Finance Minister Ibrahim Ameer has stated that Maldives' credit rating will be lowered if the debt is restructured.
The Minister said this in writing, replying to a question posed by Central Maafannu MP Ibrahim Rasheed in Parliament today.
Ameer said that government debt, in relation to GDP, stood at 118 percent by 2022. 100 percent of this is the debt taken directly by the state, and 18 percent is guaranteed debt. The Minister said the country's debt-to-GDP ratio is expected to reach 111 percent by the end of 2023.
Ameer said that debt restructuring would lead to credit rating agencies lowering the country's credit rating. The Minister said that this will make it difficult for the government and businesses to get loans. Therefore, he said the best way to manage debt is to increase government revenue and reduce expenditure. Minister Ameer said that the government's fiscal policy was formulated with these things included.
Fitch, the credit rating agency, said in October last year that Maldives' rating was "B minus" while Moody's has assigned Maldives a credit rating of "CAA".
The government says it has the ability to pay the debt. And that the country will not go into a state bankruptcy without paying the debt.
The Minister said this in writing, replying to a question posed by Central Maafannu MP Ibrahim Rasheed in Parliament today.
Ameer said that government debt, in relation to GDP, stood at 118 percent by 2022. 100 percent of this is the debt taken directly by the state, and 18 percent is guaranteed debt. The Minister said the country's debt-to-GDP ratio is expected to reach 111 percent by the end of 2023.
Ameer said that debt restructuring would lead to credit rating agencies lowering the country's credit rating. The Minister said that this will make it difficult for the government and businesses to get loans. Therefore, he said the best way to manage debt is to increase government revenue and reduce expenditure. Minister Ameer said that the government's fiscal policy was formulated with these things included.
Fitch, the credit rating agency, said in October last year that Maldives' rating was "B minus" while Moody's has assigned Maldives a credit rating of "CAA".
The government says it has the ability to pay the debt. And that the country will not go into a state bankruptcy without paying the debt.
