Maldives Eyes Economic Boost with Chinese FTA and Banking Collaboration

The Maldives is working to establish a Chinese bank and implement its Free Trade Agreement (FTA) with China starting in September. This move, announced by Minister Mohamed Saeed, aims to facilitate local currency trade, enhance business opportunities, and improve bilateral relations despite regional tensions.

The Maldives has initiated steps to set up a Chinese bank in the country, with the implementation of the Free Trade Agreement (FTA) between the island nation and China set to begin in September, according to an announcement on Tuesday.

Maldives' Minister of Economic Development and Trade, Mohamed Saeed, made the announcement at the 'Maldives-Sichuan Trade and Investment Cooperation Conference,' highlighting the economic opportunities that the FTA would bring.

"Work has begun to establish a Chinese bank in the Maldives. The free trade agreement between the Maldives and China, set to commence in September, would offer numerous benefits, including allowing businesses to conduct transactions in their respective currencies," Saeed said.

This local currency settlement between the Maldivian Rufiyaa and the Chinese Yuan will enable Maldivian businesses to import goods from China using local currency instead of USD, thereby boosting trade and import efficiency.

(With inputs from agencies.)