World Bank criticises second housing company
According to the World Bank, financial burden of the loans taken by FDC for the housing projects must be borne by the finance ministry.
By
Ahmed Naif
Fahi Dhiriulhun Corporation (FDC), established by the current administration to carry out housing projects, will not support in achieving the government's goals to provide affordable housing and instead may turn into a financial burden for the state, the World Bank has said.
According to the Maldives Development Update report published by the World Bank on Thursday, the pre-existing Housing Development Corporation (HDC) is currently carrying out housing projects and it is not a good policy to establish an additional company to carry out the same.
The report noted:
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FDC does not generate any income
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The government has to provide all capital for the corporation since they do not have any existing assets that they can collaterise
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Loans worth USD 226.5 million attained from abroad for the 4,000 housing units project being run by FDC
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FDC does not have loan repaying capacity
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The financial burden of these loans must be taken by the finance ministry.
The report also noted that FDC was established to carry out all state run housing projects, but even three years after establishment, the work of the company has not adapted to the state guidelines.
FDC has suffered a total loss of MVR 10 million in the past two years. The government has allocated MVR 26.9 million as capital injection to FDC from this year's budget as well.
