Maldives investment incentives

Considered one of the most attractive tourist destinations in the world, the Maldives will undoubtedly become an interesting country for foreign investors. Foreign direct investment has played a vital role in the economic growth of a country over the years. The government of the Maldives understands the great importance of foreign investment for the economic development of the island state and strongly supports it in its policies.

The Maldives' vibrant private sector, liberal trade environment and development-friendly legal framework contribute to an overall favorable climate for investment and trade. Foreign investors benefit from an uncomplicated policy structure in which foreign investment law guarantees the security of both foreign and domestic investments. Thanks to such positive policies, many world famous companies have decided to invest in the Maldives. 

The Maldives is a member of the South Asian Association for Regional Cooperation (SAARC) and a participant in the South Asian Free Trade Area (SAFTA).

Investment encouragement

The Maldives is keen to attract foreign investment, especially capital-intensive investment that transfers technology, creates new skills and preserves the environment.

Foreign investors of all categories are encouraged to settle and conduct business within the country. For relatively small investors, the government recommends setting up joint ventures with Maldivian citizens or companies registered in the Maldives. Investors who provide an investment of more than US$5 million will be free from ownership restrictions and will be able to operate as wholly owned properties if they so choose.

Incentives for investment

In the Maldives, you can take advantage of a variety of investment incentives. You will have the right to full foreign ownership and will have an investment guarantee backed by law. There will also be provisions for arbitration of disputes abroad. You can also enter into long-term contracts and take advantage of long-term land leases. Investors will have the freedom to hire foreign technical, unskilled and managerial personnel. There will be no restrictions on the exchange of foreign currency or the repatriation of income and profits.

In September 2014, the Maldives passed the SEZ Special Economic Zones Act (Law No. 24/2014) to encourage private investment in large-scale projects in priority areas such as:

• export processing activities
• transportation and transshipment
• universities, hospitals and research centers
• information, communication and technology parks
• international financial services
• oil and gas exploration
• initiatives that introduce new technologies

Investments in SEZs exceeding US$150 million are eligible for special tax and regulatory benefits guaranteed by the SEZ law. The list of priority sectors is reviewed annually by the President.

Incentives under the SEZ law include:

• Exemption from corporate income tax
• Exemption from goods and services tax
• Exemption from income tax
• Flexible procedures for employment abroad
• Tax exemption for the purchase and sale of land
• Possibility of acquiring land ownership by companies registered in the Maldives with a local share of at least 50%

The duration of these tax breaks depends on the field of activity and the scale of investment.

The benefits of investing in the country also include:

1. Unified business registration service through Invest Maldives.
2. Public-private partnership program.
3. Investment programs for foreign portfolio investors.
4. No restrictions on repatriation of profits and capital gains.
5. Exemption from customs duties for large-scale projects.
6. Easy entry by obtaining a business visa or corporate resident visa.
7. Freedom to use foreign managerial, technical and unskilled workers.
8. Use international arbitration to resolve disputes.
9. No currency restrictions.
10. Long-term land lease for up to 99 years.

Visa requirements and entry permits

Those considering investing in the Maldives can visit the country on a free 30-day tourist visa and conduct research or other work related to investing in the destination. Once the government has approved your investment, all foreign employees hired must go through the normal work permit process.

Why invest?

The Maldives has continued to develop at a steady pace over the past twenty years. The economy remained resilient despite the turmoil the world experienced during this period. Pro-market policies embedded in the government's economic vision contribute to the creation of a strong, liberal and transparent trade and commercial environment. In its quest to build a strong and stable economy, the government has implemented a number of measures to open up attractive opportunities for foreign investors.

The Ministry of Economic Development checks and reviews all foreign investment proposals. This process includes standard due diligence measures, such as local police verification of all investors, determination of the financial status of prospective shareholders based on bank records, and background checks of involved investors. According to the government, each case is considered on its own merits, taking into account factors such as the number of existing investors in the sector and the potential for employment and technology transfer.