MDP MPs meet MMA governor over dollar shortage
The MPs also called on the MMA to ensure businesses have access to foreign currency through the banking system without discrimination.
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The opposition Maldivian Democratic Party (MDP) Parliamentary Group has met Maldives Monetary Authority (MMA) Governor Ahmed Munawwar and Deputy Governor to raise concerns over the economy and measures being implemented to address the foreign exchange shortage.
Hulhumalé South MP Dr Ahmed Shamheed said on X on Thursday that the MDP delegation held discussions with the central bank leadership on the state of the economy and the availability of foreign currency.
Shamheed said the Parliamentary Group raised concerns over criminalising foreign currency transactions outside rates set by the MMA, arguing that such measures could push parallel market rates higher.
The MPs also called on the MMA to ensure businesses have access to foreign currency through the banking system without discrimination. According to Shamheed, the central bank gave assurances that dollar allocations would be made on an equal basis.
The meeting also covered amendments to the Foreign Exchange Act requiring resorts to convert 40 per cent of their foreign currency revenue through local banks.
The MDP delegation raised concerns over the impact of the requirement on resort operations and proposed tax relief to ensure businesses can meet expenses that must be settled in foreign currency.
The MPs also told the MMA that the foreign exchange shortage could not be addressed without measures to control state expenditure.
According to Shamheed, a share of the foreign currency received by the state is being used for external debt servicing and the requirements of state-owned enterprises. The delegation said pressure on foreign currency would continue unless the government cuts expenditure, manages debt and addresses the financing requirements of SOEs.
Concerns were also raised over access to dollars for the public. The MPs said directing foreign currency towards SOEs while restricting transactions outside the banking system could reduce the amount circulating in the wider economy.
The delegation noted that households require foreign currency for expenses including education, online subscriptions and other payments, and called for arrangements through banks to meet such demand.
The MPs also raised concerns over provisions restricting the publication of foreign exchange rates outside those set by the MMA, arguing that limiting media reporting would not address the shortage.
“Overall, today's meeting was a constructive discussion. The MMA provided assurances that arrangements will be made to ensure fair dollar support and that measures will be taken to prevent fraudulent Telegraphic Transfer (TT) transactions,” Shamheed said.
He added that the MMA had indicated it would monitor the effects of the measures and consider changes if they produced adverse consequences.
The meeting comes after Parliament passed amendments to the Foreign Exchange Act requiring resorts to convert 40 per cent of their monthly foreign currency revenue through banks. The amendments also introduced penalties for foreign currency transactions above rates set by the MMA and restrictions on publishing or promoting such rates.
The official US dollar exchange rate remains at MVR 15.42, while the parallel market rate has risen above MVR 22 amid demand for foreign currency.
