INVC NEWS
Male -Economic conditions in the Maldives have deteriorated significantly, leading President Mohamed Muizzu to take a 50% pay cut. Facing an economic crisis, Muizzu’s government is grappling with serious financial instability, partially stemming from strained relations with India.
President Muizzu lacks sufficient funds to pay government employees, as his administration has prioritized strengthening ties with China while distancing from India—a strategy that has negatively impacted the Maldives’ economic stability. Tourism, the country’s primary income source, has also been affected due to these diplomatic strains. To address the situation, the Maldives government recently announced several measures, including salary cuts for public sector employees.
According to a statement from the president’s office, Muizzu’s annual salary has been reduced from 1.2 million rufiyaa (approximately 6.57 million INR) to 600,000 rufiyaa (around 3.29 million INR), which is still double the average household income in the Maldives of 316,740 rufiyaa (about 1.73 million INR). Reports indicate that the government has exempted judges and lawmakers from salary reductions, though Muizzu hopes they will voluntarily accept a 10% reduction.
In response to the economic crisis, Muizzu has also canceled over 225 political appointments, including seven state ministers, 43 deputy ministers, and 178 political directors, a move expected to save around $370,000 per month. Despite the government previously stating in September that their financial issues are temporary and refusing assistance from the International Monetary Fund, the path to stabilizing the Maldives’ economy remains a significant challenge for Muizzu’s administration in the coming period.
