Minister of Economic Development and Trade, Mohamed Saeed, has refuted any connection between the reduction in import duty revenue and the Free Trade Agreement (FTA) with China.
The China-Maldives FTA, which took effect on January 1, was anticipated to significantly benefit various sectors by improving access to materials and tools, thereby alleviating challenges faced by local businesses.
However, just over a month after the FTA’s implementation, recent revenue reports indicate a notable decline in import duty revenue, which some have associated with the FTA.
During the fourth forum of the ‘Ahaa’ series, where the government addresses citizens’ inquiries, Minister Saeed clarified that the revenue drop is unrelated to the FTA. “We have imported goods valued at MVR1 billion [USD64.9 million] since January. Its CIF value is MVR34 million [USD2.2 million].
Of that, FTA relief was MVR2.3 million [USD149,157], which is merely 1 percent of total imports. Thus, [the decline in import duty revenue] is not connected to the FTA,” he stated. Regarding the advantages of the FTA, Minister Saeed noted that the Maldives and larger nations may have differing perspectives on the creation and execution of such agreements.
He emphasized that since the Maldives relies heavily on imports, the population stands to gain the most from these arrangements.
“Maldives is an import-dependent country. Local entrepreneurs will benefit from importing goods more affordably. The general public or consumers will also gain. We aim to avoid imposing high tariff rates and bands,” the Minister remarked.
Minister Saeed further stated that simplifying business operations and keeping commodity prices stable is a key goal of the current President, Dr. Mohamed Muizzu, and that efforts are underway through the Maldives Industrial Development Freezone (MIDF).
