STO: Staples are warehoused on purchased land

Managing Director of State Trading Organization (STO), Ahmed Shaheer has denied claims the organization warehoused staple goods on land leased by the government at a very low rate.

Senior staff of STO, as well as senior State officials were summoned to a People’s Majlis’s Government Oversight Committee meeting held this Tuesday over the decision to cut subsidies on staple products.

Those summoned include Minister of Finance – Ahmed Munawwar, Minister of Economic Development – Mohamed Saeed, CEO of National Social Protection Agency (NSPA) – Mujthaba Jaleel, Chairman of STO – Ahmed Niyaz and Managing Director of STO – Ahmed Shaheer.

In answer to a question by Addu-Meedhoo MP Rozaina Adam, MD Shaheer said that given STO was a State organization, they had multiple land sold to them at a low price by the State, dating back to a long time.

He said that the government, in 2010, had sold five lands to STO in a swap deal in exchange for a large amount of money the State owed to the organization.

“We have purchased five of the land we operate on. We are using a 40,000-foot land to warehouse our staple products. It was purchased by STO. We don’t have to pay anything to the State,” said Shaheer.

He said that STO had bought the land for an amount above the market rate at the time.

“We bought the five land at a high cost. That was a swap deal in exchange for money owing to STO. The government in power at the time offered a swap in exchange for the amount owing in payments,” said Shaheer.

Shaheer also said that STO bought its stock of staples for a year in an open bidding process.

He said that there were five main companies which usually supplied the staples to STO – including companies from India, Dubai, Turkey and Sri Lanka.

“STO buys the staples at a very competitive rate, in an open tender process. We buy everything in a bidding process,” he said.

The State controls the price of staple products in the country through STO, and staple products were made available at a subsidized rate for the whole population.

The State, on October 1, cut subsidy on staples to the general population, ensuring that it goes only to the poor.