Maldives Business Chambers (MBC) has described the Rasmale’ project as a golden opportunity to grow the country’s small and medium-sized enterprises (SMEs) and speed up economic growth.
The association made the remarks in a statement on the Rasmale’ Waterfront and Marina project.
MBC’s statement puts the project’s investment value at around USD 20 billion (about MVR 308 billion) and calls it a historic chance to expand the Maldivian economy beyond its traditional sectors. The statement listed several expected benefits:
- More than USD 30 billion in foreign investment over the life of the project
- Over 54,000 direct and indirect jobs
- More than one million tourist arrivals a year
- USD 2 billion in annual tourism revenue
According to MBC, the project will open new markets for Maldivian businesses in construction, agriculture, fisheries and hospitality, as well as logistics, retail, technology and professional services. The statement also says the project’s real economic success will depend on the jobs it creates for Maldivians, the growth in national productivity and youth skills, and the wealth it brings the country.
MBC said it will push for Maldivian businesses to take full part in local procurement of goods and services, supply contracts, skills development and investment opportunities. The association sees the project as a vital step towards diversifying the economy, raising state revenue, and improving housing and infrastructure.
The government signed a commercial terms agreement last week with Eagle Hills, a leading developer from the United Arab Emirates (UAE), to build a major project in Rasmale’ under the name “Maldives Waterfront and Marina.” The government has decided to give the company 500 hectares of land in Rasmale’ under the project, and some political leaders have raised concerns over the deal.
The Housing Ministry said Eagle Hills must pay the state 10% of its gross revenue from the Maldives Waterfront and Marina project as a land premium. The ministry estimates the state will receive a total of USD 3 billion through land lease or premium payments. Under the commercial terms, Eagle Hills has also agreed to pay USD 500 million of that sum in advance for a government-run housing project.
The ministry added that this figure has strong potential to grow as property prices rise in the market.
Direct revenue to the state from the Eagle Hills project includes:
- 10% of the developer’s gross revenue as land premium (roughly USD 3.1 billion over 10 years)
- An advance payment of USD 500 million from that revenue share for a government-run housing project
- A 4% charge on a unit’s market value, which buyers must pay the government every time a unit changes hands
- Tax revenue from economic activity in Rasmale’
- No import duty exemption for the project
The ministry said the commercial terms with Eagle Hills include measures that no industry in the Maldives has seen before, designed to keep foreign currency circulating in the local economy during both the development and operational phases of real estate projects, including Rasmale’.