The Maldives’ usable dollar reserves have reportedly run out for the first time in the nation’s history, according to local media reports on Wednesday. This alarming development comes after the Monetary Authority of Maldives (MMA) warned that the government’s reserves could be exhausted by the end of August.
The MMA and the Finance Ministry have not commented on the matter. However, local media outlet Adhadhu reported that multiple sources confirmed the state’s remaining dollar reserves have been fully depleted.
Two independent and reliable sources told Adhadhu that the usable dollar reserves are currently in the negative. A source familiar with the government’s finances disclosed that a US$25 million oil bill, due on Monday, had to be settled without delay. The payment, made on Wednesday, reportedly pushed the reserves into negative territory.
The reserves are typically used by the government to pay off loans and fund essential imports. They include dollar revenue from the Maldives Inland Revenue Authority (MIRA), state grants, and budget support.
According to the latest figures released by the MMA, the usable dollar reserves stood at US$43 million at the end of July, just enough to cover one month’s expenses.
Analysts suggest the government’s next recourse may involve tapping into the Sovereign Development Fund (SDF), established to assist with external debt payments.