The government has announced a series of concessions aimed at attracting investors to expand tourism in underserved areas.
In a press release, the Ministry of Tourism and Environment said relevant policies have now been changed such that the lease acquisition rates for islands in these areas are reduced, as well as the location premium for islands and lagoons in these areas.
President Dr Mohamed Muizzu has reaffirmed his administration’s commitment to expanding tourism through resort development across underserved atolls. As outlined in his Manifesto and reiterated in his Presidential Address in February, the President recently announced that the Government will prioritise unlocking tourism potential in Haa Alifu, Haa Dhaalu, Shaviyani, Thaa, Laamu, and Addu City. This initiative will be pursued through a multi-pronged approach, consisting of targeted concessions, incentives, investments in public infrastructure, and focused marketing efforts, with the objective of mobilising investment and catalysing regional economic activity.
According to the Tourism Ministry’s press release, the lease acquisition rates per hectare rates for islands, land or lagoons leased under policies related to open bidding and cross subsidies for tourism purposes have been reduced. Furthermore, the government has decided to reduce the location premium for islands leased from Thaa Atoll under closed bidding policies.
Under the same rule, the location premium for lagoons in Haa Alifu, Haa Dhaalu, Shaviyani, and Thaa Atolls as well as Addu City will be waived. Additionally, the location premium for lagoons in Laamu Atoll will be reduced from USD 150,000 to USD 100,000. The location premiums for Haa Alifu, Haa Dhaalu, Shaviyani, Thaa, and Laamu Atoll lagoons have also been reduced by thirty percent.
Furthermore, the premiums on islands sized between 20 to 40 hectares in Haa Alifu, Haa Dhaalu, Shaviyani, Thaa, Laamu Atolls and Addu City have been removed. The premium for islands larger than 40 hectares in these six atolls have been reduced from USD 2,000,000 to USD 1,000,000.
The government has also decided to defer the land rent payments for the remainder of the grace period if the property is developed and opened before the expiry of the grace period.
In addition, the duty exemption percentage for rental properties in these areas has been increased to 15 percent, with the list of duty exempted categories updated to include furniture, kitchen appliances, equipment, electronics and amenities. The government has also decided to facilitate flexible payment options for islands and lagoons subject to open bidding such that it can be paid in instalments.
The Ministry of Tourism said 31 projects will be launched in the underserved areas to further develop tourism. These concessions are expected to boost tourism, create jobs and business opportunities and increase income in these regions.