Gov't says Rasmale' agreement ensures no foreign land rights, no automatic extensions

The government says that under the real estate project to be implemented by Eagle Hills in Rasmale', no land lease will be automatically renewed and no foreign party will be permitted to own land in the Maldives.

This was declared in the official response to a letter sent by North Galolhu MP Mohamed Ibrahim (Kudu) to the Ministry of Infrastructure, Housing and Urban Development regarding the Rasmale' project.

According to the ministry’s reply, a set of “commercial terms” has now been agreed with Eagle Hills International Properties of the United Arab Emirates to develop a real estate project on 500 hectares of land in Rasmale'. The ministry assured that all land-lease transactions will be carried out strictly in accordance with the Constitution, laws and regulations of the Maldives.

“No property will be automatically renewed under this agreement. No property will be owned by any foreign party under this agreement. No property will be leased outside the bounds of Maldivian law,” the government’s response stated.

The government added that the main agreement will be signed in line with national laws, noting that leasing state land and lagoons for various purposes has long been a common practice in the Maldives.

The ministry further stated that the project is being implemented under the Procedure on Private Initiated Proposals (PSIP Procedure) of the State Finance Regulations, following a two-pronged approach consistent with international best practice.

The government said the agreement will yield substantial financial benefits for the state. As such, the state is expected to receive an estimated 10 percent, approximately USD 3.1 billion, of the developer’s total revenue as land premium, of which USD 500 million has been earmarked for advance spending on government housing projects. In addition, the state will receive four percent of the market value of units sold in Rasmale'.

The government also noted that no import-duty exemptions will be granted for the project, unlike in the tourism sector, and that all foreign-exchange flows will remain within the local economy as financial transactions will be conducted through banks established in the Maldives.