MDP President and former Foreign Minister Abdulla Shahid has said that the Maldives Monetary Authority (MMA) investing in government Treasury Bills through the Pension Fund amounts to direct money printing by the government, and that this will damage the country’s entire financial system.

Shahid said that the MMA’s investment in government T-bills via the Pension Fund is outright money printing, which will drive up inflation, further weaken the Maldivian rufiyaa, make dollars harder to obtain, and push the dollar’s price to extreme highs.

He added that pushing through the printing of 2.4 billion rufiyaa — despite ongoing resignations of Pension Office board members and senior staff — is a clear act of destroying both the people’s future and the country’s entire financial system.

Shahid also called it deeply disappointing that President Dr. Mohamed Muizzu, who had pledged not to print money, has broken that promise and is proceeding in a manner that could cause such significant harm to the financial system.

His remarks come after Pension Office board member Ahmed Sarwash Adam resigned over a transaction in which 2.4 billion rufiyaa in Treasury Bonds held by the Pension Fund are being sold to the MMA through the secondary market, with the proceeds then reinvested into a new government bond. In his resignation letter, Sarwash noted that the transaction risks expanding the money supply and driving up inflation, and that although it is being carried out through the secondary market, the end result is effectively the same as the central bank directly lending to the government.