Tag: china

India grants further US$25million to Maldives

India has granted a further US$25million to the Maldives as part of the $US100million standby credit facility agreed during last November’s official visit from Prime Minister Manmoham Singh.

Indian High Commissioner D M Mulay signed the agreement with Minister of Finance and Treasury Abdulla Jihad at the Indian High Commission, local media reported.

Mulay, who was not responding to calls at the time of press, said that the deal represented the third instalment of the credit facility, with the previous two instalments having amounted to US$50million.

The previous tranche of US$30 million was released following President Waheed’s first official visit to India in May.

Mulay is also reported to have said that the rest of the promised credit will soon be handed to the Maldivian government:  “The paperwork on the agreement is being processed now, the amount will soon be awarded to the Maldives,” Haveeru quoted Mulay.

A standby line of credit is normally forwarded to countries which have reached macroeconomic sustainability but experience short term financing issues.

The release of this credit comes just days after Waheed completed his first official state visit to China.

During this trip, Waheed finalised agreements for a US$500 million Chinese loan with the assurance of more aid available when needed.

The loans, equal to nearly one quarter of the Maldives’ GDP, are said to include $150 million (MVR2.3billion) for housing and infrastructure, with another $350million (MVR5.4billion) from the Export-Import Bank of China, reported Reuters.

Jihad told Minivan News last week that, despite securing this money from China, the government would still be considering austerity measures which are being considered in order to reduce the state’s budget deficit.

With income lower and expenditure higher than predicted, this year’s budget deficit had been forecast to reach MVR9.1billion (US$590million), equivalent to around 28 percent of nominal GDP.

India has traditionally enjoyed close ties with the Maldives, although there have been increasingly strong links between the Maldives and China, largely due to the number of Chinese tourists visiting the Indian Ocean nation.

A Chinese embassy opened in Male’ in time for the opening of the SAARC summit last November, reciprocating the opening of a Maldivian mission in Beijing in 2007.

Indian officials were reported at the time as having concern that the move was part of China’s “string of pearls” policy which supposedly involves Chinese attempts at naval expansion into the Indian Ocean.

After the awarding of the Chinese loan, however, former Foreign Minister and current UN Special Rapporteur to Iran, Dr Ahmed Shaheed was keen to play down any suggestions that the Maldives was about to significantly change its foreign policy priorities.

“This is very much in keeping with past policy. The lines so far drawn have demonstrated that the Maldives remains primarily SAARC focused, followed by trading partners in the EU and Singapore. China has moved into this second category,” he added.

“Nothing will change the fact that we are only 200 miles from Trivandrum,” said Shaheed.

When asked upon his recent return from Sri Lanka what the Maldives’ policy was regarding Sino-Indian competition in the region, President Waheed is said to have responded that the policy of a small nation like the Maldives ought to be to avoid too great an involvement in geopolitics.

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Chinese aid not limited to US$500 million loan: Waheed

Speaking upon his return from China yesterday, President Dr Mohamed Waheed Hassan told reporters that Chinese aid to the Maldives will not be limited to the US$500million (MVR7.7billion) loan finalised last week.

Waheed revealed that the Chinese government had pledged to make all necessary aid available to the Maldives, including assistance with road and shipping development, reported Haveeru.

The President expressed his hope that his meeting with Chinese businessmen would result in harbor development projects in the Maldives.

Regarding China’s view on Maldivian politics, Waheed noted that the Chinese were amongst the first nations to recognise his unity government.

“The Chinese Prime Minister personally told me that he had full confidence and support for the Maldivian government,” Waheed was reported as saying.

When speaking with Xinhua before his trip, Waheed praised China’s policy of non-interference in foreign affairs.

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Indian Aviation Minister urges resolution of GMR dispute

Indian media outlets have reported that the country’s Minister for Civil Aviation Ajit Singh has asked the Maldives to consider ways to resolve ongoing disputes with Indian company GMR regarding the development of Ibrahim Nasir International Airport (INIA).

