The Government of Maldives has revealed loans issued to state owned enterprises (SOEs) totals over USD 29.8 million.
The total approved loan amount for SOEs in 2019 is at USD 5.82 million, which is 7% of the capital expenses approved for the year, according to statistics revealed by Ministry of Finance. However, the amount is expected to reach USD 29.8 million by the end of the year, due to significant loan demands of SOEs.
The loan amounts increased this year with the government allowing additional loans to SOEs to manage company cash flows in addition to loans arranged to complete SIFCO and POLCO housing projects. Additionally, the loan amounts also inflated due to sovereign guarantees issued by the state.
State budget proposed for 2020 includes a loan amount of USD 3.23 million allocated to develop small and medium enterprises (SMEs). Although the budget indicates the loan amount of USD 29.8 million, no loan amounts have been included for 2020. Companies will be supported via capital issuance next year.
The government has introduced SME Development Finance Corporation (SDFC) to support SMEs and the bank has issued over USD 7.76 million in loans.