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.”