New amendments to FDI policy allow foreign companies to operate airports

Amendments have been brought to the Maldives' Foreign Policy such that 100 percent foreign-owned companies can operate airports in the Maldives.

According to the changes brought to the Foreign Direct Investment (FDI) Policy, companies that are owned 100 percent by foreign parties can operate Maldives' airports. The amendment was published in the gazette on Sunday at a time when India's EXIM bank has made the decision to invest in the development of Hanimmaadhoo International Airport and Seenu Gan International Airport.

As per amendments brought to Annex 1, Code H3 of the FDI policy by the Economic Ministry in February last year, 75-percent of foreign-owned companies can operate Maldives' airports and can offer freight services. A minimum initial investment of USD 5 million is required if such companies wish to operate the airports for over five years.

However, the new changes to the FDI Policy will allow companies that are 100-foreign-owned to operate and manage the airports. Additionally, runway and passenger terminal operation as well as air traffic control services, ground services, and airfield services can be offered by the companies. Airports may be leased to such companies for up to 50 years.

Many have voiced concern over the new amendments, stating that it endangers the country's national security. The opposition has called for President Ibrahim Mohamed Solih to be impeached over the amendments and has said the amendments must be reversed immediately.

However, Econmic Minister Fayyaz Ibrahim has clarified that the recent amendment to Foreign Direct Investment does not allow operation of air traffic by private investors whether foreign or local. In any airport in the Maldives, air traffic services will be conducted by the State. He assured that the wording in the amendment will be changed to remove any misunderstanding.