Zayan, representative of Finance Ministry on MMA’s board, resigns

Ahmed Zayan Mohamed, who represents the Finance Ministry on the board of the Maldives Monetary Authority (MMA), has tendered his resignation.

The resignation comes with the government working on raising MVR 15 billion by selling a plot of land from Hulhumale’ to MMA.

A credible source confirms to Sun that Zayan, the head of the Fiscal Affairs Department tendered his resignation to the Finance Ministry on Monday. He is currently on notice, and will work until May 15.

He will be automatically removed from the board of MMA once his notice period is over.

The Finance Ministry has not made an official comment regarding Zayan's resignation.

During his 2023 presidential campaign, President Dr. Mohamed Muizzu vowed he would never print money, as his predecessor had resorted to during the Covid-19 pandemic. He repeatedly reiterated this pledge after coming to power, and listed avoiding printing money as one of the biggest achievements of his administration in its first year.

However, Sun has been informed that the administration is engaged in negotiation on selling a large plot of land from Hulhumale’ that is under the management of the Housing Development Corporation (HDC) to MMA for a price of MVR 14 billion – MVR 15 billion.

On Sunday evening, President Muizzu hosted lawmakers from the ruling PNC at the presidential palace, Muliaage, and discussed the plan.

“The president emphasized that it does not constitute as printing money,” said a PNC lawmaker who attended the meeting.

However, money printing or monetary financing is the practice of a government borrowing money from the central bank to finance public spending instead of selling bonds to private investors or raising taxes. It is not limited to the act of physically printing money.

Some economic analysist who spoke to Sun believe the administration is working on raising money to repay the staggering debt obligations due this year.

According to data shared by former President Mohamed Nasheed, the Maldives has a staggering USD 800 million (approximately MVR 12 billion to MVR 13 billion) in debt repayments due this year. This includes USD 150 million due by the end of March, and another USD 25 million in April.

Nasheed warned that by increasing the money supply by billions, the US dollar exchange rate is likely to surge well over MVR 24, consequently fueling inflation. He urged the administration revert to fiscal consolidation to reduce the budget deficit.

The MDP administration had printed MVR 8 billion due to the economic downturn during the Covid-19 pandemic. The former administration claims it resorted to printing money because it was left with no other choice to a complete cease in economic activity after the country’s airports were shut down.

But the move was widely slammed by the PNC administration in the past.

On Monday, the MDP accused the PNC administration of pushing the country’s economy to the brink of an economic disaster with its plan to print MVR 15 billion.