MTCC has no unmortgaged assets remaining: Zariyand

Ismail Zariyand, a financial sector expert, has stated that there is not a single unencumbered asset remaining at the Maldives Transport and Contracting Company (MTCC), with all assets currently held as collateral.

Speaking on RaajjeTV’s "Fala Surukhee" program, Zariyand stated that MTCC’s expenses are funded by the government, noting that the company remains heavily reliant on the state.

President Muizzu has decided to dissolve the Road Development Corporation (RDC) and merge it with the Maldives Transport and Contracting Company (MTCC). Highlighting this development, Zariyand stated that MTCC currently owes 2.97 billion MVR to various parties in trade and other debts. Zariyand further noted that MTCC’s buildings and equipment imported for various projects have also been pledged as collateral with banks.

Zariyand stated that according to the latest figures, the state owes MTCC 653 million Rufiyaa in the form of subsidies and compensation.

MTCC currently survives solely on government handouts. Another major issue facing the company is that it possesses no unencumbered assets. To date, MTCC owes 2.97 billion MVR to various parties in the form of commercial debt and other financial obligations. The company's primary buildings, as well as its dredging vessels, *Mahaa Jarraafu* and *Kuda Jarraafu*, have all been pledged as collateral to banks. Furthermore, the state has failed to settle 653 million MVR owed to MTCC in the form of subsidies and compensation.

Ismail Zariyand

Noting that the government does not settle payments for MTCC in the same manner as it does for private companies, Zariyand stated that the state disburses funds to MTCC over a period of four to five years.

Zariyand stated that although MTCC had reported significantly higher profits, the company’s actual realized profit by the end of last year amounted to only MVR 151 million.

On Monday, President Muizzu decided to merge MTCC with RDC, as well as dissolve Fenaka to merge it with STELCO. Commenting on these developments, Zariyand stated that STELCO’s current situation is significantly worse than that of MTCC.

Zariyand stated that STELCO's current assets stand at MVR 1.6 billion. However, he noted that the company owes MVR 1.8 billion to various parties in short-term debt. Consequently, he highlighted that STELCO's current ratio presently stands at 0.86.

While STELCO holds 1.6 billion MVR in current assets, the company’s short-term debt stands at 1.8 billion MVR. This indicates that the company's liabilities exceed its immediate liquidity; for every 1 MVR required for expenditure, STELCO currently has only 86 Laari available.

Ismail Zariyand

Zariyand stated that given the substantial debts already incurred by MTCC and STELCO, merging them with another entity would only serve to further escalate their financial liabilities.

During a press conference held at the President's Office on Monday, President Muizzu announced the decision to dissolve Fenaka Corporation and Road Development Corporation (RDC), merging them with STELCO and MTCC, respectively. President Muizzu stated that this decision followed extensive deliberations aimed at rightsizing state-owned enterprises and reducing government expenditure.

However, the merger of these companies has raised concerns regarding the job security of their current employees. Furthermore, with RDC and Fenaka currently undertaking numerous projects across various islands, the public continues to question the future status and continuity of these initiatives.