MALE, Maldives – As of September 14th, 2023, the finance ministry has confirmed that the Maldives' budget deficit has climbed to an alarming MVR 8 billion, marking an increase of MVR 2.2 billion from the same period the previous year.
In the same timeframe last year, the nation was grappling with a deficit of MVR 5.8 billion. This escalation of 2.2 billion rufiyaa within a year has raised eyebrows and serious concerns among the populace and experts alike.
From the start of the year until mid-September, the government's expenditure amounted to MVR 31.2 billion while only securing a revenue of MVR 23.2 billion. This yawning disparity in expenditure versus revenue intake has further exacerbated the budgetary concerns.
In a move that has drawn criticism and raised questions about fiscal responsibility, the government is considering submitting a supplementary budget. Such a step would stand in direct violation of the fiscal responsibilities act, which seeks to ensure transparent, accountable, and effective financial management within the country.
The situation becomes even more worrisome when viewed in light of the tax hikes introduced this year. Despite these hikes, the expected revenue targets fell short, casting doubt on the government's financial strategies.
Prominent economists have not held back their criticisms, with many pointing fingers at the leadership of President Ibrahim Mohammed Solih. The prevalent sentiment among these critics is that the increasing budget deficit is a testament to the administration's incompetence in managing the country's finances.