Maldives Anticipates a Potential MVR 50 Billion Budget for 2024
It predicts a budget of up to MVR 50 billion for 2024, considering factors such as baseline expenditure, cost-saving measures, and new projects and programs.
As the end of the year approaches, one of the most awaited announcements in the Maldives is the unveiling of the budget for the upcoming year. The budget for 2023 stirred shock and surprise when the government revealed a substantial figure of MVR 42.8 billion. The intent behind this budget was clear: to facilitate positive changes and aid in the complete recovery of the economy, which had been significantly impacted by various challenges.
The Ministry of Finance, in its statement outlining the state's medium-term fiscal strategy submitted to the parliamentary finance committee, has provided a glimpse into what the financial landscape might look like in the coming year. It predicts a budget of up to MVR 50 billion for 2024, considering factors such as baseline expenditure, cost-saving measures, and new projects and programs. While this is not the confirmed budget announcement, it is a noteworthy projection that would signify a 5.3 percent increase compared to the 2023 budget.
Several key factors contribute to the potential for a larger budget in the upcoming year:
- Expenditure Expansion: Forecasts indicate that expenditures are poised to reach a substantial MVR 48 billion in the following year. This suggests that the government is planning to allocate more resources to various sectors and initiatives, potentially contributing to economic growth and development.
- Budget Deficit: It is estimated that the total budget deficit for 2024 could reach MVR 9.8 billion, equivalent to 8.5 percent of the state's per capita income. This suggests that the Government would need to raise MVR 13.4 billion to finance the budget for 2024.
- Austerity Policies: The government is planning to implement austerity policies to streamline spending. These measures aim to curtail expenses and bring the total government spending down to approximately MVR 44 billion. Austerity measures can help ensure efficient utilization of resources and reduce unnecessary expenditures.
- Cost Increases: In the medium term, costs are projected to increase. This reflects the evolving economic landscape and the need to allocate resources to address new challenges and opportunities.
With the potential budget for 2024 being set at MVR 50 billion, there is still hope that the upcoming Government would commit this budget to stimulating economic growth, enhancing public services, as well as addressing some key critical issues in the Maldives. While the actual budget announcement has not being made yet, the predicted increase may be a reflection of a broader vision by the Governing body for the coming year.
