Gov’t Criticises Previous Administration’s Management of SOEs

Advisor to the Finance Minister, Ahmed Munawwar, has criticised the management of State-Owned Enterprises (SOEs) during the administration of former President Ibrahim Mohamed Solih, highlighting financial mismanagement that led to substantial debt accumulation. 

Speaking on Public Service Media’s ‘Raajje Miadhu’ programme last night, Munawwar revealed that the total debt of SOEs had reached MVR 98 billion.

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Munawwar stated that both the state’s debt and SOEs’ debts have increased significantly, with the government spending millions on maintaining these enterprises. He emphasised that the current administration has plans to cut costs at SOEs as part of its reform agenda.

“The total debt was MVR 32 billion by the end of 2022. That is direct loan debt. Including other liabilities, the total debt stands at MVR 98 billion. There are companies that have been run with fiscal indiscipline,” said Munawwar, who served as Finance Minister during former President Abdulla Yameen Abdul Qayyoom’s regime.

He recalled that during his tenure as minister, financial support provided to companies such as Fenaka was limited. “In 2018, Fenaka’s total debt was MVR 1.2 billion. However, it has increased to MVR 4.3 billion in 2023. This includes privately owned small companies as well,” he added.

Munawwar criticised the past five years’ management of companies, which he claimed were not operated with debt repayment in mind. He cited STELCO’s debt, which rose from MVR 2.8 billion in 2018 to MVR 3.8 billion by the end of President Solih’s administration in 2023, and Island Aviation’s debt, which quadrupled to MVR 4 billion.

He argued that companies should be able to manage their operations with their revenue but noted that SOEs are being managed with financial support from the state every month.