Legal issues delay dissolution of MITDC
Since its establishment in 2016, MITDC has received MVR 64.4 million from the state budget.
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The Finance Ministry has stated that the government's plan to dissolve the Maldives Integrated Tourism Development Corporation (MITDC) has been delayed due to legal issues related to the L. Baresdhoo project.
In a letter to the State-Owned Enterprises (SOE) Committee of Parliament, the Finance Ministry outlined key matters that need to be addressed before MITDC can be dissolved. These include resolving legal concerns related to the Baresdhoo project and determining the future management of the project. The ministry also stated that efforts are being made to minimise the impact on employees.
The Finance Ministry's letter highlighted that MITDC has not been operating in a manner that fulfils its intended objectives and that its dissolution aligns with the government’s expenditure reduction policy.
Overview of the Baresdhoo Project:
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The project aimed to develop an integrated tourism village with multiple tourism facilities.
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Jausa Construction was awarded a contract on 24 April 2017 for $22.8 million to build guesthouses, hotels, restaurants, and other facilities.
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MITDC paid Jausa an advance of $975,000 (MVR 15 million), but no work was carried out, and the funds were not returned.
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The company has outstanding payments of MVR 36.1 million from land leaseholders for the construction of tourism facilities in Baresdhoo.
The Cabinet decided on 1 September to dissolve MITDC as part of a corporate restructuring initiative aimed at reducing government expenditure, with plans to complete the process by the end of December.
Since its establishment in 2016, MITDC has received MVR 64.4 million from the state budget. The company has recorded losses amounting to MVR 164.2 million.
Following a discussion on the Finance Ministry’s letter, the SOE Committee decided to continue monitoring the matter until MITDC is dissolved. The committee also requested the Finance Ministry to provide full details on the dissolution process.
