Minister: Some contractors using advance for gov projects to run own business

Some of the companies awarded government contracts take advance payments and then use it to finance their personal business ventures instead of running projects, says Infrastructure Minister Dr. Abdulla Muthalib.

Muthalib, who was summoned for questioning by the Parliament on Wednesday morning, was questioned by parliamentarians regarding various infrastructure projects in their constituencies.

Muthalib said that in 2023 and even prior to that, there were a number of companies that won bids for government contracts but then fled after taking advance payments for the projects.

He said that this includes companies that have done zero work on the projects they were awarded.

“They flee and then run their own business. They profit from these business ventures and then come back five or 10 years later and attempt to win another new project,” he said.

“The truth is, these companies take advance payments for government projects to finance their own business. This is resulting in massive losses to the state.”

Muthalib’s remarks come amid allegations that multiple government contracts, as well as contracts from government companies like Fenaka Corporation, were unfairly awarded to senior officials within the Maldivian Democratic Party (MDP) as well as their family members back when the party held office from 2018 to 2023.

Corruption in the award of government contracts is something that has plagued all Maldivian administrations. It is also something that poses major challenges to business owners who lack the right political affiliation.