China 'green-lights' delaying Maldives loan repayments, president says
The central bank MMA said in March that it had no information that the loans owed to China had been restructured.
President Mohamed Muizzu said on Friday evening that the government of China has given the green signal that the Maldives will not have to pay the debt and interest it owes to China within the next five years.
He was speaking at an official function held at the Social Center in the capital city Male on Friday on the occasion of Independence Day.
Maldives owes USD 1.37 billion to China, including government sovereign guarantees, according to World Bank figures. This is 20% of the country’s external debt.
The President also highlighted some of the efforts being made by the government to improve the economic situation in Maldives.
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The Chinese government has given the green signal that it will not collect on the loans taken through China's Exim Bank for development projects in the past five years; the technical work is currently underway
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The Indian government recently deferred a USD 50 million debt owed by Maldives
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The UAE government has also deferred on its loan for the next five years
“.... We are working to implement the planned activities to manage the economy for the next five years and to ensure economic stability,” he said.
He added that despite this, in order to manage foreign debt and interest in the last eight months, the government has:
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MVR 3.8 billion has been paid so far without printing money
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No loan defaults
While the President said he had received the green signal that China would defer its debts, Chinese Ambassador to the Maldives Wang Lixin had said in May that China had no intention of delaying the repayments. The ambassador said at the time:
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If the debt is restructured, Maldives may not be able to borrow from China for new projects in the future
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Debt is handled with great caution; China does not want Maldives' debt to increase further
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Therefore, China is now giving top priority to its free aid projects in Maldives
President Mohamed Muizzu, arriving in Male after his China visit in January, said then too that he had received the green signal that China would delay the repayment of its debts for the next five years or make it as easy as possible.
However, the central bank said in March that it had no information that the loans owed to China had been restructured.
Foreign Minister Moosa Zameer met with China's Exim Bank during his visit to China last week at the invitation of Foreign Minister Wang Yi.
Zameer briefed the bank's Chairman Wu Fulin on the latest economic and financial information in Maldives. The two discussed President Muizzu's reform program and future cooperation with the bank.
