The Maldivian Construction Industry Association (MACI) has completed a significant report identifying the challenges of cargo transportation and maritime travel in the Maldives and outlining strategies to address them.

The logistics and transport industry of the Maldives is a multi-million-dollar industry. However, it is an industry that is predominantly controlled by foreign entities which has led to significant difficulties for local businesses. MACL has taken on the task of tackling these problems and released a comprehensive report looking into the issues at hand.

The ceremony held at Hotel Jen was attended by Minister of Economic Development Mohamed Saeed, MACI President Mohamed Ali Janah, and Abdullah Sawad, Chair of MACI’s Logistics and Transport Committee.

At the event, Minister Saeed stressed that this initiative was requested by MACI, under the presidentship of Dr. Mohamed Muizzu, for the purpose of tackling problems that Maldivian businesses run into. He said that a focused team from the Ministry of Economic Development has been working alongside MACI to achieve this aim.

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Saeed also stressed how committed the government is to work with the business community. He pointed out that it is a priority for the current administration to have an open and direct dialogue with business leaders. The minister said that, in the past 11 years, the Business Council had held 18 meetings; in just the last 17 months, it has had 5 consultations, a significant uptick in the rate of direct dialogue since, as Saeed put it, more meetings are better than fewer meetings. The main topics of conversation have been the many ongoing disastrous problems faced by the construction and transport industries.

The MACI president, Mohamed Ali Janah, praised Minister Saeed's involvement and said this collaboration was model example of how non-governmental organizations (NGOs) and the government can work together effectively. He acknowledged that the meetings were held under the guidance of the Economic Minister, who played a crucial role in bringing together relevant stakeholders through the Ministry.

Abdullah Sawad, the Chairman of the Logistics and Transport Committee, reemphasized the severe challenges faced in importing and supplying goods to the Maldives and many of which are attributed to weak regulations. He emphasized that resolving these issues require policy-level changes. Sawad highlighted the work of the committee in persisting to resolve some of the challenges faced by service providers, particularly those dealing with the Maldives Airports Company Limited (MACL), and to seek solutions together with the concerned parties.

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One of the issues that the report brings to the fore is that there is no adequate infrastructure in Hulhumale, which is one of the major business centers in the Maldives, to berth huge logistics vessels. Lack of sufficient trained captains and crew members within the industry has also been identified in the report. Various businesses have called upon MACI to push the government to establish adequate facilities to store these vessels.

Impact of Foreign Control on the Industry

The report also identified the foreign dominance of the local industry, which has had a negative impact on Maldivian businesses. Some of the key issues raised are:

•80% of the industry is controlled by foreign entities.

•There is illegal operation in cargo transportation, supply, and stevedoring by foreign companies.

•Most customs clearance activities are undertaken by foreign firms.

•Foreign companies are losing businesses by renting out boats, landing ships, and land motor vehicles.

•Foreign companies are carrying out construction material trade outside Thilafushi and Hulhumale.

•Some foreign companies are working illegally in project sites without proper permits and vessels purchased under short-term permits.

To answer the questions of the participants, Sawad emphasized that his primary aim is to restrict foreign investment in the industry and to offer more opportunities to Maldivians. He stated categorically, "While some would call for opening the sector up to foreign entities, I am very much against this course of action."

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Previous Reports and Government Support

MACL has previously released similar reports, like the one that addressed the impact of the COVID-19 pandemic on the construction industry. In response to the concerns raised in that report, the government prioritized supporting the sector, providing various forms of assistance to mitigate the negative effects.

This report, together with the ongoing support of the government, underscores the necessity to address the logistic and regulatory challenges in the Maldivian transport and construction industries, with the ultimate objective of strengthening the local firms and ensuring sustainable growth in these two critical sectors.