The Economic Times reported that the issue arose during a meeting with the Aviation Minister and a Maldivian delegation led by the Maldives’ Minister for Transport and Communication Dr Ahmed Shamheed.

The paper said that an official statement from the Civil Aviation Ministry had highlighted the major issues discussed:

“The contentious issues include provision of airport development charges provided for in the agreement with the GMR, but termed as unauthorised by a local court in the Maldives, and a demand for an additional runway not provided in the agreement,” the statement is reported to have said.

The development of the airport – expected by the company to total US$511m in costs – is the largest foreign investment project undertaken in the Maldives’ history and includes commitments to complete the renovation of INIA’s existing terminal this month.

The issues detailed during the meeting have been compounded in recent months by government aligned parties calling for nationalisation of the airport as well as orders to halt construction work following allegations of missing permits.

CEO of GMR Maldives operations Andrew Harrison today told Minivan News that the government had informed the company it had complied all regulations, but had not yet given it the go-ahead to resume work.

“We have not done any work since August 2,” said Harrison.

During a visit to India last month, leader of the government aligned Dhivehi Rayyithunge Party (DRP) Ahmed Thasmeen Ali warned of serious repercussion for investor confidence should the country renege on the GMR deal.

Sri Lankan media this week has also reported Business Council leader Hussain S Hashim as saying that a lack of trade dispute mechanisms in the Maldives was stifling bilateral trade.

Travel Daily India reported that additional measures to strengthen bilateral ties in the aviation sector were discussed during the meeting.

Increasing air links between Indian cities and the Maldives was a topic reportedly discussed. It was reported that Island Aviation, Spice Jet, and Mega Maldives are all planning to connect Mumbai, Delhi and Chennai with Male’.

Changes to the countries’ aviation agreement was also mentioned in Travel Daily, with the current rules only allowing flights with carrying capacities of less than 150 passengers.

“India will relook the agreement which will help in boosting tourism between the two countries,” Singh is reported to have said.

During his official visit to India in May, President Dr Mohamed Waheed Hassan spoke of his desire to bring more Indian visitors – who currently represent only 2.9 percent of the market share – to the Maldives.

“Not enough Indian tourists are coming to the Maldives and that is a matter of concern for us. I am sure it is also a matter of concern for India, particularly when you realise that there are so many Chinese tourists who are coming to the Maldives now,” Dr Waheed told India’s Business Line.

Whilst Dr Shamheed is in India, a number of his fellow cabinet ministers have accompanied President Waheed on his official state visit to China.

Yesterday, the President’s Office website reported that Waheed had met with members of the business community in Shanghai.

Waheed is reported as having said that investors were always welcome in the Maldives.

“Maldives is open for business,” Waheed told those in attendance at the opening of the China-Eurasia Expo & the 2nd China-Eurasia Economy Development and Cooperation Forum.

The highlight of Waheed’s first trip to China as President has been the finalising of a $500million (MVR7.7billion) package of aid, concessional loans, and loans for housing construction.

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President speaks at China-Eurasia Expo

President Dr Mohamed Waheed Hassan has spoken at the opening of the opening of the 2nd China-Eurasia Expo & the 2nd China-Eurasia Economy Development and Cooperation Forum, as part of his official state visit to the country.

“As China continues to make great strides in the various facets of its development, it has indeed become an outstanding example of the good international citizen,” said Waheed.

“The Maldives has always looked to China as an invaluable friend. As we celebrate the 40th anniversary of diplomatic relations this year, the contribution from China to the social, cultural and economic development of our country is immense and numerous.”

“For over two decades, China has supported housing development in the Maldives, along with other infrastructure projects. The support towards promoting athletics and other sports as well as cultural cooperation is noteworthy.”

“We recognize China as one of the leading economic powers globally, and we are keen to strengthen our relationship with the country. Maldives has always promoted an open economy with liberal trade and investment policies. We are happy to note that we maintain one of the most liberal trade regimes in the SAARC region.”

“To further strengthen our investment policies, the Government is taking steps to further improve the legal and regulatory framework governing private sector growth and foreign direct investments. Maldives is open for business and it is with pleasure that I note, companies from China are already involved in Maldives.”

