The World Bank’s Board of Executive Directors approves a USD 15 million project to strengthen private participation in and financial sustainability of state-owned enterprises (SOEs) and the mechanisms that support the competitiveness of small and medium enterprises (SMEs) in Maldives.
The Bank said that the 'Maldives Competitiveness and Growth Project aims to help the government enhance private participation in select SOEs, improve the way these enterprises are governed, and reform their public service obligations and subsidies.
It said that this project will also help make Maldives' private SMEs more competitive by improving digital financial systems to make it easier for them to access commercial loans and assisting selected innovative and capable SMEs to enhance their growth trajectory and develop new and climate-friendly products to compete in new markets.
In its statement, the World Bank described the Maldives as an upper-middle-income country but said that its economy relies heavily on just a few industries.
It highlighted that economic growth has slowed recently, and issues with government spending and debt have worsened. The Bank said that the government plans to speed up its delayed efforts to improve SOEs and help SMEs that face difficult and fast-changing business environment challenges ranging from high transportation costs, skills and employment shortages, limited natural resources, and competition with SOEs.
World Bank said that the project will be implemented by the Ministry of Finance.
It added that the total financing is USD 15 million, which is comprised of a USD 7.5 million grant and a USD 7.5 million credit from the International Development Association (IDA), the World Bank’s concessional credit window for developing countries.
