Crisis-hit Maldives Get $8.8 billion in Qatar Investment
AFP staff worker
Colombo (AFP) May 5, 2025
The cash-strapped Maldives has signed an agreement with a Dubai-based company to create a $8.8 billion investment zone aimed at diversifying tourism hotspots into “financial freezing zones,” the government said on Monday.
The office of Mohamed Muizzu said in a statement that three residential and office towers, conference centers and hotels will become part of the Maldives International Financial Centre (MIFC).
“It will … position men as the premier global commercial and financial hub in the Indian Ocean,” the statement said, adding that this will allow the Indian Ocean archipelago to “diverse tourism.”
Maldives’ $6.5 billion economy has been facing foreign exchange shortages since the Alliance’s pandemic on the 19th and has been warned of a potential foreign debt crisis.
The news comes after an agreement signed with MBS Global Investments late Sunday, a company owned by wealthy actari Sheikh Nayef bin eid althani.
The MIFC District will have no residence requirements and offer “no corporate taxes, tax-free inheritance… and privacy.”
The government said it expects revenue to be completed by 2030 and “will exceed $1 billion by the fifth year.”
In February, the International Monetary Fund said that despite the booming tourism industry, the Maldives needed an “urgent, stronger” fiscal merger to stabilize its troubled economy.
Upscale vacation destinations are expected to grow by 5% in 2025, but the International Monetary Fund warns that the sunny appearance masks significant risks.
The small country rejected the International Monetary Fund’s bailout loan late last year, while the government announced serious spending cuts.
Muizzu cuts 50% of the cuts and offers 10% of the salary in most public sector jobs.
In September, the Maldives described its financial difficulties as “temporary” and said there were no plans to seek bailouts, despite warning of possible sovereignty breach.
The Maldives is on the frontline of a battle against global warming, which could raise sea levels and submerge countries scattered across the equator’s 1,192 small coral islands.
China and India are the two largest bilateral lenders. Since Muizzu’s 2023 election victory, Beijing has pledged further funding, and the president thanked China for its “selfless assistance” when providing development funds.
Prime Minister Narendra Modi welcomed Muizzu in New Delhi in October, who announced financial support to strengthen the archipelago’s struggling economy.
Official data show that the Maldives’ foreign debt was US$3.37 billion in the first quarter of 2024, equivalent to 45% of GDP.
China accounts for about 20% of foreign debt, while India holds less than 18%.
Related links
Bring order to disaster
A world of storms and storms
Earthquake
