Zameer says USD supply raised by USD 89.3m to stabilise prices amid global shocks

Dollar sales to businesses increased by USD 89.3 million in the first quarter of this year compared to the same period last year, Finance Minister Moosa Zameer said on Sunday.

Zameer told a press conference that the Maldives Monetary Authority (MMA) and the Bank of Maldives (BML) have jointly arranged measures to improve access to foreign exchange and strengthen the economy. The briefing was held to outline the government’s response to the war that began in the Middle East on February 28.

He said the conflict has caused major disruptions in the global market, and the government has increased the supply of dollars to businesses to curb sudden price hikes in Maldives.

“This includes the revenue generated internally by the Bank of Maldives and the money released by the government through the MMA for intervention,” Zameer said.

According to the figures, businesses purchased USD 16.9 million for TT payments in the first quarter of last year, an average of USD 5.6 million per month.

In the first quarter of this year, the figure rose to USD 106.2 million, averaging USD 35.4 million per month. From January to January 16 alone, USD 25.2 million was sold.

The amount issued to cards also increased in the first quarter of this year. The figure rose to USD 119.8 million from USD 78.7 million in the same period last year, an increase from an average of USD 26.2 million to USD 40 million per month.

“The result is not a price shock but a change in freight in the international market, for example,” Zameer said.

He said the government is working with BML and other banks to issue funds to ease the immediate difficulties faced by businesses.

In March and April, MVR 163 million was disbursed, while a total of MVR 541 million was issued to the tourism sector, he said. MVR 941 million has been disbursed to the construction sector, other sectors, and private individuals.

“Therefore, without stopping the economy, the government is doing what it can through our National Bank,” he said.

Maldives’ debt has increased, and the rising value of the dollar raised concerns among businesses last year. In July, the MMA decided to increase by 10 percent the proportion of US dollars issued to banks for commercial purposes, including TT and LC payments required for imports.

Since then, commodity prices have risen. President Dr Mohamed Muizzu has accused private traders of selling some items at higher prices for political purposes.

The government has said it is confident that essential supplies will remain uninterrupted, even as businesses and the public express growing concern over the impact of the war.