The government will charge a US$25,000 application fee from potential investors in its flagship Special Economic Zones.
Accepted applicants are also required to pay a US $1 million guarantee to a bank account of the board’s choice within 15 days of receiving the initial permit, under the new SEZ investment board regulations.
The regulations, published on April 2, set out the terms for a programme that the government hopes will bring in $100m by August. It has so far signed one memorandum of understanding for an SEZ.
The regulations give the President the authority to appoint the board’s chair, vice-chair and to dismiss board members at any time.
They also give the board the power to freeze potential investors’ local assets if the permit is terminated and the investor has any outstanding debt. The board will have the discretion to cancel all visas to migrant workers if a permit is terminated.
Speaking to Minivan News, Economic Council co-Chair and Tourism Minister Ahmed Adeeb said the government is “looking for serious investors”, pointing out that the minimum investment for a SEZ stands at US$ 150 million.
Adeeb said the application fee was set after consulting with investors, and that processing these proposals is hard work.
President Abdulla Yameen has previously declared that the SEZ act would become “a landmark law” that would strengthen the country’s foreign investment regime.
The only SEZ activity since the act was ratified by President Yameen in August 2014 has been a memorandum of understanding for a Dubai Ports World free trade port.
Adeeb said, however, that there is a lot of support for the SEZs, pointing out that Indian investors have shown interest in building a gold refinery after Maldives granted duty free status to gold.
The government estimates that it will be able to acquire over US $100 million in acquisition fees from the SEZs by August 2015.
The US$100 million figure has been included as one of three revenue-raising measures in the 2015 annual state budget, alongside increasing import duties and taxes.
“I think we will meet budget targets. Some investors are prepared to pay a US $100 million acquisition fee on a single project,” said the tourism minister.
The first SEZ project is likely to be the Dubai Ports World free trade port in Thilafushi in Male’ atoll, followed by the mega I-haven port project in the north, Adeeb added.
The government signed an MoU with the Dubai company on the port on March 19, while it is still seeking investors for the I-haven project on the northernmost Ihavandhihpolhu (Haa Alif) atoll.
During parliamentary proceedings, the opposition Maldivian Democratic Party (MDP) submitted more than 300 amendments to the SEZ bill.
The MDP claimed that the law would pave the way for money laundering and other criminal enterprises, while authorizing the president to “openly sell off the country” without parliamentary oversight.
The government, however, maintained that SEZs with relaxed regulations and tax concessions were necessary to attract foreign investors.