Rasmalé: A good deal would have nothing to hide

Maldivians are being asked to back a deal they cannot read.

Artwork: Dosain

1 hour ago

The Maldives needs foreign investment. Our economy cannot grow, diversify and create enough opportunity without attracting serious international capital.

There cannot, however, be credible foreign investment without consistent and predictable rules, enforceable contracts, clear tax treatment, transparent land arrangements, and a credible dispute resolution mechanism.

When the deal in question involves 500 hectares of exceptionally valuable public land, a few kilometers away from the capital city, the standard should be even higher. The land must be independently valued, the investor’s obligations measurable and enforceable, and the duration and transferability of rights granted clearly defined.

The Rasmalé agreement falls well short of these requirements.

President Dr Mohamed Muizzu's administration has entered into a "commercial terms agreement" with Eagle Hills involving more than 500 hectares of Rasmalé, but the public has yet to see a word of the agreement. There are no published commercial terms, no legal framework, no clue, really, what the developer’s investment obligations are or the conditions under which the land ultimately reverts to the Maldives.

No independent valuation has been published. No revenue base has been defined. No bids were tendered, no due diligence completed. In sum, the only thing we know about the deal is that we are planning to hand over 500 hectares of land to a foreign entity.

Not your average resort development

Over the weeks since the announcement of the project, the Maldivian people have levelled question after question at both the administration and Eagle Hills, demanding transparency and clarity, only to be met with empty reassurances from government mouthpieces.

The Muizzu administration has tried its utmost to pass off the development as “just another tourism development.” At every opportunity, ministers stress that the project will “fall within the usual tourism guidelines,” and that “all agreements will be made according to existing legislative terms”.

Why then, is there a need for a “real estate” bill? Why has Alabbar had private meetings with politicians including cabinet members and parliamentarians? Why all the veils and secrecy?

The Muizzu administration, alongside Eagle Hills and its founder, have launched an all encompassing propaganda campaign, offering incredible sums of money to news agencies for providing positive coverage, flying journalists and media personalities across the world for interviews, and making personal appearances on every conceivable media outlet. They appear to be wholeheartedly committed to doing everything you could think of to convince us the deal is good, except actually publishing the actual terms of the agreement.

Worthy bedfellows?

Before moving on to the issues concerning what few particulars we know of the deal, an assessment of our would-be partners in this venture is an absolute necessity. The first point of clarification is that the agreement is to be made with Eagle Hills, and not the world-renowned Emaar Properties that Mohamed Alabbar is prominently associated with.

Emaar was the company responsible for the Dubai Marina and Waterfront, and Downtown Dubai. The company is worth tens of billions of US dollars and shares are publicly traded on the Dubai Stock Exchange.

On the other hand, every major development involving the privately owned Eagle Hills is steeped in secrecy and controversy.

In what appears to be a perfect parallel to the Maldivian example, protests erupted in Georgia after US$6.5 billion deal involving Eagle Hills was “classified” and kept from the public. In Hungary, the government ultimately pulled out of the €12 billion ‘Grand Budapest’ project after immense public outcry regarding the lack of transparency and clarity surrounding the deal.

During the construction of the Durres Marina, Eagle Hills was accused of cutting corners in their subcontracting, as two navy buildings failed safety and security inspections, having sunk some 30cm due to poor structural engineering.

In Serbia, masked men with baseball bats were used by the state to enforce demolition orders, as thousands took to the streets protesting what they called a fraudulent deal. Illegal workers were alleged to have been used during construction, with several dying due to the unsafe conditions.

All this, just to net the state a cumulative total of just €10 million, as ‘Eagle Hills’ in the UAE - the creditor of ‘Eagle Hills Serbia’ - walked away with almost €900 million in sales revenue.

In sum, Eagle Hills track record does little to inspire confidence in the deal. None of their developments have delivered on what they have promised, and there is no evidence at all to suggest that the company is capable of taking on a project of the scale claimed for Rasmale’.

All this however, is preamble to the actual problems with the agreement itself. The pattern of confusion and obfuscation prevailing in their other deals persists today, and each aspect deserves due consideration, so we might begin to understand just what it is that president Muizzu is choosing to sign.

There is no US$20 billion

The administration’s ministers and defenders have parroted a grossly bloated evaluation of the investment proposal. Some claim US$12 billion, others US$20 billion; neither number carries any actual weight or commitment behind them.

The relevant question is what Eagle Hills is actually contractually required to invest: how much equity it must inject, how much can be financed through debt, what can be transferred to third parties, what the minimum committed investment is, over what period it must be deployed, and which development milestones must be met.

