The International Monetary Fund (IMF) has emphasized the urgent need for the Maldivian government to implement its proposed fiscal reforms, warning that delays could further worsen the country’s economic and financial situation. The IMF called on national leaders to act swiftly in addressing mounting debt and fiscal deficits.

An IMF delegation, currently in the Maldives to assess the economic landscape, shared key findings with the Parliament's Joint Committee on Public Finance and Economic Affairs. Leading the delegation, Piyaporn Sodsriwiboon noted the positive growth in the tourism sector, highlighting that annual tourist arrivals surpassed two million for the first time last year, with a further 5% increase projected for this year.

Sodsriwiboon welcomed the government's economic reform agenda, stressing that subsidy reforms, Aasandha healthcare system adjustments, state-owned enterprise (SOE) restructuring, and reductions in state expenditure—including curbing currency printing—were critical to stabilizing the economy. However, she cautioned that time was running out for implementation, citing increasing external and internal pressures on the country’s fiscal stability.

She also identified the recent surge in infrastructure development projects as a contributing factor to the fiscal deficit. To address this, she recommended the reprioritization and rationalization of the Public Sector Investment Program (PSIP) to ensure sustainable financial management.

The IMF underscored the importance of aligning development projects and social programs with the country’s financial capacity, ensuring they deliver maximum benefits to the public without straining resources.

During the meeting, some Maldivian Democratic Party (MDP) members questioned the IMF’s stance on the Maldives’ three-point drop in the Corruption Perception Index (CPI). Sodsriwiboon responded by emphasizing the importance of state fiscal responsibility laws to enhance transparency and accountability in financial governance.

The IMF delegation was also asked about the USD 400 million currency swap facility secured from India last year. Sodsriwiboon acknowledged that the facility would offer temporary relief to the country’s fiscal and debt management efforts. However, she stressed the importance of financial buffers, especially when undertaking major economic reforms.

She reiterated that the first step to overcoming the financial crisis was recognizing its severity and committing to a concrete reform plan. She also emphasized the need to improve the business environment, strengthen governance systems, and invest in skill development to foster long-term, sustainable economic growth.

Meanwhile, the Finance Ministry has projected that without reform measures, an additional MVR 3 billion would be required to cover the budget deficit, pushing this year’s budget from MVR 57 billion to MVR 60 billion.