Full ownership and control of the properties in the Rasmalé waterfront development will remain with the Maldivian state, and the project has been planned to bring the greatest possible economic benefit to the state, Housing Minister Dr. Abdulla Muththalib has said.
The minister made the remarks while speaking at the Maldives Accountants Forum, where he gave a special presentation on the government's work towards its goal of making the Maldives a developed country by 2040.
Minister Muththalib said the best way to grow the economy of a country with a population of around 400,000 is to make good use of its natural beauty and its security as a nation.
He noted that real estate tourism is a model used with great success in developed countries, and said the government is carrying out special work to further expand and develop the sector in the Maldives.
Highlighting the importance of developing properties within the legal framework in ways that bring the highest possible revenue to the state, the minister said that developing properties leased for 99 years through joint ventures, with or without equity, is financially the most beneficial approach for the state.
He also said that the best arrangement for the country is one in which ownership and control of such projects remain with the state, with every transaction bringing in reasonable revenue for the state.
Referring to the financial figures, the minister said the state is expected to earn US$3.1 billion, as 10 percent revenue, from the first transactions alone of the more than 8,800 properties to be developed in Rasmalé.
He added that because any change in ownership of these properties must be carried out through the government, the government will continue to earn additional revenue from every future transaction.
By way of comparison, the minister said that when a 500-hectare lagoon or plot of land is leased for 99 years under the Tourism Act, the state receives between US$75 million and US$316 million as acquisition cost, in addition to US$2 million a year in rent.
Once the Rasmalé project is complete, however, the island alone is expected to attract one million tourists a year, bringing US$2 billion a year into the economy, he said. The minister also said that the revenue the state earns per hectare in tourism goods and services tax (TGST) would increase eightfold compared with existing properties in the Maldives.
Leave a reaction