The same applies to enforcement. What performance guarantees has the state obtained? What constitutes default? If development stalls after part of the land has already been commercially exploited, can the government terminate the arrangement and recover undeveloped land? Are there clawback provisions?

A large, integrated project may eventually contain billions of dollars’ worth of hotels, apartments, shops, offices and other assets financed or developed by multiple parties. US$20 billion however, is almost triple the GDP of the Maldives. That is three times the sum of every good, every service, every financial asset and every act of labour produced in our country today.

By Eagle Hills’ own admission, this “estimate” is based on a scenario where every plot of the 500 hectare land is developed, with more than a million tourists (yes, one million tourists) visiting each year. For context, this is some 40 per cent of the total tourist arrivals we see annually, the combined arrivals generated by every resort, guesthouse, hotel and homestay in the country. The development promises 54,000 new jobs; a number equal to the total of current tourism employment. Again, a number so startlingly large that it beggars belief.

No sane economist accepts these numbers as they appear. No financial analyst believes the returns will be anywhere close to the administration’s projections. The numbers, in summary, are a sham.

The abhorrent lack of due process renders everything in even worse light. Everything about this deal stinks to high heaven, and without published terms, there is no way to clear the air.

Ten per cent of what?

The government-promoted headline percentage is meaningless without context. Ten per cent of gross revenue is very different from 10 per cent of net revenue. Property-sale proceeds are different from operating revenue, and both are distinct from distributable profit.

How is the state’s share applied when residences are sold and resold? Are hotel revenues, retail leases, marina fees, branded residences, management fees, third-party developments and the sale of development rights included in the share?

The financing structure is also utterly opaque. A project may well generate large sales while producing little-to-no distributable profit, if the project company carries substantial debt, pays management or development fees, or services financing owed to related companies.

A resetting “99-year” lease

The clearest illustration of the transparency problem concerns the leasehold terms.

When Eagle Hills first announced the project, its statement said the 99-year leasehold would be transferable and inheritable and that, upon each transfer through sale or inheritance, a new leasehold term of up to 99 years would commence.

That wording had obvious implications. If a fresh term could begin every time a property changed hands, a parcel could theoretically remain subject to successive private leasehold interests indefinitely even though formal freehold title remained with the state.

That is not technically the same as selling Maldivian land freehold, but it produces something approaching indefinite private control if the lease clock can be infinitely restarted.

Following immense public criticism, Eagle Hills changed its announcement. The current wording instead says the lease is transferable and inheritable, with each transfer subject to government approval and registration. Infrastructure Minister Abdulla Muththalib has also said transfers would require government approval and payment of applicable fees.

A tweak to a statement decidedly does not settle the matter. All it does is raise more concerns.Was Eagle Hills’ first announcement inaccurate? Did the government object after the provision became public? Was the underlying agreement amended, or was only the public statement changed?

If the signed agreement never contained an automatic reset, publish it and settle the issue. If it did and was later amended, publish the amendment. If the original announcement was wrong, explain how such a consequential provision appeared in the official description of the agreement, and why it was so hastily done away with.

The original wording was quite specific. It expressly said a new term of up to 99 years would commence upon transfer or inheritance. The replacement terminology is just vague enough that it could end up meaning just about anything the two parties end up deciding on. The government says ownership of the underlying land remains with the Maldivian state, but formal title alone does not answer the central question.

The government must explain when each parcel ultimately returns to the state without outstanding private interests, whether rights granted late in the master lease can extend beyond the original term, what criteria govern approval of transfers, and what happens to purchasers and lenders if the master developer defaults.

A government can retain legal title while granting private rights so extensive and so long-lived that its practical control becomes severely limited.

These are not mere technical curiosities. They are the print that determines whether the state can ever recover practical control of the land.

Residency and the legal framework

The government must also explain the immigration and legal framework surrounding the project.

Will purchasing property in Rasmalé create eligibility for long-term residency? If so, for how long, under what conditions and for which family members? Will residency depend on continued ownership?

Will Rasmalé operate under the ordinary legal framework or a special economic regime? What taxes and fees will foreign purchasers pay? What exemptions, if any, have been promised? Will disputes between Eagle Hills and the government be resolved in Maldivian courts or through international arbitration, and have any stabilisation provisions been agreed to protect the project from future changes in tax, land or investment law?

These arrangements could bind future administrations for decades. They should be known before parliament is asked to change the law to accommodate them.

A bad deal for the Maldives

Agreements with up-front payments are not automatically superior; a government may rationally forego immediate cash if doing so creates greater long-term value. However, dredging Rasmale’ is an endeavor that has already cost us upwards of US$800 million. The total project cost will likely exceed US$1.4 billion.