“I call upon potential investors to consider Maldives as an attractive investment destination in addition to a popular tourist destination. Potential opportunities are available in real estate development, especially residential and mixed development projects, public infrastructure projects as well as investments in the tourism sector.”

The President’s Office has reported that Waheed is scheduled to meet Chinese Premier, Wen Jiabao, who was also present at yesterday’s opening ceremony.

Also in attendance was the President of Krygyzstan, and the Prime Minister’s of Kazakhstan, Cambodia and Tajikistan

Before leaving, the President also announced that he expected to finalise arrangements for a $500 million loan from the Chinese government. Local media has today confirmed that an agreement has been signed.

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The Maldives’ foreign relations and the CNI

“It was just a week ago that Maldivian President Dr Mohamed Waheed was in Colombo, meeting diplomats, businesspeople and the media on a mission to strengthen the existing friendly relations between Sri Lanka and the Maldives,” writes Lasanda Kurukulasuriya for Sri Lanka’s Sunday Times.

“The visit came just days ahead of the release of a report by a commission appointed to investigate the controversial circumstances in which he, as deputy to former president Mohamed Nasheed, assumed office as President of the Maldives in February.”

“The travel destinations of the Maldivian political leaders (past and present) point to their keen awareness of the geostrategic imperatives in the region. For the small Indian Ocean archipelago these considerations dictate that the support and goodwill of its close South Asian neighbours need to be maintained, whilst simultaneously fostering good relations with China.”

“President Waheed when he visited in May sought to reassure Delhi that ‘China will not replace India.’ But the Maldives, just like others, wants to develop trade links with the economic powerhouse.”

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Waheed says China to grant Maldives $500 million loan

President Dr Mohamed Waheed Hassan has told Reuters that China will grant the Maldives US$500 million (MVR7.7billion) in loans during his state visit to the country.

The loans, equal to nearly one quarter of the Maldives’ GDP, would include $150 million (MVR2.3billion) for housing and infrastructure, with another $350million (MVR5.4billion) from the Export-Import Bank of China, reported Reuters.

This state owned bank is mandated with facilitating the export and import of Chinese products and promoting Sino-foreign relationships and trade, according to its official website.

China’s aid may provide an immediate salve to the government’s financial ailments which are on track to leave a MVR 9.1 billion ($590million) deficit in this year’s budget.

Former Foreign Minister and current UN Special Rapporteur to Iran, Dr Ahmed Shaheed, explained that it was unlikely China would give any money to the Maldives as cash, suggesting that it would more likely come as assistance in kind, which was often difficult for the economy to “absorb”.

Shaheed said that the loan should not be interpreted as a change in foreign policy after former President’s Nasheed and Gayoom both recognised the importance of cultivating ties with China.

“This is very much in keeping with past policy. There has been a growing Chinese interest in the Maldives – a relationship based on trade, tourism and political contact,” said Shaheed.

“The lines so far drawn have demonstrated that the Maldives remains primarily SAARC focused, followed by trading partners in the EU and Singapore. China has moved into this second category,” he added.

“Nothing will change the fact that we are only 200 miles from Trivandrum,” he said.

A Chinese embassy opened in Male’ in time for the opening of the SAARC summit last November, reciprocating the opening of a Maldivian mission in Beijing in 2007.

Indian officials were reported at the time as having concern that the move was part of China’s “string of pearls” policy which supposedly involves Chinese attempts at naval expansion into the Indian Ocean.

On this matter, Shaheed acknowledged that India would be worried about Waheed’s arrival in Beijing after its apparent diplomatic failings during the Maldives’ recent troubles.

However, Shaheed said that a genuine policy shift would have to involve enhanced military cooperation, something avoided by former President Nasheed after his predecessor had shown some interest.

“Nasheed understood that the Maldives should not become a playground for the big powers,” he said.

Similarly, when asked upon his recent return from Sri Lanka what the Maldives’ policy was regarding Sino-Indian competition in the region, President Waheed is said to have responded that the policy of a small nation like the Maldives ought to be to avoid too great an involvement in geopolitics.

