MMA invests USD140 mln to pay GMR over airport contract

Aircrafts at Ibrahim Nasir International Airport. PHOTO: MOHAMED SHARUHAAN/MIHAARU

Aircrafts at Ibrahim Nasir International Airport. PHOTO: MOHAMED SHARUHAAN/MIHAARU

Maldives Central Bank admitted Saturday that it had purchased a bond of USD 140 million from Maldives Airports Company Ltd (MACL) from the state reserve to aid MACL in settling its compensation with India’s GMR Group.

In response to Mihaaru’s inquiry after a press conference, Maldives Monetary Authority (MMA)’s Governor Azeema Adam disclosed that MMA invested USD 140 million in a bond sold by MACL, to be repaid within three years at an interest rate of 4.9 percent.

“MACL will pay [MMA] in Dollars every month,” said Azeema without revealing further details.

The previous government of Maldivian Democratic Party (MDP) under former president Mohamed Nasheed’s reign had handed over Ibrahim Nasir International Airport (INIA)’s operations to GMR Group for 25 years. Two years later, the government of former president Mohamed Waheed who rose to office following Nasheed’s fall from power, had taken back the airport from GMR as the agreement was debilitating to both MACL and Maldivian citizens.

GMR had filed the case at Singapore’s Arbitration Centre tribunal and the Maldives government had finally settled its compensation of USD 271 million with GMR Group over the broken contract last Tuesday.

At the time, the government had said the amount was settled by MACL. “This money was not paid from the state budget. But all the state institutions have given us generous aid,” Attornet General Mohamed Anil had said.

However, opposition parties have been claiming that the government had taken a hefty amount from state funds, thus drastically shrinking the state reserves.

Meanwhile, MMA’s statistics show that the state’s official reserves amounted to USD 541.4 million by the end of September with usable reserves at USD 193.8 million. This amount is a monthly increase of four percent, but a drop of 11 percent from last year.

Governor Azeema reassured that MMA will always maintain its reserve to cover the import of two months, adding that the central bank will not increase the US Dollar exchange rate.

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