Maldives to partner with Saudi Arabia and China on mega projects

Maldives to partner with Saudi Arabia and China on mega projects
December 01 19:18 2015

President Abdulla Yameen is looking to Saudi Arabia and China for development funding amidst persisting criticism of his human rights record by western powers.

On Sunday, the Maldives welcomed a team from China to begin work on a bridge between the capital Malé and the airport, as two ministers left for Saudi Arabia to secure funding for a port project in the north.

Housing Minister Dr Mohamed Muizz personally greeted a four-member team from the CCCC Second Harbour Engineering Company, which is set to begin work on constructing the US$200million Bridge next month.

The World Bank had blacklisted the company in 2009 over fraudulent practices during a road improvement project in the Phillipines.

The southeast corner of the city was cordoned off today for construction.

Meanwhile, Economic Development Minister Mohamed Saeed and Fisheries Minister Dr Mohamed Shainee said they were traveling to Riyad negotiate with the Saudi Investment Fund on investing in the northern I-Havan transshipment port.

The Saudi government had granted Maldives US$1million earlier in the year to conduct a feasibility study for the venture. The Boston Consulting Group, which conducted the study, will also take part in the talks, the ministers said.

The I-Havan port, which is to comprise of warehousing facilities, export processing zones, a cruise hub, a yacht marina, a dock yard, and tourist resorts, will be designated a Special Economic Zone, the government has said, which means investors will be granted extensive tax breaks.

Home Minister Umar Naseer on Monday night said he is certain Saudi Arabia will fund the project. “This is not just a transshipment port, it also includes oil refinery and storage facilities. That is why Saudi Arabia is interested,” he said.

Citing BCG, he said a consolidated population of 14,000 people is required to make the venture feasible, and urged people to relocate to the area. The total population of Haa Alif Atoll stands at 14,464 and is dispersed over some 14 islands.

The government will not force people to relocate, but hopes the “pull effect” of mega projects will result in population consolidation, he said.

In a diatribe last week, Yameen said Western countries are quick to criticize, but less forthcoming when it comes to lending.

“Some may think that it is easy for us to get foreign loans. No. Even those who criticize us the most, they do not spend on us,” he said on Wednesday. However, strategic alliances with India, China, Japan and Saudi Arabia “is proving to be good,” he said.

Yameen, whose administration has been besieged by multiple political crises, has long-criticised the West for what he calls undue interference in Maldivian affairs, especially since the imprisonment of former President Mohamed Nasheed on a charge of terrorism in March.

On Sunday, Yameen met with the Vice Chairman of Chinese People’s Political Consultative Conference Chen Xianoguang, and hailed China as “among the top contributors” to development in the Maldives.

Yameen said China is displaying “the paradigm of how big and small countries could work together towards mutual benefit.”

The president has previously said that the government is preparing to begin two major investment projects under its flagship SEZ Act in 2016.

Meanwhile, Saeed and Shainee, speaking to the press before their departure to Saudi Arabia, defended the government’s failure to attract major investments so far.

“Two years is not at all that long. The truth is negotiations in projects that came since then are resulting in even bigger projects…This administration, President Yameen, does not want to do it in name, unless it is feasible, no matter how much money is offered, we don’t touch it,” he said.

Saeed said: “It’s a lot of progress to be able to start the I-Havan project.”

Saudi investors had expressed interest in the venture during Yameen’s state visit to the kingdom earlier this year, they said. In June, a team led by the Saudi transport minister visited the Haa Alif atoll.

The government is also hoping to attract investment to build a youth city in Malé’s suburb Hulhumalé, oil and gas exploration, development of the Ibrahim Nasir International Airport, and the development of a port on Thilafushi, near the capital.

Two investment forums have been held so far, in Singapore last year and in Beijing this year.

Yameen has previously said China is interested in the youth city project, while the government had signed an MOU with UAE’s Dubai Ports World for the Thilafushi port.

Yameen has made three visits each to Saudi Arabia and China since assuming office. Before being crowned monarch, King Salman bin Abdulaziz al-Saud visited the Maldives in February last year, while Chinese President Xi Jinping made an official state visit to the Maldives in September last year.

While China has committed to constructing the Malé bridge, Saudi Arabia and Maldives recently penned an agreement hailed as a “religious bridge” to maintain religious unity here.