After months of buying fish from local fishermen at prices higher than global market rates and facing difficulties in making payments, MIFCO has finally decided to pay global rates for the fish they purchase locally.
State owned enterprise Maldives Industrial Fisheries Co. Ltd (MIFCO) will start buying fish from local fishermen at global market prices instead of its previously decided rates starting tomorrow.
In a statement released by MIFCO today, the company said that the expenses of the company in terms of purchasing fish from fishermen, processing and selling is much higher than the income generated from selling fish at international markets.
The funds to manage these costs were acquired through loans and government support, the statement read.
The current global market rates for a kilogram of fish is at MVR 18 to 20.
MIFCO stated that so far, MVR 353 million has been paid to fishermen, and an additional MVR 389 million has been issued from the company's revenue for the fish purchased from them.
The company has also issued MVR 831 million to fishing vessels this year, including fuel and ice.
MIFCO also said that it is not financially sustainable to buy fish without taking into account the market price.
MIFCO announced that, in order to continuously pay fishermen for the fish they sell, the company will start buying fish from fishermen based on international market prices for skipjack tuna and the costs associated with exporting the fish.
This price will be announced by the company on a weekly basis, the statement read.
The company also said that it is working with government institutions to implement strong measures to reduce its costs.
Until now, MIFCO has bought fish from local fishermen at a price determined by the government, without considering international market prices. Around the time of the most recent presidential election, the previous administration increased the price they would pay for a kilogram of fish to MVR 25. This price was reduced by the current administration to MVR 20.
However, even at a lowered price, a significant government subsidy is still required to pay fishermen. Each year, the government allocates a subsidy of over MVR 400 million for fishermen.
Paying fishermen for the fish bought from them has been often delayed as a result of not decreasing the price at which fish is bought, despite experts calling to lower the price to meet international market rates.
This delay has resulted in many protests led by fishermen ever since the current administration came onto power.
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