Malé, Maldives - Fenaka Corporation Limited, the utility company responsible for providing electricity throughout the Maldives, has borrowed MVR 250 million from the Maldives Islamic Bank in a bid to address its mounting financial struggles.
Since President Ibrahim Mohammed Solih's inauguration, Fenaka's debts have consistently increased. As of now, the company's short-term debt has exceeded MVR 2 billion. Unfortunately, the corporation lacks the necessary cash flow to address this debt, which has raised concerns about its ability to stay afloat. Industry insiders have speculated that Fenaka may be forced to sell some of its assets to cover its debt.
Adding to the company's woes, contractors who have supplied various services to Fenaka are voicing their grievances and organizing protests due to non-payment of their dues. The delays in payments have caused discontent in the business community and could pose further challenges for the utility firm.
Reliable sources have revealed that the recent loan from Maldives Islamic Bank is primarily aimed at settling the company's outstanding dues to these contractors. This move is speculated to be timely, as clearing debts ahead of the upcoming presidential elections might be seen as a strategic play to minimize negative publicity.
The situation places a spotlight on Fenaka's management and its ability to navigate through these financial challenges. While the loan might offer temporary relief, the broader questions about the company's fiscal sustainability and long-term strategy remain unanswered.