The opposition Maldivian Democratic Party (MDP) has said that debt monetisation was not halted by the Mohamed Muizzu administration, contrary to the administration’s stated claims.

Ahmed Easa, the MDP spokesperson for its ‘Misraabu hama magah!’ parliamentary campaign and sitting Member of Parliament for Kendhikulhudhoo, told a press conference that the claim made by the Muizzu administration, stating that they put a stop to debt monetisation, was a lie on the president’s part.

It was the decision of the previous, MDP-led, Ibrahim Mohamed Solih administration, he said.

“If you look at the official state documents, the documents of the Ministry of Finance, the decisions of the President’s Office and the decisions of the Parliament, you will see that the MDP administration decided not to continue with debt monetisation during November 2022 and for the practice to end completely by 31 December 2023,” Easa said.

President Muizzu assumed office on 17 November 2023.

Easa characterised the decision as one made by the MDP administration that came into force during President Muizzu’s term.

During his visit to Addu last month, President Muizzu reiterated that his administration had halted debt monetisation, going on to say that his administration had inherited a debt of MVR 120 billion when it took office. He also noted that debt monetisation in the past five years had been higher than in the previous 40 years combined.

“A total of MVR 8 billion was debt monetised in the last five years,” he had said while sharing with rally attendees, on 16 December on the occasion of Huravee Day, that his administration had halted the practice.

Certain provisions of the Public Expenditure Accountability Act were suspended in April 2020 due to the Covid outbreak, allowing more leeway for the Solih administration to carry out debt monetisation. The deadline to halt the practice was extended by the MDP-dominated parliament until December 2023 on 23 November 2022.