Waheed’s first official state visit after becoming president saw him travel to India in May. The Maldives National Defence Force (MNDF) conducted joint naval operations with India in the same month.

More recently, Waheed has visited the United Kingdom, Saudi Arabia and Sri Lanka.

The vast rise in the number of Chinese tourists visiting the Maldives was a point Waheed was keen to make to both Reuters and the Chinese state news agency, Xinhua.

“The purpose of this visit is we have a growing relationship with China,” Waheed told Reuters. “The most tourists from one nation are coming from China. So it is really important to have a good relationship and to also encourage Chinese tourists to continue to come to the Maldives.”

China leapfrogged the United Kingdom in 2010 to become the number one source of arrivals for the country’s travel industry.

Official figures from the Maldivian Ministry of Tourism reveal that China has provided 22.2 percent of all arrivals to the Indian Ocean nation this year – up 14.5 percent from last year.

When speaking with Xinhua, Waheed thanked the Chinese for choosing to visit the Maldives before going on to give praise to China’s policy of non-interference in foreign affairs.

Waheed has been critical of the Commonwealth’s role in the country’s recent political turmoil, suggesting that the organisation’s calls for early elections were “premature”.

In a comment piece for local newspaper Haveeru this week, Waheed’s Special Advisor Dr Hassan Saeed said that the Maldives should not tolerate interference from people “who fail to practice what they preach in their own country.”

“We need to have the confidence to challenge those diplomats and politicians in the international community who sometimes seem to let their personal political sympathies determine their approach to our problems,” said Saeed.

Xinhua reported that Waheed had lauded China for understanding the international affairs of smaller countries.

“China is emerging as one of the superpowers now. In that sense, it will inevitably play a significant role in world affairs,” said Waheed.

On this point, Shaheed argued that the mention of ‘non-interference’ alongside ‘world power’ was a non-sequitur.

“The world has moved on from this approach. It is now state business to interfere when partners appear to have violated agreements,” he said.

Shaheed added that praise for a host country’s policies was standard in these instances, “a nicety”, and suggested that people should “not read too much into it.”

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Waheed to visit China to enhance trade

President Mohamed Waheed Hassan has revealed his plans to visit China on an official state visit next week, highlighting the continued significance of the nation to Maldivian interests.

“China is a fast developing nation and most products are being made there. Both small and larger countries are trying to establish trade ties with China. Hence we should also follow suit,” Waheed told local media upon his return yesterday from a state visit to Sri Lanka.

The last official state visit by a Maldivian President to China came in May 2010 when Mohamed Nasheed visited the Shanghai World Expo.

Nasheed met Chinese President Hu Jintao during his trip, Dr Waheed is himself reportedly expecting to meet Prime Minister Wen Jiabao next week.

The Foreign Ministry has said that more information about the visit would be released to the media in the coming days.

Ministry of Economic Development’s figures show that imports from China have more than doubled between 2010 and 2011, reaching US$68.9 million dollars.

Maldivian exports to China were reported to total just $26,000 last year, consisting largely of fisheries products.

Vice President of the Maldives National Chamber of Commerce and Industries (MNCCI) Ishmael Asif explained that the potential of Sino-Maldivian ties could be better realised through increased awareness of nature of the island nation.

“The Chinese are yet to understand logistics in the Maldives, including its politics,” he said. “We are trying to educate them on these things.”

He added that efforts were already being made in the field of education in order to “help us understand one another’s culture.”

In addition to trade ties, China has become increasingly important to the Maldives’ in terms of interest from tourists.

China leapfrogged the United Kingdom in 2010 to become the number one source of arrivals for the country’s travel industry.

Official figures reveal that China has provided 22.2 percent of all arrivals to the Indian Ocean nation this year – up 14.5 percent from last year.

“Most tourist arrivals to the Maldives are from China. More than 200,000 tourists come to the Maldives from China. Hence we must establish a close relationship with the country,” Waheed told reporters yesterday.

