Maldives economy expands by 30% in last five-year period

Photo: Maldives Customs Service

The Maldivian economy has expanded by 30% in the last five years with overall productivity of the country hitting MVR72 billion, according to government.

While addressing at the Maldives parliament to announce forecast budget for 2019, Finance Minister Ahmed Munavvar recalled the country’s productivity hit MVR53 billion in 2013 but expected the value to hit MVR73 billion at the minimum.

Finance Minister while addressing the parliament said, “this indicates the rapid pace at which the country’s economy has been growing and shows that it has expanded than before.”

Further noting the country’s economic prosperity, the finance minister was keen to highlight the doubling up of Maldives reserve from USD300 million five years back to USD600 million in 2018.

Emphasizing on other prominent aspects in the country’s economy expanded, finance minister also stressed on the significant growth in tourism sector while he drew parallels between Maldives Monetary Authority’s decision to slice up the minimum reserve requirement leading to the growth in construction sector.

The economical growth is expected to be a growing pace of 6.8% in the coming year.

“The economical growth rate will become constant halfway through, yet the developmental pace will still be faster in comparison to other developing nations. IMF expects economic growth rate to be around 3.8% for every other country next year, while developing countries will experience a constant 5% growth rate,” Minister Munavvar explained.

The Maldives Finance Ministry proposed forecast budget for 2019 also indicates the country’s consumer price index or inflation rate to recede into negative figures.

“… meaning the price on goods will continue to recede, while the inflation rate will stay around 0.1% in 2019. The visible price deflation comes mainly due to new policies introduced to slice price on goods.” The finance minister continued further.

The forecast budget for 2019 comprises of MVR26.7 billion as government’s total expenditure with MVR2.9 billion allocated specifically to clear debts. Maldives state expects grants or free aids along with revenue to hit MVR23 billion while budget deficit will reach MVR3.7 billion.

The budget deficit marks a 4.7% based on the country’s Gross Domestic Product (GDP).

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