The Maldives has extended invitations to the United States, United Kingdom and Japan to enter into free trade with the archipelago.
Economic minister Mohamed Saeed announced Tuesday that, in addition to the ongoing free trade negotiations with China and Hong Kong, the Maldives is also extending that invitation to the US, UK and Japan. The minister did not disclose further details.
“We’re always advocating for local companies to take maximum advantage of these developments around us,” stated the minister, speaking at the inauguration ceremony of Dhivehi Insurance, the new local insurance company with all-Maldivian shareholders and workforce.
While the Maldives is looking to enter into free trade with the US, the two nations had earlier signed a trade and investment framework agreement in October 2014 to strengthen bilateral economic relations. The US has also designated the Maldives a beneficiary country under its Generalised System of Preferences (GSP) programme, under which certain local products are already eligible for duty-free export to the US.
The UK is among the top five destinations for the Maldives’ exportation sector, with a hefty amount of local fish products regularly shipped to the UK. The Maldives had also recorded MVR 15 million of products exported to UK last August alone.
Meanwhile, the Maldives has long enjoyed close bilateral trade relations with Japan, which is a major economic benefactor of the island nation. While Japan had opened its embassy in the archipelago earlier this year, the Maldives had exported goods, mostly fish products, worth USD 12 million (MVR 185 million) to the East Asian giant last year. In return, Japan had exported goods up to USD 20 million (MVR 315 million) to the Maldives last year, comprising mostly of cars and marine vessel engines.
The Maldives and China entered into free trade talks last year and are currently preparing to sign the agreement within the first three months of 2017. The Maldives submitted two main points for the China deal. The first is exemption of tax from all food and seafood products exported from the archipelago to China, while the second calls for tax exemption for fish and seafood containing products that are prepared using 30 – 40 percent resources from the Maldives. For example, exempting tax from shrimp brought in from India and Sri Lanka and prepared in the Maldives to be exported to China.
The island nation also commenced free trade negotiations with Hong Kong in September. The government expects to sign the agreement within the next six months.
The free trade deal with China and then Hong Kong will mark the first time for the Maldives to enter into such an agreement with a specific country. Previously the island nation entered into a regional agreement with South Asian Free Trade Area (SAFTA) which includes all South Asian Association for Regional Cooperation (SAARC) countries.