Central bank to resolve foreign currency issues in stages

Maldives’ Governor Ali Hashim has stated that central bank, Maldives Monetary Authority (MMA) would address the foreign currency issues in the Maldives step by step, in order to avoid any resulting negative impacts on the country’s economy.

Speaking at the Parliament’s Public Finance Committee on Tuesday, Governor Ali said while steps will be taken cautiously to resolve foreign currency issues, one of the main purposes of such a strategy is to identify any impacts on the economy and address it accordingly. He said that new regulations will be established under the MMA Act, and that changes will be brought to the legal framework. Changes will also be brought to the exchange rates set by the central bank, which in turn would mean changes to the licensing system, he added.

Governor Hashim said the central bank would try to maintain the current exchange rates set by the bank in bringing any changes to existing laws and regulations. In this regard, it will be mandated that local transactions are carried out in local currency, including account transfers. Maldivian currency must be used for exchange purposes, said the governor.

Noting that the establishment of the payment system would bring together all aspects of foreign currency exchange and local transactions, Governor Hashim said the monitoring mechanisms will be strengthened with the establishment of the system. However, it would be challenging for only MMA to work on resolving the existing issues, and the engagement of the Finance Ministry, the Tourism Ministry and all stakeholders is important in bringing about changes, he added.