Currency substitution or de-dollarization will be implemented in the Maldives next year, the central bank, Maldives Monetary Authority (MMA), has said.
Speaking at the Parliament Budget Committee on Sunday on the proposed budget for 2022, Governor Ali Hashim said discussions are ongoing with relevant authorities regarding introducing the de-dollarization policy. He said the initial meetings were with the banking sector, and two foreign exchange licensing and monitoring regulations were established during these meetings.
''Currently, we are in the process of explaining the details in the regulations to stakeholders, the Economic Ministry, the Finance Ministry, and policymaker before pursuing discussions with the private sector," the governor said.
Speaking at the budget committee, Deputy Governor Ahmed Imad said implementing the de-dollarization policy was delayed due to economic fallout caused by the COVID-19 pandemic. Relevant authorities advised to implement the policy after considering the rate of economic recovery, he said.
"For a long time, this has been a significant issue, and what we seek now will provide a more permanent solution. Hopefully, at the beginning of next year, we will implement this policy divided over phases. We are receiving cooperation from enforcement agencies," Imad said.
The current administration has pledged to bring an end to the dollar black market. However, the steps taken towards achieving the goal have not been announced by either the government or the central bank.