EU mission highlights SOE misuse as key unaddressed electoral concern

4,300 new hires in 2024 contradict government's reform pledge.

Artwork: Dosain

18 Nov, 4:44 PM

When the European Union observed the 2023 presidential election, the mission identified the weaponisation of government jobs and projects as a critical concern, recommending "measures to combat the misuse of state resources, including the instrumentalisation of state-owned enterprises for campaign purposes."

Midway through the electoral cycle – five months before the local council elections in March and three years before the next presidential polls – the EU's Election Follow-up Mission returned in late October to assess progress towards electoral reforms. Political finance oversight has "diminished" while state-owned enterprises have only "grown in number and influence," it warned after meetings with stakeholders and conducting a roundtable discussion on November 10.

"The government assured me that they are aware of the problem and are already reducing personnel in oversized enterprises," Chief of Mission Nacho Sánchez Amor revealed at the roundtable meeting, calling for renewed efforts to "enhance accountability in political finance."

In its report after the 2023 polls, the EU observation mission had flagged the misuse of SOEs as a "recurring issue" ahead of elections. The previous administration "used SOEs, most prominently Fenaka (utilities) and MTCC (transport and contracting) to demonstrate their efforts on local development and decentralisation, in particular during presidential visits, and reportedly hundreds of people were given new jobs during the pre-electoral period," the report stated.

While the former Maldivian Democratic Party-led government justified the hiring spree as necessary to carry out new projects, the "opposition and civil society provided numerous examples of fresh employment, with the purported goal of enticing voter support and use of their labour to participate in campaigns."

Contrary to the current administration's assurances to the EU follow-up mission, the Privatisation and Corporatisation Board's annual report for 2024 showed an increase of more than 4,300 employees for SOEs during President Dr Mohamed Muizzu's first year in office. The number of staff at SOEs grew from 34,659 in 2023 to 38,969 last year.

Fenaka, a state-owned utility that provides electricity and sewage services to most islands outside the Greater Malé Region, employed more than 7,000 staff as of mid-2024.

The PCB has yet to publish updated figures. Despite the government's promise to reform or privatise companies that rely on financial support from the budget, revised figures for 2025 show MVR 2.5 billion (US$ 155.6 million) as capital injections to SOEs, up from MVR 1.5 billion in the previous year. More than MVR 496 million was transferred this year to SOEs to manage expenditures.

A dozen budget-supported SOEs posted a combined loss of MVR 156 million during the first quarter of 2025.

Window for reform

Only one of 20 recommendations made by the EU in January 2024 has been implemented in full, the followup mission found, referring to amendments ratified to the election law in February 2024, which more clearly stipulated how the Elections Commission would determine and declare the timing of ballot casting, closing of polling stations and ballot counting.

The changes also prohibited conducting elections during Ramadan.

According to the mission chief, implementation of the recommendation on three areas is ongoing, while it was too early to assess progress on three other recommendations. The mission also positively noted a draft data protection bill and new initiatives for civic and voter educations by the EC.

“These three years remain until the next presidential election, but action is required now to show political will to conduct reforms and avoid any democratic backsliding,” Amor, the chief of mission, told the press in Malé last week.

Amor said he learned about vote-buying and the weaponisation of SOEs from the then-opposition, now the ruling party. The reversal of roles has made conveying the message easier, he suggested, stressing that "somebody has to break the circle."

Beyond the SOE concerns, the mission found wider signs of democratic deterioration. Many stakeholders "pointed to the erosion of democratic standards" and raised concern about the "weakening of institutional checks and balances and increased control of the executive over key institutions and the judiciary," Amor said.

"A number of wide-ranging legal changes, including constitutional changes, has been undertaken in a hasty manner, without broad consultation," he said at the press conference.

The mission chief warned that recent legal changes have reshaped both centralised governance and the media environment. The new legal framework regulating media must be applied "in full respect of human rights commitments, independence of the media, pluralism and the right to access information as cornerstones of democracy and of credible elections."

"I want to remind that fundamental rights like the freedom of expression and the freedom of assembly, also intrinsically embedded in elections, need to be safeguarded under any circumstances while conducting legal reforms," Amor said. "The separation of powers and independence of institutions also must be upheld."

In the coming weeks, the mission will prepare a final report on the implementation of the recommendations, he noted, pledging the EU's support for multi-party democracy and good governance in the Maldives.

Amor said his message to the government was a political one: "You have the means, you have the presidency, you have the majority of the parliament, and you have time – meaning this is the opportunity to offer to your country a good improvement, leaving behind some old habits very entrenched in the political culture of the country."

Seven priority recommendations from the EU:

Develop and implement a comprehensive and continuous civic and voter education programme nationwide, including in educational institutions, with a special focus on political rights, freedom of choice in voting, and the impact of vote-buying on democracy.

Introduce measures in law and combat the misuse of state resources, including the instrumentalisation of state-owned enterprises for campaign purposes

To enhance the accountability of political parties and election candidates, revise and close gaps in the legal framework regulating campaign finance

Provide training and professional development courses for journalists and editors to equip them with the knowledge and skills necessary to produce balanced, ethical and responsible journalism during elections, including merit-based coverage of the electoral campaign.

Support civil society fact- checking initiatives in the Maldives to verify information and combat disinformation and ensure corrections when false information is spread.

Introduce affirmative action measures to ensure nomination of women to leadership positions

Introduce and implement instructions on the determination of the validity of votes to ensure that polling staff respect the intention of the voter as clearly expressed on a ballot paper.

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EU mission highlights SOE misuse as key unaddressed electoral concern

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