The Maldives government will dissolve two of its largest state-owned enterprises, President Mohamed Muizzu has said.
Fenaka Corporation, which supplies electricity to the country’s inhabited islands, and the Road Development Corporation (RDC) will both be wound up, Muizzu told a news conference at the President’s Office on Monday.
Fenaka’s services will be transferred to the State Electric Company (STELCO), which will become the sole provider of electricity across the country. RDC’s ongoing work will be handed to the Maldives Transport and Contracting Company (MTCC).
President Muizzu said technical advisers had concluded that Fenaka could not be run on a sustainable basis.
He said an Auditor General”s report had exposed wrongdoing carried out in the company’s name under the previous administration. The government had taken steps to improve the quality of service, he said but decided instead to close the company down.
On RDC, the President said the existence of several state companies performing the same work was driving up government spending. The decision was taken to deliver development projects through a more disciplined structure, he said.
The Anti-Corruption Commission (ACC) is investigating 161 cases involving Fenaka. It has also ordered the recovery of MVR 21.4 million (USD 1.4 million) owed to the company.
Fenaka employs more than 8,000 people. The company has said its wage bill has left it struggling to fund generator spare parts and fuel.
The utility operates powerhouses on island across the country, many of them small and remote, and has long been among the most heavily indebted of the country’s state-owned enterprises.
STELCO has until now supplied electricity to Malé and the surrounding urban islands.
The restructuring is part of a broader consolidation of state companies. President Muizzu has said staff numbers at the companies involved will fall once the changes are complete.