Mismanagement of funds contribute to FSC loss
October 2, 2019 7:26 am
The Fiji Sugar Corporation’s financial resources and cash flow is being strained by having to pay back loans.
The loans are to be paid to the Exim Bank of India – which were mismanaged years ago.
FSC Board Chair Vishnu Mohan revealed at the Corporation’s Annual General Meeting yesterday, that the Board continues to address the impact of past legacy issues.
Mohan adds that misuse of funds, is still affecting the FSC financially because the Corporation is legally bound to pay back the money – even though it wasn’t used for its intended purpose.
“We also got money from the Exim Bank of India for the upgrade of various factories and sadly the use of those monies have not being diligent as it should have been and there was grossly mismanagement and the funds we got from the Exim Bank was not used properly.”
Mohan adds they are in negotiations to restructure this debt and convert it to equity. The government – as major shareholder is actively engaged in this process.
The Corporation made a consolidated loss of $23.1 million for the financial year ending in May this year, compared to a profit of $800,000 last year.
Mohan says the FSC also faced unpredictable climatic challenges, the age and condition of the sugar mills and an oversupply of sugar onto the world market affecting the pricing.
FSC CEO, Graham Clarke says they are encouraged by FSC’s performance in the current financial year and expect better results to cushion the blow felt by the loss made in last years books.