Minister Shiyam: MIFCO no longer receives govt subsidies to purchase fish

Fisheries Minister Ahmed Shiyam, on Tuesday, revealed that the government has discontinued subsidies to the Maldives Industrial Fisheries Company (MIFCO) for fish purchasing, stating that the company no longer receives financial assistance from the government in this trajectory.

Responding to questions at the Parliament on Tuesday, Minister Shiyam said the decision was made as part of the government’s policy to transform MIFCO into a self-sustaining company. Under this approach, government funding previously provided for fish purchases has been halted.

The Minister said that when the current administration took office, private companies operating in the fisheries sector were close to withdrawing from the industry. However, he stated that recent policy changes have created a more favorable business environment, enabling the sector as a whole to progress alongside private operators.

"God willing, fisheries exports will increase, and the revenue generated from exported fish will also be increased," Minister Shiyam stated.

Criticising the previous administration’s decision to purchase fish at MVR 25 per kilogram, Shiyam explained that maintaining that price required a government subsidy of MVR 13 per kilogram. He stressed that the policy resulted in billions of rufiyaa in annual expenditure and questioned why those funds were not instead directed towards developing infrastructure and establishing fish processing facilities.

Highlighting longstanding challenges within the fisheries sector, the Minister noted that Felivaru has continued operating with only one processing facility for more than four decades.

He further stated that the current administration aims to increase daily fish canning capacity to 300 tonnes. Efforts are underway to establish fish processing facilities in F. Nilandhoo and Gdh. Fiyoaree, while expansion works to double production capacity at Felivaru are progressing rapidly.

Concluding his remarks, Minister Shiyam said that instead of providing politically driven subsidies for fish procurement, as he claimed had been done by previous administrations, the current government is focused on strengthening MIFCO into a company capable of purchasing fish without state assistance. He said these reforms would ultimately contribute to higher and more stable incomes for fishermen.

Minister Shiyam had previously stated that before the current administration assumed office, the significant increase in fish prices required a subsidy of MVR 13 per kilogram, amounting to an annual government expenditure of MVR 1.1 billion.

While the Maldives continues to allocate significant resources towards subsidies and financial support for state-owned enterprises, international financial institutions have repeatedly called for reforms to state-owned companies and improvements to subsidy frameworks to ensure long-term fiscal sustainability.