The government has amended the Public Finance Regulation, enabling private sector participation in submitting proposals for projects aligned with development targets. The revised rules, distinct from specific government-mandated initiatives, now facilitate private entities in proposing projects without competitive bidding.
Under the updated Regulation, a framework is established for submitting proposals to the government without bidding or reliance on private initiatives. This marks a departure from the previous policy of non-invitational proposal submissions, reflecting a shift towards increased collaboration with the private sector.
During the administration of former President Ibrahim Mohamed Solih, rules were instituted allowing the President, in consultation with a Cabinet or Cabinet Committee, to assign projects funded by foreign countries or concessionary loans without the need for bidding.
The recent amendment by the Finance Ministry specifies the process for private sector submission of proposals for projects not officially announced by the government. According to the updated rules, projects can be awarded directly under private sector initiatives, subject to justification by the financially responsible head of an office to the finance minister, including details such as the type of work, cost, and designated personnel.
The amended regulations grant a cabinet or cabinet committee authority to approve private sector-led proposals. However, stringent criteria must be met for such proposals:
1. The proposal must align with the government’s development goals, even if not associated with a specific government project.
2. It should facilitate the government in achieving the outlined objectives of its Strategic Development Plan efficiently.
The rules also outline circumstances under which proposals cannot be submitted. Private sector submissions are precluded if a project related to the proposal is already announced or planned or the government actively seeks individuals.
Private companies must now submit project proposals to Investment Maldives, an entity under the Ministry of Economic Affairs. The evaluation process for these proposals involves three stages, culminating in the registration and agreement signing for the selected project during the third phase, as per the newly established rules.
