The first ten islands under the Government’s plans to release 35 new islands for tourist resort development has been announced today. This was announced by the Minister of Tourism and Civil Aviation Dr. Mahmood Shaugee at a ceremony held at Nasandhura Palace Hotel in Malé. During his speech, Dr. Shaugee highlighted the potential for development of more tourist beds in the country. “â€¦and with the increase in the world tourism and the popularity Maldives is gaining in the generating markets, we have to keep pace with increasing demand to keep our market share in the industry” Dr. Shaugee said.
The new 35 islands consist of 20 islands to be placed on bid and 15 islands to be awarded to a proposed public company for tourism development.
This first round includes two types of bids: lease-Rent Controlled Bids and lease-Rent Open Bids.
Lease-Rent Controlled Bids:
In this type of bids, the highest rent that can be proposed per bed per year is fixed. This is meant to facilitate medium-priced resorts to enter the market over the next one to two years. Controlling the lease-rent at a reasonable level, is meant to help lighten the burden of raising investment finance and ensure smooth completion of the project. The total lease period is 25 years and the rent after the tenth year will be determined based on the prevailing average lease rent rate in the Maldives tourism sector at that time.
Lease-Rent Open Bids:
In this type of bids, the islands will be awarded to the bidder who proposes the highest rent for the first 10-year period. This bid is targeted at islands with smaller bed-capacity and is meant to provide the opportunity for bidders who may want to win a price competitive bid and develop innovative and luxury products. The total lease period is of the islands is 25 years and the rent after the tenth year will be determined based on the prevailing average lease rent rate in the Maldives tourism sector.
The bidding of these islands is based on the need to meet current and projected bed-capacity needs in the Maldives. The total bed-capacity of the 35 new islands, together with the islands awarded for resort development in 2005, is expected to add 7000 new beds over the next five years.
Source: Maldives Tourism Promotion Board