The Minister made these remarks in a response sent on the 15th of this month to a letter sent on the 29th of last month by Galolhu North MP Mohamed Ibrahim. The lawmaker had requested details on 20 key points to address public questions concerning the project. The Minister's responses were published on the MP's website today.
No agreement has been made for lease periods in Rasmalé to renew automatically according to Housing Minister, Dr. Abdulla Muthalib.
The Minister made these remarks in a response sent on the 15th of this month to a letter sent on the 29th of last month by Galolhu North MP Mohamed Ibrahim.
The lawmaker had requested details on 20 key points to address public questions concerning the project.
The Minister's responses were published on the MP's website today.
According to the Minister's response, the agreement with Eagle Hills was signed under the regulations for unsolicited proposals, pursuant to section 10.22(c) of the Public Finance Regulation.
He noted that only a commercial terms agreement has been signed thus far, and the final agreement regarding the 99-year lease period will be signed in accordance with the Constitution and laws.
The response also explicitly stated that no agreement has been made for the lease period of any property to renew automatically.
The Minister highlighted that 10% of the developer's total revenue must be paid to the state as land premium, which is estimated to be approximately $3.1 billion over 10 years.
While this amount is projected to increase as property prices rise in the market, the commercial terms stipulate that $500 million of this will be paid in advance for the housing project.
The response further noted that the state will receive taxes from economic activities conducted in Rasmalé, and unlike the tourism sector, import duties for this project will not be waived.
The Minister also stated that the state will bear no financial liability for the 5,000 housing unit project being carried out by the company in Hulhumalé.
The Minister also highlighted that special measures have been introduced to circulate foreign currency within the Maldives' economy.
Accordingly, payments to the developer's contractors must be made through a Maldives Monetary Authority (MMA) licensed local bank, and funds from buyers purchasing units off-plan must first be deposited into an escrow account opened at a local bank.
These funds will be released to the developer based on the project's progress, and secondary market transactions will also be conducted through a local bank.
Stating that provisions for project non-completion will be included in the main agreement, the Minister affirmed that no part of the project has been agreed to be sold or transferred as ownership to any foreign party, and all properties will be leased in accordance with Maldivian laws and regulations.
Dr. Muthalib stated that Rasmalé which is being reclaimed to provide housing for Maldivians will not hinder the government's housing policy. The project is estimated to create 54,000 jobs during construction and 15,000 permanent jobs upon completion.
The Minister also noted that Rasmalé is being managed in line with international best practices and that the project is not expected to affect foreign relations.
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