aug 2012 compared to the same period of 2011,” the MMA observed, predicting a higher than expected budget deficit for the year.
Fishing – the Maldives’ second largest industry after tourism and responsible for almost 40 percent of the country’s employment, has steadily declined in terms of both catch and export earnings. MIRA’s figures for US dollar earnings highlight the country’s near total-dependency on tourism as a means of earning foreign exchange.