Maldives settles $500 million Sukuk, cites stronger reserves and debt outlook
Finance Ministry said the repayment was made through the Sovereign Development Fund (SDF) and other foreign currency balances.
Maldives has completed the repayment of the USD 500 million Sukuk issued in 2021, paying both the principal and associated coupon, as it moves to reduce public debt and strengthen fiscal stability.
In a statement Thursday, the Ministry of Finance and Planning said the repayment was made through the Sovereign Development Fund (SDF) and other foreign currency balances. The total amount paid included the USD 500 million principal and a coupon payment of USD 24.68 million.
The ministry said the settlement had allowed the Government to reduce its debt stock and improve debt sustainability indicators.
“The Government has successfully settled the USD 500 million Sukuk issued in 2021, and thereby managed to reduce its debt stock by utilising the Sovereign Development Fund, and other foreign currency balances,” the statement said.
The ministry said the Maldives had faced major fiscal and external pressures following the Covid-19 pandemic and the external shock caused by the Russia-Ukraine war in 2022. It said a series of measures introduced since 2024 had helped stabilise the situation.
According to the statement, these measures included revenue reforms focused on foreign currency income and monetary policy changes introduced by the Maldives Monetary Authority, including the Foreign Currency Act and regulations requiring the conversion of foreign currency earnings.
The ministry said these steps had “structurally strengthened the external sector position”, adding that Gross International Reserves reached record levels at the end of March 2026. It also said the same policy measures supported the build-up of liquid foreign currency balances in the SDF, which helped facilitate the Sukuk repayment.
“Indeed, the successful repayment of the Sukuk was facilitated by the prudent policies undertaken by the Government since 2024,” the statement said.
The Government said the economy had been expected to record a strong fiscal year in 2026, with real GDP growth projected at 5.3% in the state budget. It attributed this to infrastructure developments including the completion of the new passenger terminal at Velana International Airport and the upgrade of Hanimaadhoo International Airport.
The ministry also said the Government had recorded its highest-ever revenue collections in the first quarter of the year, supported by record tourist arrivals.
However, it warned that recent developments in the Middle East and their impact on global energy and commodity markets could affect growth and the broader macro-fiscal outlook over the medium term.
Despite these risks, the Government said it remained confident in its ability to maintain fuel availability, public services and economic activity.
“The Government remains confident in its ability to facilitate the availability and continuous supply of fuel to meet demand, and ensure the provision of public services and uninterrupted economic activity,” the statement said.
The ministry said the Government continued to have access to existing multilateral trade financing facilities to meet annual energy requirements and was also working with multilateral partners to secure additional financing for fuel supplies.
Following the Sukuk repayment, the Government said debt sustainability indicators had improved significantly. It added that any future borrowing would be aligned with fiscal and debt sustainability priorities.
“Looking ahead, the Government is committed to ensuring any additional borrowing will be aligned with Government’s priorities to safeguard fiscal and debt sustainability,” the statement said.
The Government also said it had recently completed the rollover of a bilateral bond and was continuing discussions with bilateral partners to reduce refinancing risks and meet additional financing needs.
The ministry said rising global energy prices were likely to increase expenditure pressures, but noted that a set of fiscal policy measures was being prepared to reduce the impact of the global energy crisis on vulnerable groups.
It added that the Ministry of Finance and Planning would continue to monitor the macroeconomic situation as global conditions evolve.
“The Ministry of Finance and Planning continues to assess the macroeconomic situation, and the Government remains committed to ensuring macro-fiscal stability despite the evolving challenges in the global economy,” the statement said.
