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Sun Siyam requests USD 165 million loan guarantee from government

MP Siyam has requested the Finance Ministry to issue a sovereign guarantee for the purpose of developing a resort, further stating that this loan was agreed upon in 2018.

Aishath Shuba Solih
23 April 2024, MVT 15:58
MP of the Meedhoo Constituency, Ahmed Siyam Mohamed at the event held last night to commemorate PNC's acquirement of super majority in the parliament. -- Photo: Mihaaru News
Aishath Shuba Solih
23 April 2024, MVT 15:58

Renowned businessman and MP of Meedhoo Constituency, Ahmed Siyam Mohamed, has appealed to the government to issue a loan of USD 165 million (MVR 2.5 billion) to develop a tourist resort.

A document obtained by Mihaaru News reveals that Siyam had submitted a request to the Ministry of Finance appealing for a loan guarantee on the April 7.

According to the document, extensive efforts are being made to secure financing for the development of the 'Emerald Lagoon Resort' in Kaafu Atoll. The document outlines plans to develop 1,500 beds in the resort, with an estimated cost of USD 165 million (MVR 2.5 billion).

While discussions have been held with the Chinese contractor, Shanghai Constructions Group (SCG) for the development of the Emerald Lagoon resort, the document states that a loan from a Chinese bank can only be obtained with a guarantee from the government.

The document stated that, therefore, a statement letter offering a guarantee is required to proceed with the project.

Siyam's business, Ahmed Siyam Holdings (ASH), had secured a loan of USD 127 million from China's Exim Bank after obtaining a sovereign guarantee from the State in 2017. This was for the development of a resort named 'Irufen' in Noonu atoll Dhigurah, under the policy of guarantee issued by the State. While issues of unsettled payments arose due to repayment difficulties amid Covid-19, Siyam later settled all delayed payments.

The document stated that the State had agreed to issue a sovereign guarantee for this project, which required a new guarantee on January 23, 2018, as well. The letter mentioned that, however, a new document is required from the government to confirm if the administration still intends to issue a guarantee.

The document signed by Siyam on behalf of Emerald Lagoon further highlighted that the statement by the government on procedures for providing a sovereign guarantee said that guarantee for investment loans issued with an interest rate lower than 4 percent will be provided by the government.

Minister of Finance, Dr. Mohamed Shafeeq said that a company of Sun Siyam had requested a sovereign guarantee, which is currently under review.