Budget shortfall leads Maldives to seek $US29.4 million Bank of Ceylon loan
17 Aug 2013, 5:02 PM
Leah Malone
President Mohamed Waheed has requested parliament approval to obtain a US$29.4 million loan from the Bank of Ceylon to finance the government’s budget and manage cash flow.
The Ministry of Finance and Treasury is seeking to secure the loan as a way to “enforce” the 2013 budget approved by parliament, stated a letter from the President’s Office read during a parliament session held on Tuesday (August 13).
The Finance Ministry informed the President’s Office that the Bank of Ceylon would provide the Maldives’ government a loan of US$29.4 million, at a six percent interest rate, to be repaid within six years in monthly payments of US$490,000, according to local media.
The Government of Maldives believes the short term loan offers “good terms” and will provide the support necessary to finance the state budget and cash flow. The President’s Office letter also noted that the graduation of the Maldives from least developed country status has made it “extremely difficult” to obtain loans with low interest rates.
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