The Chinese government has agreed to initiate the steps necessary to restructure the Maldives’ direct debt to the nation, and talks are scheduled to begin soon, President Mohamed Muizzu has confirmed.

Speaking to the media at Velana International Airport upon his arrival in the Maldives after completing his official visit to China, the President said that Chinese President Xi Jinping agreed to the proposal during official talks between the two countries.

“When I presented it to the Chinese President during our official talks, he immediately designated a technical team to travel to the Maldives shortly to discuss the matter of [restructuring] Maldives’ debt to China with the relevant officials,” he said.

The President said he is discussing ways to extend the grace period over the next five years and to pay the money in a manner that would be as less burdensome as possible within his term. He said that there would be a significant easement once discussions are underway for the matter to be, then, finalised.

“[China] will soon send a technical team from the finance ministry and the finance sector to study and determine [easy ways to repay the debt]. That was also arranged. And we look forward to significant easements to proceed with the [outstanding] loans,” Muizzu said.

While the President referred to the Maldives’ direct debt to China, no specific figures were provided.

According to the Ministry of Finance, there are no direct debts to the Chinese government; however, the largest debt—which stood at MVR 8.1 billion as of the third quarter of 2023—is owed to the Export-Import Bank of China, which is a 100 percent Chinese government-owned company.