Nasheed welcomes Sukuk repayment without new borrowing
The government confirmed that the payment was made ahead of the deadline, which had been set for the 8th of this month.
Former President Mohamed Nasheed has stated that the government’s settlement of the Sukuk issued in 2021 without taking on additional debt is encouraging.
In a post on X on Thursday night, Nasheed referred to the repayment of $524.68 million (MVR 8 billion) due under the Sukuk issued during the administration of former President Ibrahim Mohamed Solih.
The government confirmed that the payment was made ahead of the deadline, which had been set for the 8th of this month.
According to a statement issued by the Ministry of Finance, the total payment includes the principal amount of $500 million and $24.68 million in interest.
The Ministry stated that the repayment was made using funds from the Sovereign Development Fund (SDF) and state reserves.
It added that the settlement is expected to reduce the debt-to-GDP ratio.
The Sukuk was issued in 2021 to refinance a $250 million bond. The Ministry stated that the Sukuk carried a high interest rate and was undertaken without a repayment plan.
The government has since resumed deposits into the SDF. The fund had been drawn down during the COVID-19 pandemic.
In 2024, the administration revised the Airport Development Fee to increase inflows to the fund. The Ministry stated that the changes did not increase costs for Maldivian travellers.
Following these measures, the foreign currency balance in the SDF exceeded $350 million. The Ministry also reported that state reserves reached $1.3 billion by the end of March.
The Ministry stated that further work is ongoing with financial institutions to secure additional financing.
The government had maintained that the Sukuk would be repaid by the deadline despite concerns raised over the country’s debt position.
