The Government of Maldives has refinanced USD 75 million of a USD 378 million loan originally taken from China’s Export-Import (EXIM) Bank in 2015 for the expansion and upgrade of Velana International Airport (VIA).

Loan refinancing involves securing a new loan to repay an existing debt, shifting the terms of the original loan to the new one.

The refinancing agreement for this loan was formalized on September 23rd.

Details of the refinancing were revealed during a meeting of the Parliament’s Public Accounts Committee on Monday, where a letter from the Finance Ministry was disclosed.

According to the letter, a refinancing agreement for USD74,767,599.98 has been signed.

The first interest payment on the new loan is due on January 21, 2025, with subsequent bi-annual interest payments scheduled for every January 21st and July 21st.

The loan carries an interest rate of two percent, amounting to USD 3.3 million.

The refinanced amount is to be repaid over six years, including a three-year grace period.

Full repayment is scheduled for completion in 2030, and the original loan was taken under non-conditional terms.

The Finance Ministry explained that the primary objective of refinancing the loan is to alleviate the financial burden on the government in managing short- and mid-term debts.