Steps must be taken to manage debt: Finance Minister

Finance Minister Ibrahim Ameer has said that the State's debt must be managed by taking adequate action. The minister made the statement while addressing concerns raised by Parliamentarians at Wednesday's parliament sitting regarding the proposed budget for 2022.

Ameer said the revenue that the State anticipated could not be earned due to the global COVID-19 pandemic. As a result, the State had to depend on borrowings to run the government, he said. Therefore, the State must adopt fiscal consolidation measures to manage the debt, he said.

'We were forced to borrow as we were in the midst of an ongoing crisis. Most of our borrowings were not from a time when we had a normal economy. We were forced to borrow in crisis to address and manage said crisis. We now need to steer to a sustainable path,' the minister said.

By the end of 2019, Ameer said the State's guaranteed debt was 80 percent, and the percentage increased to 150 percent by the end of 2020. He noted that the State now hopes to bring down the debt to 105 percent of the GDP and decrease primary debt to 5 percent of the GDP.