Parliament has begun debating the Sovereign Development Fund (SDF) Bill. The legislation, proposed on 10 June, was introduced on behalf of the administration by Ali Fazad, Member of Parliament (MP) for Central Fuvahmulah.

The Bill seeks to establish legal structure in the use of the SDF and rules governing its management.

The Fund was originally established to ensure repayment capacity and certainty with regard to the state’s external debt by accumulating and maintaining foreign currency for debt repayment while also providing the country with reserves in cases of sudden economic shock.

Collections for the Fund are made up of receipts from airport development fees, 10 percent of the state’s income as dividends from state-owned enterprises (SOEs), fees from the issuance of sovereign guarantees, as well as other funds the President may deem to be deposited on the advice of a Governing Council.

According to the bill, the President will determine the amount to be deposited in the SDF on the advice of a Governing Council, taking into account the total external debt of the nation.

The bill was originally proposed by the current administration during the previous 19th parliamentary session, where it faced rejection.