The Government has proposed an amendment bill to transfer the ownership and administration of the Sovereign Development Fund (SDF) to the Ministry of Finance.
The fund was first established in 2017 under the administration of former President Abdullah Yameen. The fund was created as a fund to cushion the economy in times of crises and help to pay back loans taken for development projects. It is operated by finance generated from providing services at the country’s main airport.
A report issued by International Monetary Fund in 2020, noted that the Government had changed the dollars in SDF to Maldivian Rufiyaa. The fund is reported to have MVR 4 billion – the amount of dollars was not revealed.
In his last press conference, President Ibrahim Mohamed Solih was questioned about SDF. President Solih said that the fund was managed by Maldives Monetary Authority (MMA), the country’s central bank, and that most of the funds were already invested. He added that the cash in the funds were easily accessible.
The amendment bill states that the Sovereign Development Fund, a custodian account, must be established to facilitate sustainable investment of national funds, properly maintain public bank accounts, pay debts, and increase national earnings.
The bill tasks the President in determining how much is to be deposited to SDF and the strategies to invest and spend the SDF, under Finance Minister’s advice. It also mandates that a five-member Investment Committee also needed to be drawn up to manage SDF investments.
It also proposes that SDF should be administered under Finance Ministry, rather than MMA, adding that all legal, operational, and administrative aspects of operating this fund should be made.
An internal audit system is also prescribed in the amendment. This will be done through a seven-member committee, appointed by the Minister for a three-year term. The committee will be headed by a Chief Internal Auditor, who is once again, appointed by the finance minister.