Maldives-China FTA will allow for bilateral trade up to USD 1 billion, the government said.
The Free Trade Agreement (FTA) between China and Maldives, which would allow current account transactions between both countries in their respective currency, would increase business transactions between the two countries up to a billion dollars, said Spokesperson of President's Office Heena Waleed.
Speaking at a press conference at the President's Office last evening, Heena said the MoU signed between the Maldivian government and the People's Bank of China on September 13 will bring many benefits to Maldives.
"USD700 million worth of trade is being done between Maldives and China. However, under the new FTA between Maldives and China and when this FTA comes into effect, this trade figure is going up to USD 1 billion," she said.
The agreement, which will allow transactions between the two countries in local currency, will greatly facilitate businessmen and locals traveling to China, she also added.
"With this agreement, a lot can be done in Maldivian Rufiyaa without having to pay in Dollars. With Maldivians being able to pay in Maldivian Rufiyaa, the dependence on dollars will be reduced for purchases," Heena further said.
The statement issued by the Economic Ministry after signing the MoU said that the agreement will establish a framework to facilitate current account transactions and direct investments between Maldives and China in the currencies of the two countries.
Maldives and China initially signed the Free Trade Agreement on December, 18, 2014 during former President Yameen's visit to China. The agreement was approved by the Progressive Party of Maldives (PPM)/Maldives Development Alliance (MDA) coalition majority on 29th November 2017. However, the administration changed and the subsequent government did not implement the agreement.
The agreement will, however, now come into effect before September's end, announced President Dr Mohamed Muizzu last July. When asked about it at the press conference, Heena said that the process is in progress.
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