The government has decided to implement measures to make state-owned enterprises (SOEs) profitable and reduce state spending on the companies.
At a press conference, Principal Secretary to the President Abdulla Nazim Ibrahim said the Cabinet has formulated policies to make the SOEs profitable. As such, measures will be implemented within three months to amend the law on classifying SOEs and using key performance indicators to improve their performance.
Additionally, Nazim said the government will determine which companies will be nationalized, operate in a public/private partnership, or sell shares under an initial public offering (IPO). He also said changes will be made to strengthen company management by establishing sub-committees, audit, nomination and remuneration committees within three months.
Furthermore, Nazim said the Cabinet has decided to determine the conditions under which subsidies and capital will be provided to SOEs as well as formulate rules to take action against underperforming companies. He added that the government will provide companies with cash flow adjustments and give them up to the first six months of next year to improve their performance. He added that companies that fail to improve their performance during the timeframe will be restructured, merged, or liquidated if necessary.
Moreover, Nazim said a law will be formulated on the establishment of new SOEs within three months. He also said the government plans to establish more infrastructure development companies to ease the workload at the Maldives Transport and Contracting Company (MTCC).