Islands on offer for resort development under cross-subsidy policy

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The tourism ministry on Sunday (25 December) added a new island and lagoon to the list of uninhabited islands to be leased for resort development under the government’s cross-subsidy policy.

The current administration plans to lease islands, lagoons or plots of land for tourism in exchange for investment in infrastructure projects. 

“The total investment proposed or committed under this model shall be set-off against the acquisition cost and/or the declared land rent of the island/land/lagoon allocated for tourism under this model,” according to the ministry of national planning, housing and infrastructure.

With the addition of Dhekennafaru island and Dhigaru lagoon in Noonu Atoll, seven islands and a lagoon are now on offer for potential investors. The other islands are Shaviyani Kudalhaimendhoo, Noonu Kunnamalei, Lhaviyani Meyyafushi, Thaa Dhiffushi, Thaa Kalhufahalafushi, and Gaafu Alifu Fulagi.  

Last week, the cross-subsidy rules were revised to hand over islands or lagoons after an initial payment of US$1 million. The regulations previously required full payment of a project’s funding.

The change was made after the infrastructure ministry signed financing agreements with four companies to build new domestic airports. A dozen contractor financing proposals were submitted after the minimum financing amount was reduced from US$5 million to US$3 million. The bid announcement was made for the third time last August.

New airports are to be developed on the islands of Haa Dhaalu Makunudhoo, Shaviyani Bilehfahi, Baa Thulhaadhoo, Thaa Vilufushi, Faafu Magoodhoo and south Raa Atoll (location to be decided upon).

Earlier this month, the government invited expressions of interest or proposals to develop a residential city in the Giraavaru lagoon near Malé. A minimum financing requirement was set at US$5 million.