Sun, Sand and Cement

The Maldives Development Story

There’s no stopping President Abdulla Yameen and his development agenda. The steps taken, however, have been a cause of concern for several stakeholders.

By Aishwarya Kumar


Diplomatic ties between Maldives and India are under immense strain. Maldives has been the beneficiary of some heavy investment by China and this has raised eyebrows back in New Delhi. Has the island nation become a pawn in a bigger geopolitical gambit between India and China?

News18 takes a closer look.

An archipelago of over 1,000 islands, Maldives has for long had a strategic role to play in the Asia-Pacific region with its proximity to sea routes via which most of the world’s oil is transported. Maldives, with its string of islands that rise barely 2 meters above sea level, has a population of around 400,000.

With financial backing from China, Saudi Arabia, Singapore and Thailand among other countries, many say that it’s transforming itself into the ‘Dubai of the Seas’. On the infrastructure radar is a 25-storey building, which will house the country’s first-ever medical school, a China-Maldives Friendship Bridge, the development of Hulhumale, a new island city that also was one of Yameen’s poll promises in 2013.

Abdulla Yameen declared emergency in February this year and went on to extend it till March 22. However, with or without the emergency, the island nation is at the cusp of massive infrastructure development, one which Yameen is said to be personally overseeing.

Maldives was at one point at front of anti-climate change campaigns. It is feared to be one of the first countries to go under water due to rising sea levels and climate change effects. The country, however, is now seeing lot of concrete and cement on land, which has been and is being reclaimed from its precious blue stretch.

THE DRAGON'S SHADOW

Maldives will secure $3.4 billion in investments in the next five years, Yameen said earlier this year. And indeed, the nation has secured millions in aid, already from various entities, including Saudi Arabia, Singapore, Thailand, European Union, World Bank, Asian Development Bank and China.

While the world might be coming together to be part of Maldives’ development story, it is China that this being closely watched. Maldives is an integral part of the Asian giant’s ambitious Belt and Road Initiative (BRI), which has come under critical lens around the world as much as it has been appreciated.

  • The China-Maldives Friendship bridge. (Photo: Aishwarya Kumar)
  • The development of the Velana International Airport in Maldives is being handled by Beijing Urban Construction Group (BUCG) and is expected to be completed later this year.

    BUCG, which replaced Indian infrastructure giant GMR on this project, is the same firm that built the architectural marvel Beijing National Stadium or the Bird’s Nest as it is known. The GMR project was a low-point for India-Maldives ties. The project was given to the Indian corporate giant under former president Mohamed Nasheed’s tenure, only to be abruptly scrapped by Yameen. Once complete, the airport is expected to receive 7.5 million visitors.

    Without giving out details, officials from the Maldivian government added that initially there were seven countries that were interested in the project, but only five gave their pricing. The procurement was done through the finance ministry. Maldives has also hired a consulting firm based in Singapore for consultations on the project.

    Interestingly, it is not just the company but majority of the workers, too, who are Chinese. Victor Wang, the construction manager at the airport site, said that out of the 400-odd workers on the site, around 160-180 of them are Chinese.

    “The only areas where Maldivians are employed are in administrative jobs. We have labour from Bangladesh and even Sri Lanka, but around 160-180 of them are from China,” Wang said.

    There are local agents in Maldives who help the firm with the hiring process. Wang has been in Maldives since April 2016. Work usually starts around 3-4 am, ends after a rigorous 12 hours and Wang added that work is well ahead of schedule. “We love Maldives,” he further said.

    Until 2011, China was not even a major player in Maldives’ foreign policy and vice-versa. However, three years later, in September 2014, Chinese President Xi Jinping visited the island nation and everything changed. It was the first state visit by a Chinese head since 1972 and Xi got Yameen on board BRI.

    A month later, in October 2014, the Export-Import Bank of China doled out close to $373 million to develop the Velana International Airport. The development includes a new runway, seaplane terminal, parking space for private jets, and cargo facility. The total amount being spent on it, as per Maldivian officials, stands at about $1billion.

    Construction going on in one of the islands. (Photo: Aishwarya Kumar)


    The rise in Chinese activity has been a cause of great concern for India. In fact, the Maldivian Ambassador to China Mohamed Faisal had said earlier this year that India was a brother, but China was a “long lost cousin”.

    The Maldivian Ambassador to India, however, has a different point of view and said that India did not react on time to the development project proposals. “India was offered participation in the development projects but some of our other developmental partners responded quicker, hence they got the projects. Time was of essence and we could not have waited,” Ahmed had said in an exclusive conversation with News18.

    The projects that were offered to India include the Hulhumale housing project and Velana Airport development among others.

    Last year, Yameen had declared that the development partnership between Maldives and China had reached a new high point and that the latter was Maldives’ “closest development and commercial partner”. The statement came as Maldives signed a Free Trade Agreement with China.

    We have labour from Bangladesh and even Sri Lanka, but around 160-180 of them are from China. - Victor Wang
    The new 25-storey building in Male, Dharumavantha Hospital, is also an example of Chinese footprint in the island nation. While the building is being built by Singapore-based Chang Hua, one could see a number of Chinese workers on site, with very little knowledge of English. A worker on the site that this reporter met briefly said he was a Chinese native who had come to Maldives for a better livelihood. The labour force at the site includes people from Bangladesh, Sri Lanka, China among other countries. There are about 30-40 Chinese people working on the site per day.

