World Bank lauds Maldives govt's measures to cut spending
Faris Hadad-Zervos said the government has been working to ease the financial pressures since the beginning of this year.
By
Ahmed Mizyal
Noting that the government has been cutting costs since the beginning of the year, the World Bank has welcomed the government's plans to reduce state expenditure.
Inaugurating a panel discussion on the World Bank's 'Scaling Back and Rebuilding Buffers' report on Maldives on Monday, the World Bank’s Country Director for Maldives, Nepal and Sri Lanka, Faris Hadad-Zervos said the government has already started taking measures, recognizing that Maldives is facing serious fiscal challenges.
The measures mainly include, according to Faris:
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Coordination of structural development projects
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Strengthen public investment management
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Decision to change the subsidy rule to targeted subsidies
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Strengthen health sector spending
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Reform of government companies
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Strengthening the use of public revenue
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Better practices in debt management and borrowing
"Both the current account and fiscal deficit are in double digits. Therefore, there is a need for quick and meaningful fiscal adjustments to reduce further risks," Faris said.
'Government has been cutting spending since the beginning of the year'
Faris said the government has been working to ease the financial pressures since the beginning of this year.
"Government spending has been reduced significantly. We are pleased to witness such measures being taken to get the economy back on track," he said.
In his speech at the meeting, Finance Minister Dr Mohammed Shafeeg said the government is ready to take necessary measures to manage the debt situation. The minister said the assistance of financial institutions would be needed to take these measures.
In his speech, Faris assured that the World Bank will continue to support the measures and changes taken by the Maldivian government.
