Maldives to introduce an investor residency program

The Maldives’ cabinet is set to discuss a proposal to introduce a residency program for major investors during a meeting on Sunday.

Investor residency programs are run in several countries to attract major foreign investments, allowing individuals who make substantial investments to more quickly gain residency rights in countries.

In a video message ahead of Sunday’s meeting, President Dr. Mohamed Muizzu said the cabinet will discuss introducing an investor residency program in the Maldives, similar to those run in developed countries. He said the move was part of the government’s efforts to accelerate economic diversification.

“Something different, but something crucial to the development of the Maldives. And this is something that several developed countries practice,” he said.

President Muizzu said that such programs are run in Singapore and in Dubai in the United Arab Emirates (UAE).

However, he did not disclose any details regarding how such a program will be run in the Maldives.

The cabinet is also set to discuss the merger of six state-owned enterprise. As such, the items in the agenda for Sunday’s meeting includes:

• Discussions regarding making the Regional Airports Company Limited (RACL) a subsidiary of the Maldives Airports Company Limited (MACL)
• Discussions regarding making merging the Fahi Dhiriulhun Corporation (FDC) with the Housing Development Corporation (HDC)
• Discussions regarding merging the Maldives Fund Management Corporation and the Business Center Corporation (BCC)

ވަޒީރުންގެ މަޖިލީހުގެ ބައްދަލުވުން ކުޑައިރުކޮޅެއްގެ ތެރޭގައި ފެށޭނެ pic.twitter.com/Ptjf8Xkcka

— The President's Office (@presidencymv) September 1, 2024

At present, the RACL operates regional airports in the country while the MACL runs the country’s national airport, the Velana International Airport (VIA). And HDC and FDC are both housing corporations with a similar mandate.

Last week, the cabinet decided to make Fenaka Corporation, a state utility company which has racked up debt, a subsidiary of the State Trading Organization (STO).

The merger of insolvent SOEs with larger more profitable SOEs is a component of the austerity measures announced by the Maldivian administration to improve the state’s cashflow.

The government has announced a string of measures to cut costs and boost revenue. This includes legal revisions to reform Aasandha, introduce targeted subsidies, and have companies that earn US dollar revenues pay taxes in US dollars.

With the country’s rising external debt servicing obligations, Fitch has downgraded Maldives’ credit rating from ‘CCC+’ to ‘CC’, warning of an increased risk of default.