Opportunities created for youth in private sector through MVR 600M SME Impact Fund: Finance Minister

Minister of Finance and Public Enterprises Hassan Zareer told Parliament today that the government is expanding financial support for Maldivian youth and entrepreneurs to start and grow private businesses through the MVR 600 million SME Impact Fund.

Responding to questions from Galolhu Uthuru MP Mohamed Ibrahim, Zareer said the fund, established under the name “Kumevi,” is intended to create more opportunities for young people to enter the business sector, support small and medium-sized enterprises, and generate employment outside the state sector.

He said operations under the MVR 600 million fund are currently being carried out in partnership with SME Digital.

According to the minister, the initiative forms part of the government’s broader policy to expand economic opportunities as State-Owned Enterprises (SOEs) undergo restructuring aimed at improving their financial and operational sustainability.

Zareer said the government wants to create more avenues, particularly for young people, to establish private businesses and earn an income rather than relying primarily on jobs in government institutions and state-owned companies.

He highlighted the SME Impact Fund as a key component of the government’s efforts to widen employment opportunities while reforming SOEs.

Statistics presented to Parliament showed that the number of employees in state-owned companies has risen sharply in recent years.

In 2018, SOEs employed 18,676 people. By the end of the previous MDP administration, the figure had increased to 36,729, representing an increase of almost 100 percent over five years. The total SOE workforce currently stands at 41,667.

Zareer said the rapid expansion of SOE workforces has placed significant financial pressure on both state-owned companies and the national budget.

Considering the country’s financial situation, he said the Finance Ministry has instructed companies through the Privatization and Corporatization Board (PCB) to strengthen governance, control costs and maintain workforce levels appropriate to their operational requirements.

However, Zareer stressed that the ministry would not interfere in individual dismissals or the day-to-day employment decisions of state-owned companies.

He also said the government has no policy of dismissing employees based on political affiliation and that the Finance Ministry has issued no such instructions.

Alongside the SOE reform programme, the government is seeking to increase public participation in the economy through private enterprise.

Zareer said the MVR 600 million Kumevi fund is designed to provide financial assistance to SMEs and entrepreneurs, helping them expand their businesses and become job creators.

The government is also taking steps to merge or liquidate non-performing state-owned companies and entities that remain heavily dependent on the state budget.

As part of those reforms, Maldives Sports Corporation has been dissolved, while the liquidation of Maldives Integrated Tourism Development Corporation (MITDC) is currently underway.

Zareer also said the merger of Regional Airports Company with Maldives Airports Company Limited (MACL) has resulted in savings of approximately MVR 10 million per month in staff and operational expenses from the state budget.

The minister said the government’s objective is to improve the financial sustainability of state-owned companies while creating more opportunities for Maldivians to participate in the economy through private businesses.

He described the SME Impact Fund as an important initiative to provide young people with access to capital, support entrepreneurship and create more jobs outside the state sector.