    The China-Maldives Friendship Bridge is, of course, a mark of the nations’ “forever friendship”, as Yameen put it. The Export-Import Bank of China issued a loan to the tune of $66 million to build the bridge that will start from Male and will end at Hulhule from where the ambitious six-lane highway will continue up to Hulhumale.

    The other big project in the island nation is that of Hulhumale. Around two decades ago, this used to be a reef, which has now disappeared and given way to a reclaimed island. Over 2 km in length, it is completely under the control of state-owned Housing Development Corporation (HDC) and is located 8 km off the north east coast of Male.

    Touted as the first smart and sustainable city in Maldives, Hulhumale was reclaimed with the aim of providing relief to the existing congestion in Male.

    What started off in 1997 now has about 40,000 people residing.

  • Work underway at the Velana International Airport. (Photo: Aishwarya Kumar)
  • While phase 1 of the island’s reclamation (of about 188 hectares) was completed in 2002, it was in 2004 that it welcomed its first settlement. In 2015, an additional 240 hectares (approximately) were reclaimed.

    As of now, heavy construction is going on for phase 2 of the reclamation. Chinese signboards can be seen at various places. The island will boast of malls, community centre, hospital, high-end villas and houses for lower income groups, knowledge park and a central park.

    Here too, the Chinese have a major role to play. In phase 2, China-based China Construction Third Engineering Bureau Co. Ltd is looking at constructing 7,000 affordable houses. The project includes high-rises.

    Additionally, under the FTA, Maldives waived off visa requirements for Chinese and also gave them a free hand in operating goods and services in Maldives all year through and vice-versa. In the area covered under phase 1, there are various Chinese boards that one can see; restaurants, water sports facilities, etc. A worker in one such Chinese restaurant said that there were many more boards and 3-4 other restaurants in the area.

    The possibility of a debt trap, considering the huge investment, is something that the Maldivian government does not worry about. The IMF has projected the Maldives’ external debt, presently 34.7%, will reach 51% of GDP by 2021.

    A major portion of this debt is held by the Chinese. Former president Nasheed has slammed the ruling government over its closeness to China and accused China of land grabbing. Earlier this year, economic development minister Mohamed Saeed said he was absolutely sure that there would be no debt trap that Maldives will fall into.

    Saeed’s colleagues in other ministries also seem to agree. Officials in the know-how of the Velana International Airport development project told News18 that their revenue model was strong and that the project was feasible in every way. The model included rent from the parking pace for private jets, a phenomenon which they say was not there earlier.

    “We have also had more airlines coming in last year which will further go up once we have the new airport. That will of course add to the revenue,” officials further said.

    As far as Maldivian government is concerned, the reclaimed land is a gold mine for them and for the country.

    ENVIRONMENTAL CONCERNS

    Yameen came to power in 2013 with an agenda of development and creation of jobs. While his development strategy seems to have kicked off and has also been successful to a certain extent, it doesn’t come without concerns.

    Maeed Mohamed Zahir from Maldives-based NGO EcoCare said that the burden of the development project was on the environment, something that was not the case before. He says that Maumoon Abdul Gayoom, who had been in power for 30 years, was the pioneer of environment conservation. His successor Mohamed Nasheed, too, did some legitimate work. Nasheed had famously held a cabinet meeting under water to bring forth the dangers of climate change.

    Yameen, however, has taken a step back in this regard. “Climate change and environment conservation do not seem to be priorities for this government,” Maeed said. He cites Kulhudhuffushi as an example.

    The government doesn’t realise how much damage it’s causing to the environment. - Maeed Mohamed Zahir
    “It’s an island of 12,000 people and the government is reclaiming the land which is full of mangroves for an airport. Now, there is an airport which is about 30 minutes from the island. Why does the government need to build another one?” asked Maeed.

    The government’s policy, he added, doesn’t go with the national understanding of conservation which is to continue to protect and nurture mangroves and marine life. The current government, Maeed told News18, plans to reclaim 10 new lagoons which means 10 new artificial islands will come up above the reef ecosystem.

    “The stress on the reef is already there because we had the El Nino in 2016 after which more than half of the reef was affected. The government is not going for sustainable methods and only wants to go in for hard infrastructure solutions for political gains,” he said.

  • One of the Chinese restaurants seen in Hulhumale. (Photo: Aishwarya Kumar)
  • The Yameen government does have a Climate Change Policy Framework with five goals, which include sustainable financing, low-emission development future, developing adaptation actions and building appropriate infrastructure, leading role in international negotiations, fostering sustainable development.

    However, the literature available with various ministries associated with the projects mentioned above, like the Hulhumale project, does not detail out how the project has affected reefs and if at all reclamation has impacted the marine life.

    While it does mention sustainable living and officials at the HDC also said that solar panels were being installed on the rooftops of buildings (work of which had started), there was still no word on the impact on marine life.

    The environment ministry, however, paints a pretty and sustainable picture.

    At a recent press conference in Male, environment and energy minister Thoriq Ibrahim said that the government was committed to conserving the environment and its precious marine life.

    Talking of coastal erosion, Ibrahim said that over the last four years, 30 km had been protected on several islands. “If that doesn’t happen, the islands will inundate and the infrastructure will be destroyed,” Ibrahim added. He further said that waste management facilities were being taken care of on each island, something that has never happened in the previous governments.

    Maeed, however, took to this with a pinch of salt. “It’s all for votes. The government doesn’t realise how much damage it’s causing to the environment. Along with development, they also talk of climate change but end up damaging the environment in the end. What is the point of this two-sided talk?” he retorted.