The latest statistics from the central bank, MMA, reveal that the financial state of the Maldivian government is deteriorating day by day. By the end of 2023, the total revenue received by the state was 34 billion rufiyaa, while the total expenditure reached 48 billion rufiyaa. This represents a budget deficit of 14 percent of the country’s GDP.
According to information released by the Ministry of Finance, 76 percent of the revenue received last year, or 26 billion rufiyaa, was from taxes. However, the 658 million rufiyaa received as grants is 44 percent lower than the estimated amount. This highlights the danger of relying on foreign aid. Looking at government expenditures, 70 percent of the total expenditure in 2023, or 34 billion rufiyaa, was spent on running government offices and employee salaries. Additionally, 15 billion rufiyaa was spent on capital projects, which is one billion rufiyaa less than the budgeted amount. Furthermore, 11 billion rufiyaa was spent on PSIP projects, and 2.3 billion rufiyaa was spent on loan repayments.
In 2023, the country’s GDP stood at 109 billion rufiyaa, with the economy growing by 5.5 percent. According to MMA estimates, although the economy grew by 6.4 percent in 2023, these statistics show that urgent measures need to be taken to streamline government expenditures and increase revenue in order to achieve sustainable growth.
