State debt as a share of GDP is expected to fall from 9.9 per cent in 2024 to 5.5 per cent by the end of 2025, significantly improving the country’s fiscal outlook, Minister of Finance and Planning Moosa Zameer has said.

Speaking at the MSME Awards 2025, Minister Zameer highlighted that economic activity has increased steadily, driven largely by small and medium enterprises (SMEs), which he described as central to expanding revenue and supporting financial sustainability. He noted that SMEs are now contributing a substantial portion of the State’s annual tax income, helping to fund essential public services and national development programmes.

The Minister also underscored that, for the first time since 2021, no supplementary budget had been submitted, with the Government managing to maintain expenditure strictly within the limits approved by Parliament. He added that the budget has remained in surplus for 40 consecutive weeks, supported by stronger cash flow management, reductions in wasteful transport and repair costs, and consistent repayment of outstanding loans. Minister Zameer added that the Sovereign Development Fund has exceeded USD 100 million for the first time, a milestone he described as crucial for strengthening future economic resilience and reflected in Moody’s recent outlook upgrade for the Maldives.

Outlining steps to reinforce fiscal discipline, Minister Zameer said the Government is strengthening legal frameworks through legislative updates, and is preparing a medium-term debt strategy to ensure sustainable debt recovery. Work is also underway to list a Shariah-compliant bond as part of efforts to diversify financing instruments.

Addressing domestic economic growth, the Minister emphasised the importance of building local skills and value addition rather than relying on import-driven models. He said the Government recently awarded over 200 projects worth MVR 2.7 billion to 53 local companies, aiming to increase Maldivian participation in sectors traditionally dominated by foreign contractors. This, he said, will help ensure that a larger share of State investment remains within the local economy.

Minister Zameer also announced key initiatives focused on strengthening SME access to finance. With support from the Islamic Development Bank Group, a USD 40 million e-impact fund has been established, with the first USD 10 million tranche already disbursed through an Islamic financing facility operated by SME Digital. He reiterated the Government’s objective to ensure SMEs are among the main beneficiaries of national economic development.