Efforts underway to settle dues owed to SMEs before Ramadan

Finance Ministry on Wednesday affirmed that the government is working to clear outstanding payments owed to Small and Medium Enterprises (SMEs) ahead of Ramadan, the third deadline set by President Dr. Mohamed Muizzu for settling the dues.

One of the main concerns raised by SMEs during their meeting with President Muizzu on December 17 was the prolonged delays in receiving payments for government-contracted projects.  While there are outstanding payments of millions dating back more than a year, business owners have requested the government to resolve the issue by offsetting the dues against tax payments they owe.  

The President responded by assuring that the outstanding payments will be settled before next Ramadan.

With Ramadan set to begin next month, Sun inquired from the Finance Ministry regarding an update on this front including how many businesses have been paid so far, and how much, in addition to how much is still pending.

In response, the Ministry said efforts to settle the outstanding payments are ongoing, without providing any further details.

The Ministry also declined to clarify whether all outstanding payments can be settled before next Ramadan.

Prior to this, President Muizzu has stated that the government owes some MVR 2 billion to businesses.

The President initially set the deadline to settle the dues for last Ramadan. When the government was unable to meet this target, a second deadline was announced on November 26, with the assurance that the payments would be completed before the end of the year, and that efforts were ongoing to achieve this goal.

During the meeting on December 17th, SMEs also highlighted difficulties in procuring government projects, as State-Owned Enterprises (SOEs) are often awarded projects without a competitive bidding process. Moreover, some SOEs have also ventured into new businesses outside of their mandates.

Notably, President Dr. Mohamed Muizzu has designated the next two years, starting 2026, for the implementation of special measures for advancing SMEs.