If the recently formed Opposition coalition in the Maldives is elected to power, there could be an enhanced role for Sri Lanka in the geo-political landscape of the Indian Ocean region.
In an exclusive interview with the Sunday Observer, former President of the Maldives and the leader of the Maldives Democratic Party (MDP), Mohamed Nasheed said that Sri Lanka must take a lead role within the Indian Ocean nations that also includes Seychelles, Mauritius, and the Maldives.
“Sri Lanka is by far the largest investor in the Maldives; if you discount Petroleum imports, we buy most of the goods from you and if you look at our exports, you are the third largest destination and can easily be the largest if we can set up a joint mechanism to process our fish,” Nasheed said.
Thailand and France are the largest export destination for the Maldives, with exports exclusively containing unprocessed fish.
“Right now we are selling all the fish at $ 700 a ton. If it is processed it is $ 2,500,” Nasheed said, indicating that the possibility of setting up a cannery in Sri Lanka to process fish and export from Sri Lanka had been explored while he was in power.
“Another option is to combine the two markets - more close collaboration with Sri Lanka would be beneficial for both countries,” Nasheed said.
The trade gap between Sri Lanka and Maldives is widening fast, in Sri Lanka´s favour. In 2005, the gap was approximately US$21 million. In 2015, the final year for which complete annual data is available, the gap stands at more than six times, at approximately US$122 million.
While Sri Lanka is the largest aggregate Foreign Direct
Investor in Maldives (FDI stock as a percentage of gross domestic product from Sri Lanka in 2015 was at 12.1% with China coming a close second at 11.1%). The increasing Chinese presence is worrying President Nasheed. “Investors must be able to own land as a factor of production. We are completely for it. However, when it comes to territorial interests and strategic infrastructure… we must think of safety and security of ourselves and also of our neighbours,” Nasheed said. Referring to a recently announced plan by the government of the Maldives to bring in infrastructure investments worth US$ ten billion, Nasheed said he believes this is a Chinese investment channelled through Saudi Arabia.
“There is a joint venture cooperation registered either in Singapore or London between Saudi Arabia and China to manage these properties in the Maldives. It is complicated and we have very few facts as the government has refused to be transparent. We hope to reverse this when we are in government,” Nasheed said.
The former President was critical of the decision by the current Maldivian government to unilaterally cancel a US $ 1 billion construction contract with Indian construction giant GMR to expand the Male airport. “It is very unfortunate that the government decided to terminate the contract with GMR.
The government paid $ 270 million now in compensation and therefore, our international reserves have depleted to about $ 25 million. If you do not consider the money swap arrangements with India and Sri Lanka our international reserves are very low now,” Nasheed said. The former President, said to be a committed environmentalist, indicated he wants to work with Sri Lanka to achieve carbon neutral status for Sri Lanka. “I really hope Sri Lanka would focus itself on becoming carbon neutral. We tried to achieve this while we were in government for Maldives and we got so much of foreign investments for these projects. However, unfortunately our government failed. These investors are still there and I am very sure that they will be very happy to invest in Sri Lanka,” Nasheed said. He indicated that a number of Sri Lankan leaders had assisted in bringing together the latest coalition. “I worked very hard specially within the last year, with a lot of assistance from a number of Sri Lankan leaders whom I don’t think I have the liberty to mention but they know who they are and I would always be thankful to them,” Nasheed said.