Advisor to the Minister of Finance, Ahmed Munawwar blasted the former government of Maldives for plunging SOEs into heavy debt and said companies should be able to manage expenses from revenue generated.
State Owned Enterprises (SOE)s were run in a very poor and financially damaging manner during former president Ibrahim Mohamed Solih's administration with the total debt of these companies reaching MVR 98 billion, said current Advisor to the Finance Minister Ahmed Munawwar last night.
Speaking at Public Service Media (PSM)'s 'Raajje Miadhu' programme, Munawwar said that along with the state's debt, SOEs' debts have also increased, with millions being spent by the government on running the companies.
As such, the current administration has important plans within its reform agenda to cuts costs at SOEs, he said.
"The total debt was at 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," Munawwar, who served as Finance Minister during former President Abdulla Yameen Abdul Qayyoom's regime said.
He recalled that during his time as minister, financial support provided to companies such as Fenaka were limited to a certain amount.
"In 2018, Fenaka's total debt was at 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.
According to Munawwar, companies were not managed with debt repayment in consideration during the past five years. He gave another example, highlighting that STELCO's debt was at MVR 2.8 billion during 2018, which then rose to MVR 3.8 billion by the end of President Solih's administration in 2023.
Island Aviation's debt also quadrupled to MVR 4 billion, he said.
In light of this, Munawwar said that a company should be able to manage its operations with its revenue. However, SOEs are being managed with financial supplementation from the state every month, he said.
Sign In