The most significant of these issues came to light towards the end of 2023 when the company's new Managing Director, Muaz Mohamed Rasheed, revealed that FENAKA's procurement policy had been overridden to purchase a large number of goods through emergency procurement.
Gaafu media
In recent years, FENAKA Corporation, a key utility provider in the Maldives, has been at the centre of scrutiny due to a series of financial mismanagement issues. The company, which is responsible for providing electricity, water, and sewerage services to many islands across the country, has faced significant challenges that have led to its current financial difficulties. These challenges have not only tarnished the company's reputation but also strained its ability to deliver essential services effectively.
The most significant of these issues came to light towards the end of 2023 when the company's new Managing Director, Muaz Mohamed Rasheed, revealed that FENAKA's procurement policy had been overridden to purchase a large number of goods through emergency procurement. This method of procurement, known to be the most expensive, was used extensively, leading to substantial financial burdens for the company. The mismanagement extended beyond procurement practices; FENAKA also continued to employ hundreds of contract workers even after their respective projects had either concluded or were halted. This decision led to the company paying out large sums in salaries to employees who were no longer needed, further exacerbating its financial woes.
In response to these revelations, it became clear that FENAKA required significant reform to return to profitability and restore public confidence. Recognizing the urgency of the situation, President Dr Mohamed Muizzu, in consultation with the Cabinet, decided to transfer all shares of FENAKA Corporation to the State Trading Organisation (STO). This decision effectively made FENAKA a subsidiary of STO, with the goal of revitalizing the utility sector and ensuring more efficient operations.
The President's Office emphasized that this move was designed to strengthen FENAKA's financial standing while improving service delivery to the public. The transition to STO's leadership is expected to bring several advantages, including enhanced financial oversight, streamlined operations, workforce optimization, and regulatory reforms.
The decision to transfer FENAKA under STO's control marks a significant shift in the management of the country's utility sector. By leveraging STO's expertise and resources, the government aims to transform FENAKA into a more efficient, transparent, and profitable entity, ultimately benefiting the Maldivian people.
