Consolidating public debt while supporting national infrastructure mega-projects are two of the key priorities for Ahmed Munawar, the Maldives minister of finance and treasury.
For decades, the Maldives government borrowed from the central bank, a practice that led to monetary inflation. “Borrowing from the central bank in a country such as the Maldives leads to the printing of money,” says Mr Munawar. “Total money supply in our system expands and this leads to high inflation, which directly leads to reserve depletion. This is exactly what happened in 2008 to 2009. It is why we had to go to the International Monetary Fund for a programme and why we had a 20% [currency] devaluation in 2011.”
