Gov’t to Shift Exim Bank Funds from Gulhifalhu to Other Projects

The Finance Ministry has announced a strategic shift in the allocation of funds initially earmarked for the commercial port project at Gulhifalhu. The USD 400 million (MVR 6.1 billion) required for the port, which was to be financed through a USD 800 million credit line from the Exim Bank of India, will now be diverted to other developmental projects in the Maldives.

This decision follows the government’s change of plan regarding the location of the new port. Initially, the port was set to be built in Gulhifalhu, a decision supported by the previous administrations under President Abdulla Yameen and continued under President Solih. However, the current government has now opted to establish the port in Thilafushi, an area initially reserved for other developmental activities.

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In a statement to the press, Finance Minister Dr Mohamed Shafeeq confirmed that the funds allocated for the Gulhifalhu project would be repurposed for other national projects. “No funding will be lost, and the money will be distributed to implement the most useful projects for the people and the economy,” he stated. However, the specific projects that will benefit from these reallocated funds were not disclosed.

The President explained the decision to relocate the port to Thilafushi during the announcement of the third development phase at Velana International Airport. He cited the unsuitability of Gulhifalhu for a commercial port and expressed optimism about the economic prospects of the Thilafushi location, linking it to the ongoing airport development.

The Maldives Industrial Development Free Zone Company, a consortium of five major government-owned companies, has been set up to oversee the development of the commercial port in Thilafushi. The shareholders include STO, HDC, MPL, MTCC, and MACL, and the government has allocated 100 hectares of land in the Male area to facilitate the company’s activities.

Questions arise regarding the availability of funds for the Thilafushi port project, especially considering the significant investment already made in dredging activities at Gulhifalhu. The second phase of the dredging project alone was projected to cost MVR 2 billion. Despite the relocation decision, it is unclear whether the necessary funds have been secured for the Thilafushi project. The project was notably promoted to investors during President Muizzu’s visit to China.

With the shift away from Gulhifalhu, where the project had reached the tender stage and dredging work was ongoing, the government’s strategic redirection marks a significant change in its infrastructure development plans. This move reflects the dynamic nature of national development strategies and the government’s commitment to adapting its plans to best serve the interests of the Maldivian people and economy.

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