The government has completely phased out subsidies previously paid to the Maldives Industrial Fisheries Company (MIFCO) for purchasing fish, with reforms in the fisheries sector beginning to deliver positive results, according to Minister of Fisheries, Agriculture and Ocean Resources Ahmed Shiyam.
The minister made the remarks while responding to questions from Members of Parliament on issues related to the fisheries sector.
Shiyam said long-standing government policies need to be reformed to increase fish exports, noting that the Maldives had relied on a single processing factory in Felivaru for around 40 years without sufficiently expanding national processing capacity.
He said that when the previous administration increased the fish purchase price to USD 1.62 per kilogram, the government had to provide MIFCO with a subsidy of USD 0.84 per kilogram to maintain that price. According to the minister, the subsidy cost the state billions of rufiyaa each year.
Shiyam said those funds could have been invested in expanding fisheries infrastructure instead. He added that projects currently under way across the country are expected to increase the Maldives’ fish processing capacity threefold from its current level of 105 tonnes.
The minister said reforms introduced by the government, together with operational improvements at MIFCO, have enabled the subsidy for fish purchases to be eliminated entirely.
He also said the government is focused on increasing the value of fish exports through greater processing capacity rather than relying on subsidies.
As part of that strategy, Shiyam said a contract has been awarded to develop a new 100-metric-tonne tuna canning factory in Hulhumalé. Construction is expected to be completed and the facility brought into operation within 18 months.
The minister added that the government’s approach is to develop the fisheries industry through collaboration between state-owned enterprises and private companies, stating that the benefits of this strategy are already becoming evident.
