Economic diversification is at the root of the Maldives’ growth strategy. Minister of Economic Development Mohammed Saeed highlights the changes that are moving the economy forward.
What are your plans for diversification?
In 2014, we launched five projects including upgrades to Ibrahim Nasir International Airport (INIA), establishing a ‘Youth City’, and building the China-Maldives Friendship Bridge, thanks to Chinese support. We are expanding runways and terminal capacity, and consulting Singapore’s Changi Group on airport management. The ‘Youth City’ is now in its second phase, and will provide affordable housing, retail, sports and recreational facilities: what young people seek for a good standard of living. There are many opportunities for diversification, even in the tourism sector. Less than 200 of our 1,200 islands are inhabited, offering a lot of marine space for investments, such as island cruises.
You pushed for the Special Economic Zones (SEZ) Act. What are SEZ Ihavan’s main objectives?
It’s a huge investment, estimated at $3-4 billion. Ihavan atolls straddle the main shipping route linking Asia to Europe to the Middle East. It will offer the development of a transshipment port, cruise terminal and an international airport even larger than INIA. As a SEZ, foreigners will be able to invest duty-free. The regulations stated in the SEZ Act will improve efficiency on infrastructure projects by giving investors assurance and protection with freedom and opportunities never available before. The Maldives is a very safe venue for investments.
How are these projects being financed?
We are the 23rd founding member of China’s Asian Infrastructure Investment Bank (AIIB). This, along with regional development banks and commercial funds, gives us access to the resources needed to develop our dreams. To back up these investments and increase revenue, we are incentivising the private sector to complete 106 unfinished resorts, with up to 17.5 % duty exemption through 2017. We are also allowing construction companies to bypass the Malé commercial port.
What support can China offer to the Maldives’ diversification strategy?
A Chinese company is already working on INIA’s expansion, and various other infrastructure works have been awarded to the Beijing Urban Construction Group. By the end of the year, we hope to formalise a bilateral free trade agreement with China.