Friday 29th Mar 2024
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Finance minister Ameer

Shaheed Hussain Adam Building to be Registered under Finance Ministry; Ameer Says Not for Mortgage

Minister of Finance Ibrahim Ameer has revealed that the Male' City Council has been requested to register Shaheed Adam Building under the Finance Ministry. He falsified claims that state properties were being mortgaged to finance the state budget, and stated that the ministry has no intention of mortgaging state property.
During a program on RaajjeTV, Ameer explained that transferring beneficial ownership of assets valued at 51 percent of the Islamic Sukuk to be sold to a Special Purpose Vessel (SPV) fully owned by the government is not mortgaging.
To clarify misconceptions on how the government is obtaining loans, the Finance Minister stated that the government has no intention of obtaining loans by mortgaging assets in the Maldives. "There are two types. First, raising conventional finance. This is how all the previous governments have been issuing treasury bonds. Second, raising Islamic finance by selling Sukuk, Islamic securities. We are doing more in addition to this".
Unlike conventional financing, Islamic Sukuk does not involve just a financial transaction. Such a transaction can be conducted using a business or rent transaction of an asset in accordance with Islamic finance regulations. The Sukuk seller will be issuing a certificate equivalent to the amount they are seeking, or part of the value of a government asset. Each certificate will have a face value similar to company shares.
The public has been criticizing the government regarding the alleged mortgaging of state property. However, the government has been reiterating that it has not done so, and that no previous government has mortgaged state property either.
The concern now is what will happen to the asset if the government fails to make timely payments under such a transaction. Minister Ameer assured that despite not being able to pay, the property will still be under the ownership of the government as the Sukuk holder will not have legal rights over the property.