Dollar shortage falls under MMA's mandate, not economic ministry's, says Saeed

Minister of Economic Development and Trade Mohamed Saeed has said responsibility for addressing the Maldives' foreign currency shortage lies with the Maldives Monetary Authority (MMA), rather than his ministry, arguing that the central bank is legally mandated to formulate and implement foreign exchange policies.

Saeed made the remarks during Wednesday's parliamentary sitting while responding to a no-confidence motion submitted by the opposition Maldivian Democratic Party (MDP) seeking his removal from office.

The motion, submitted to Parliament in August and signed by 13 members of the MDP parliamentary group, raised several concerns about Saeed's performance, including the shortage of US dollars in the domestic market.

The opposition argued that businesses and individuals were struggling to obtain dollars at the official exchange rate, while prices in the parallel market had increased substantially.

The motion also alleged that Saeed had failed to implement economic reforms within his ministerial mandate to address the foreign currency shortage.

Responding to the allegations, Saeed said he had examined the relevant legislation to determine which institution was responsible for managing the country's foreign exchange system.

"The first question raised in the motion concerns this issue. To answer these questions, I wanted to examine the laws, because it is this honourable Parliament that passes legislation. We are working within that legal framework," he said.

Saeed cited Section 24(a) of the Maldives Monetary Authority Act, stating that the legislation assigns responsibility for implementing the exchange rate system and formulating and executing exchange rate policies to the MMA.

He maintained that the responsibility rested with the central bank and could not be assigned to another institution under the existing legal framework.

The minister suggested that the MDP parliamentary group could direct its questions on foreign exchange policy to the MMA.

Despite maintaining that foreign exchange policy falls under the MMA's mandate, Saeed defended the government's measures to improve dollar availability.

He claimed that the amount of US dollars sold at the official exchange rate had increased substantially under President Dr Mohamed Muizzu's administration compared with the previous government led by President Ibrahim Mohamed Solih.

According to figures presented by Saeed, dollar sales at the official exchange rate during the previous administration included USD 253.8 million in 2021, USD 379.2 million in 2022 and USD 442.56 million in 2023.

He said dollar sales under the current administration amounted to USD 486.53 million in 2024, USD 733.82 million in 2025 and USD 718.53 million so far in 2026.

Saeed stated that the total amount sold during the three years under the previous administration was USD 1.75 billion, compared with approximately USD 1.9 billion under the current government.

He claimed the figures represented an increase of 80% in dollar sales at the official rate, with the monthly average having almost doubled.

However, the individual annual figures he cited for 2021 to 2023 total approximately USD 1.08 billion, rather than USD 1.75 billion. The figures for 2024 to 2026 total approximately USD 1.94 billion.

The minister said the dollar sales included telegraphic transfers for businesses, foreign currency provided for Hajj and Umrah, overseas education and medical treatment, and allocations for Maldivians travelling abroad.

He questioned the opposition's claim that the government had failed to address dollar availability, arguing that more foreign currency was being made available through official channels.

Saeed attributed the increase in dollar availability to measures introduced by President Muizzu's administration, including requirements for tourism businesses to exchange a portion of their foreign currency earnings through the domestic banking system.

He highlighted the requirement for tourism businesses to exchange 40% of their revenue in US dollars as an example of the government's efforts to improve access to foreign currency.

The minister praised President Muizzu for introducing the measure, saying the administration had prioritised the needs of ordinary citizens.

He also criticised the previous MDP administration's handling of the foreign exchange situation, describing the challenges inherited by the current government as the result of earlier policies.

Saeed maintained that the opposition's allegations concerning dollar availability did not reflect the government's efforts to increase foreign currency supply through official channels.