The public has been forced into austerity measures under severe foreign-currency constraints, and access to foreign currency has never been more difficult. The currency spent on the project is currency that does not circulate in our economy. An upfront land premium or guaranteed dollar payment is a functional necessity given the economic conditions we face today.

Comparison with other Eagle Hills projects also raises alarm. These developments are not identical, and different governments contributed different land, infrastructure, tax concessions and financing. They do however, show that other states negotiating with the same developer have secured substantial ownership stakes.

In Albania, the government holds 33 percent of the company developing Durrës Yacht & Marina. In Georgia, the government agreed to hold a 33 percent stake in Eagle Hills’ Tbilisi and Gonio developments, announced with a combined investment value of US$6.6 billion. Serbia likewise retained a substantial minority interest in the Belgrade Waterfront.

The government could have negotiated equity, an upfront land premium, minimum guaranteed payments, a combination of equity and revenue share, or phased land releases tied to investment milestones. Yet the agreement seemingly contains none of these. It is the responsibility of the Muizzu administration to explain why.

What happens to the housing promise?

Rasmalé was presented to Maldivians principally as a solution to the Greater Malé housing crisis. President Muizzu’s 2026 presidential address said the first phase would offer 15,000 land plots in Rasmalé. Applications closed on 15 June with 22,575 applications for land plots and 35,930 applications for flats. The administration later expanded its stated Rasmalé housing ambition to 25,000 plots while maintaining that 15,000 would be distributed in the first round.

At the same time, more than 500 hectares are being committed to the Eagle Hills development. President Muizzu has said the remaining roughly 600 hectares will continue to be available for public housing and that reclamation will proceed.

That assurance should be tested against a published land-use plan showing where the first 15,000 plots will be located, how much land they require, how much must be reserved for roads, schools, hospitals, parks, utilities and other public infrastructure, how much remains unreclaimed, and when that reclamation will be completed. If hundreds of hectares originally reclaimed as part of the government’s housing programme are committed to a commercial project, the public deserves to know how the remaining land will satisfy the promises already made.

Why the secrecy?

When Eagle Hills signed development deals with Albania and Serbia, the terms were not treated like some saucy piece of gossip. In Albania, the parliament approved the deal before it went through. The Serbian government published their agreement in full. None of this is an argument against Eagle Hills or foreign investment.

A project expected to operate for decades requires political durability. The greater the investment and the longer the rights granted, the more important it is that the arrangement commands legitimacy beyond the government that signed it.

An unpublished agreement covering more than 500 hectares creates political risk for the investor itself. A future government faced with public anger over undisclosed terms will inherit obligations it did not negotiate and may face pressure to challenge them.

The only way to reduce this risk, is to disclose the agreement. An independent valuation shows the state understood what it contributed. Parliamentary and public scrutiny gives long-term arrangements greater democratic legitimacy. Clear contractual obligations protect Eagle Hills from arbitrary political claims just as they protect the Maldives from non-performance.

Transparency is not anti-investment. Rather, it is a critical part of ensuring that long-term developments of national consequence benefit both state and investor.

Publish the agreement

Five things are required before the deal proceeds:

The government must publish the commercial terms agreement, together with all schedules and annexes that can lawfully be disclosed.

It must explain why Eagle Hills’ original statement said a new lease term of up to 99 years would commence upon each transfer or inheritance, why that wording was removed, and whether the underlying agreement changed.

An independent international valuation of the more than 500 hectares must be commissioned and published.

The government must define the 10 percent revenue base and explain why it chose this structure over alternatives including equity, an upfront land premium and minimum guaranteed payments.

Parliament must not be asked to fundamentally alter land, property, residency or investment law to implement obligations that legislators and the public have not been permitted to examine.

The Maldives should welcome Eagle Hills and other credible foreign investors. We should compete aggressively for international capital. However, there is a fundamental difference between welcoming investment and negotiating public assets in secrecy.

We do not know what Maldives has committed, what the investor is legally required to deliver, when and how the state gets paid, and whether the land will ever return to Maldivian control.

More than 500 hectares of newly reclaimed land is an extraordinary public asset. A government confident that it has negotiated a good agreement should have no reason to hide the evidence.

Publish the agreement. Publish the valuation. Define the revenue share. Explain the changed 99-year language. Let Maldivians judge whether the deal is actually worth it.

Fayyaz Ismail is a former economic development minister and former chairman of the MDP. He is seeking the party's ticket for the 2028 presidential election.

All comment pieces are the sole view of the author and do not necessarily reflect the editorial policy of the Maldives Independent. If you would like to write an opinion piece, please send proposals to editorial@maldivesindependent.com.

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