Maldives requires a 2 year grace period to repay debt to China: Nasheed

Chinese Ambassador Zhang Lizhong meets with Former President and Speaker of Parliament Mohamed Nasheed. : Photo - Majilis

Male’, Maldives – The former President of Maldives and the current Speaker of the Parliament, Mohamed Nasheed has said that Maldives needs a further 2 year grace period, or the country would never be able to repay the country’s debt to China.

He said this in a tweet replying to Zhang Lizhong, Chinese Ambassador to Maldives who has followed up with some research of his own after refuting Nasheed’s earlier claims that Maldives needs to pay $15 Million to China within the next 14 days.

Ambassador Zhang has said that his research has revealed that for 2020, the payment due to China is USD 1,719,535. He also noted that for the Hulhumale phase II 1530 housing unit, USD 2,375,000 is due to a non-Chinese third party bank, and not to the Chinese Development Bank (CDB). He further added that, for the STELCO power project, the earliest next due payment is in the middle of January 2021.

Replying to this, Nasheed said that he values the friendship Maldives has with China, and asked the Ambassador to not wait till the 11th hour to settle the ongoing debt issues.

Ambassador Zhang responded to this an hour later, reiterating that China is already discussing with Maldivian authorities to solve the debt problem and added that ” with joint efforts, there will be a proper and mutually-beneficial arrangement to inject more impetus to economic recovery.”

Nasheed and Zhang have been exchanging words on twitter quite frequently on the topic of the Maldivian debt to China. These series of tweets started after Nasheed claimed yesterday that China did not give any leniency to any of the large debts Maldives owes to them and that the $15 Million that Maldives is required to pay to the Chinese banks within the next 14 days is almost 50% of total state revenue.

However, disproving these claims, Ambassador Zhang stated on twitter that according to feedback from Chinese banks that the Maldives is indebted to, there is no such payment due in the next 2 weeks. His tweet ended with a word of advice to Nasheed asking him to “check the account book” and to save the $15 million for the 2021 state budget.