Gov’t Seeks Termination of Agreements for 22 Resort Islands

Tourism Minister Ibrahim Faisal informed Parliament that he has requested legal counsel from Attorney General Ahmed Usham regarding the potential termination of lease agreements for 22 islands due to a lack of development.

Faisal made this statement during a parliamentary session, today, responding to questions from South Maafannu MP Abdulla Rifau (Bochey). Rifau raised concerns over the absence of activity on several tourism-leased islands, years after their agreements were established. He queried Faisal about the reasons for this stagnation and the concessions offered by the government to encourage development.

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In his reply, Faisal acknowledged that there are 58 such islands, some of which have been leased for nearly 30 years. He noted that the Ministry of Tourism has engaged with the lessees to discuss their concerns.

According to Faisal, one of the primary issues faced by local lessees is the difficulty in accessing finance for island development. “From what we have observed, the main challenge is the lack of an investment bank in the Maldives. Local banks do not have the capacity to issue loans for the development of these islands,” he explained.

He expressed optimism that the recent establishment of the Development Bank of Maldives (DBM), which received its banking licence from the central bank last week, would help address these financial challenges once it becomes operational.

Faisal also mentioned that some islands are burdened with significant accumulated interest, making it difficult to develop and market them unless the government offers concessions on payments.

While Faisal confirmed that the Ministry has sought legal advice regarding the termination of leases for 22 islands, he did not disclose the specific islands involved.