Thirteen islands to be re-developed as tourist resorts make payments

Thirteen islands leased as picnic islands have paid their initial payment to extend leases by 50 years and to be re-developed into tourist resorts.

In 2010, the Maldivian Democratic Party (MDP) government had called the 18 existing picnic islands to extend their lease agreements and their subsequent development into tourist resorts.

Tourism Ministry’s Assistant Director General Hassan Zameel told Sun today that they have signed lease agreements with two parties who are seeking to re-develop their picnic islands into tourist resorts, while 13 other such parties have made their initial payments to the government.

“They have paid 20 percent of the conversion fee to the government, and it was agreed that they would pay the remainder within a three year period,” he said. “This change to the agreement will increase government's revenue by a number of folds. Before this, the government was getting less than $300,000 per year from these places. But now, they’ll also have to pay the same rent as other tourist resorts, as per the Tourism Act.”

Zameel said that the companies are first required to sign a joint venture agreement with the Ministry of Finance before signing their lease agreement with Ministry of Tourism, Arts and Culture.

Senior Legal Officer at the Tourism Ministry Faseeh Zahir said the new agreement will require the islands to be open for public to access, although the picnic islands are being converted into tourist resorts.

Faseeh also said that the government share has been increased to 10 percent in the new joint venture companies, as opposed to the previous share of 5 percent.

“The previous government had decided that the government share would be 5 percent. But the government has now decided to increase it to 10 percent. The recent JV (Joint Venture) agreements will be the same,” Faseeh said.

The picnic islands granted for redevelopment include, amongst others, the local picnic island of Kuda Bandos located near Male’, Olhahali island, Maadhoo Finolhu and Vaagali.

Government has also leased Kaafu Kohdhipparu for resort development in exchange for the construction of 100 housing units in Hulhumale’.

Government has stressed that the local picnic island of Kuda Bandos will still be open to the public after reconstruction.