Male’, July 31, 2018— The Maldives and the World Bank Board today signed a $12 million agreement to further strengthen the Maldives public sector financial management systems. Building on the existing Public Financial Management Systems Strengthening Project, the additional financing approved today will help improve planning and budgeting, debt and cash management, financial reporting, procurement, and State‐Owned Enterprise monitoring and oversight.
Dr. Idah Pswarayi-Riddihough, World Bank Country Director for Sri Lanka and the Maldives and Hon. Ahmed Munawar, Minister of Finance signed the project on behalf of the World Bank and the Government of Maldives respectively.
The Ministry of Finance and Treasury has made progress with reducing the fiscal deficit from 10.6 percent of GDP in 2016 to 2.5 percent in 2017 with improvements in revenue collection and a shift from recurrent to capital expenditure to support public investments. It has also improved the trustworthiness of its budgetAn integrated financial management information system rolled out by the Ministry has improved the quality and access of financial information and the Auditor General has taken progressive steps to disclose audit reports on public debt and guarantees.
“Financial transparency and accountability are key factors to improve public service efficiency” said Idah Z. Pswarayi-Riddihough, World Bank County Director for Sri Lanka and Maldives, commending the Government of Maldives for its commitment to macroeconomic and fiscal reforms.
The expected results of the additional financing include: stronger preparation and prioritization of high impact and affordable public investments, optimized cost and risks of public debt, and improved public procurement. The modernization of these core public financial management functions aims to ultimately improve the effectiveness and efficiency of public services.
“Greater citizens engagement is a defining factor of this initiative, which includes greater disclosure of budget information and financial accounts as well as participatory audits,” said Fabian Seiderer, World Bank Lead Public Sector Specialist and Task Team Leader of the project.
The project will be funded by an International Development Association (IDA) grant and credit and implemented over the period of four years.