Gov’t to set up special fund to establish an US Dollar reserve-Naseem

Minister of Foreign Affairs, Ahmed Naseem has said that the government prompts to set up a special fund to establish an US Dollar reserve to find a permanent solution for the dollar shortage crisis in the country.

In a press conference held yesterday at the Ministry of Foreign Affairs, Minister Naseem said that the government is now currently in the administrative phase to set up this fund. He said that once this is done it will be established without delay.

Minister Naseem said that the US Dollar black-market not only cause loss to the poor buyer but also to those selling US Dollars.

Furthermore, Minister Naseem also noted that similar US Dollar shortages were faced by Seychelles some years back. He said that the price of the US Dollar hiked in Seychelles for about 23 rupees per US Dollar but the preventive measures taken by Seychelles helped its economy to prosper.

Meanwhile, President Mohamed Nasheed, in his weekly radio address on last Friday, speaking publicly for the first time after the implementation of a managed floating exchange rate, expressed optimism of an early stabilizing the exchange rate below the median of the band of fluctuation allowed for the exchange rate of Rufiyaa against US Dollar.

The government, in consultation with the Maldives Monetary Authority (MMA), the country’s central bank, on 10 April, decided to float the Rufiyaa, allowing it to be exchanged for US Dollar within 20 percent of pegged rate of Rf12.85 to US Dollar.

Sharing the optimism expressed by the Minister of Finance and MMA following the government’s decision, the President said “we will begin to see the positive signs of economy stabilizing within next three months.”