Male, December 5: Maldives and China shook their hands not only physically but economically too as Maldives has decided to sign Free Trade Agreement (FTA) when President of Maldives Abdullah Yameen officially visited China. So the question arises that how much FTA beneficial for Maldives and neighboring countries especially India?
The FTA with China is likely to further boost economic ties and bring tangible benefits to Maldivian importers and exporters. The FTA is the natural result of the economic complementarities of China and the Maldives. The FTA is expected to exempt over 95 percent of bilateral trade flows from tariffs while enhancing cooperation in areas including finance, medicine, tourism, and fishing.
Minister of Economic Development Mohamed Saeed and Minister of Foreign Affairs Dr. Mohamed Asim, Minister Saeed stated that the China-Maldives Free Trade Agreement Negotiation was initiated in 2014. Minister Saeed stated that the ongoing talks to establish a free trade pact will enable exemption of duties on fisheries products exported to the world's largest consumer market; adding that the Administration strives for a greater international trade policy.
The Maldives transitioned from Least Developed Country (LDC) to Middle-Income Country status on 1st January 2011. However, this growth was accompanied with huge duties levied on fish products exported to the international market.
The Maldivian government has extended invitations to establish free trade agreements with countries including Japan, the United States of America, the United Kingdom and countries of the European Union, Saeed added.
This FTA put a question on Indo-Maldives relations which was later cleared that the FTA would not affect the relations of Maldives with its neighboring countries. Maldivian Ambassador Mohamed Hussain Shareef clarified that the FTA with China was “purely commercial.” “When it comes to security in the Indian Ocean Region, it is between the Maldives, India and Sri Lanka. No one else is welcome, be it friends from the East or West,” he said.
FTA has also disturbed the internal situations as Maldives Trade Union has opposed FTA by stating “China-Maldives free trade agreement is a disastrous for Maldives trade sector, as that allows Chinese to enter the Maldives retail market and import and distribution sector freely, which is a revival of Indian "Voraa" traders influence in local trade in 1970's.” “China-Maldives trade agreement must be treated as "void",as this agreement violates the integrity of our nation.”