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Solutions laid out for halted resort development projects

The government of Maldives is pushing to resolve the issues of undeveloped resort projects in the Maldives amidst facing major annual losses due to the delays.

Ameera Osmanagic
23 June 2024, MVT 18:09
Undeveloped island in the Maldives -- Photo: Mihaaru
Ameera Osmanagic
23 June 2024, MVT 18:09

The government has laid out solutions on how to proceed with halted resort development projects on islands leased by the government.

Minister of Tourism Ibrahim Faisal said that the Economic Council has decided on two pathways forward for islands that are currently not being developed.

If development work has not started on the island, the government will take the island back and explore avenues to recover funds owed to the State. However, if construction has begun, the government will look into how the resort opening can be expedited.

"Those who are unable to start work to return the island back to the government without any conditions. They also have big lease payments due. Or, if a foreign investor expresses interest, then arranging ways to amend the head lease," Minister Faisal explained the details.

He also detailed that if development has stopped after investments were made, then the island would be valuated and special arrangements would follow.

"We are moving forward with proposing additional amendments to the Tourism Act. There are islands that have not been developed for 30 years. There are parties which have to pay large amounts in lease and fines to the state," he added.

He went on to say that individual discussions are being held with the island owners to find a resolution for the issues faced. He stressed that the priority in these situations is to find ways of expediting the opening of resorts rather than taking the islands back.

As of now there are islands which have been developed anywhere between 10 to 70 percent, while many island have not undergone any development at all.

In the Fiscal Risk Statement published by the Ministry of Finance last year, USD 1.7 billion is lost annually from islands allocated for tourism purposes due to development of the islands being stopped.

Currently there are 170 resorts operating in the Maldives. Although the previous government also attempted to provide concessions for the unbuilt resorts, little progress was made to find a resolution.

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