The government today withdrew at the preliminary stage a bill to abolish the Foreign Investment Act of 1979, one of 18 pieces of legislation proposed under its economic reform package currently before parliament.
Presenting the draft legislation in August, MP Alhan Fahmy of the ruling Maldivian Democratic Party (MDP) said the purpose of the bill was to remove restrictions and open the country to unhindered investment by foreign companies.
Alhan announced today that the ruling party decided to pull out the bill in light of parliament rejecting the proposed company law last week.
“It is not that our thinking and economic policy has changed at all,” he said, adding that all components of the reform package was necessary to achieve the government’s objectives.
Foreign direct investments were to be regulated under the proposed company law, which would have replaced the existing Companies Act enacted in 1996.
In a booklet issued to the media by the Dhivehi Rayyithunge Party (DRP) outlining concerns with the economic reforms, the main opposition party opposed the abolition of the Foreign Investment Act on the grounds that it protected domestic industries and small businesses.
The party noted that the proposed company law did not contain protectionist measures or special benefits for local businesses.
“Instead of abolishing the foreign investment law, it would be better to amend and modernise it to pave the way for foreign investments in the country,” it reads.
Moreover, the DRP “could not agree to sell the country’s remaining assets to the MDP’s friends” after “[losing control of] the country’s main gate, the international airport, the national telecom service, and Maldivian seas and shallows.”
During the preliminary debate in August, Kelaa MP Dr Abdulla Mausoom, recently appointed DRP parliamentary group deputy leader, accused the government of trying to turn the Maldives into the “money-laundering machine of the world” by deregulating or removing restrictions to foreign investments.
Other opposition MPs claimed that the bill was part of an agenda to “sell off state assets” and undermine national interests and sovereignty.