Asif added that there were great possibilities for Chinese investment in the Maldives’ tourism sector.

“For example, we have no Chinese hotel in the Maldives,” he said. “They are very interested in investment.”

The MNCCI  – whose remit is to promote trade and business in the Maldives – has had an office in Chengdu for two years. Chengdu, in Szechuan province, is the departure point for most Chinese visiting the Maldives, explained Asif.

In the wake of the rapid expansion in tourism links, closer ties have developed in the fields of aviation and diplomacy.

The rise of Mega Maldives Airlines has been particularly notable in recent years. The company, started in 2010, has more than doubled in size in the last year – operating charter flights between the Maldives and five Chinese destinations, as well as Hong Kong.

In April, the company conducted a travel road show in partnership with the Maldives Ministry of Tourism.

The company reported the cancellation of some flights after the political unrest in the Maldives in February. Although arrivals figures bounced back, the Maldives still remains on the Hong Kong Security Bureau’s travel alert system.

Disturbances in the capital at the time included the destruction of the National Museum’s pre-Islamic display. The Museum itself was a gift from China in 2010.

A Chinese embassy opened in Male’ in time for the opening of the SAARC summit last November, reciprocating the opening of a Maldivian mission in Beijing in 2007.

Indian officials were reported at the time as having concern that the move was part of China’s “string of pearls” policy which supposedly involves Chinese attempts at naval expansion into the Indian Ocean.

When asked by a reporter what the Maldives’ policy was regarding Sino-Indian competition in the region, President Waheed is said to have responded that the policy of a small nation like the Maldives ought to be to avoid too great an involvement in geopolitics.

Waheed’s first official state visit after becoming president saw him travel to India in May. The Maldives National Defence Force (MNDF) conducted joint naval operations with India in the same month.

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Mega Maldives expands fleet with Boeing 757

Mega Maldives has announced an expansion of its fleet with the acquisition of a Boeing 757-200ER aircraft to aid the possible operation of services to a wider number of destinations from the country.

According to the company, which presently operates two 767 jets, the new aircraft is set to come into service this month to support the groups’ existing services from Male’ to Hong Kong, Chongqing and Chengdu.

In April, Mega Maldives joined forces with the Maldives government and the wider tourism industry to conduct a travel roadshow to promote the destination on a whistle-stop tour of five Chinese cities in one week.

The tour was part of attempts to counter the negative impacts of international news coverage concerning the destination after February’s controversial transfer and help the industry meet its aims of attracting a record 1 million visitors to the Maldives during 2012.

MEGA Maldives Airlines CEO George Weinmann claimed that as well as bolstering the group’s ability to provide existing services, the aircraft could also form part of plans to expand to new markets.

“The 757 will allow us to serve markets with more frequency and to open up smaller markets with non-stop direct service,” he said. “The aircraft’s long range capability – which can reach as far as Beijing, China; Perth, Australia; and Johannesburg, South Africa make it a very flexible choice as well.”

The company said it remained committed to expanding mew routes “to widen” the aviation and tourism industries in the Maldives.

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Maldives Tourism Board opens offices in Beijing in Shanghai

TTG Asia travel magazine has reported the opening of Maldives Tourism Promotion Board offices in Beijing and Shanghai.

Chen Xueyu, secretary-general of the Shanghai Tourism Trade Association, told TTG that the Maldives was one of the most popular tourist destinations among Shanghai’s population.

Zou Qingling of Shanghai Spring International Travel Service, said that the Maldives was the “first-choice destination for (Chinese) honeymooners”, anticipating that numbers would continue to grow at 20-30 percent per year.

The Ministry of Tourism took part in a travel roadshow in conjunction with Mega Maldives airlines which flys tourist to the Maldives from 6 Chinese destinations. The tour aimed to publicise the industry’s aims to attract a record 1 million visitors this year as well as to encourage Chinese investment in the Maldives.

Last year, the number of visitors from China surpassed those from Britain, reaching 198,000. Statistics from the ministry show that Chinese tourist arrivals are up 12.6 percent this year compared with the same point last year.

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