Maldives, IsDB ink pact to set up MVR 616m fund for SMEs
According to the ministry, the fund will diversify its investments across different sectors, by geography and business stage.
Maldives has signed a Memorandum of Understanding (MoU) with Islamic Development Bank (IsDB) to establish a fund of MVR 616 million to support Small and Medium Enterprises (SMEs) in the Maldives.
In a statement, the finance ministry said on Monday that finance minister Ibrahim Ameer and IsDB president Dr Muhammad Al Jasser signed the MoU at a ceremony held at the sidelines of the 2023 IsDB Annual Meetings in Jeddah.
The finance ministry said the fund will be a collaboration between the IsDB, Maldives Fund Management Corporation (MFMC) and SME Development Finance Corporation (SDFC) and will take the form of a collective investment vehicle that allows investors to pool their money and invest the pooled funds.
The fund is expected to be established with an initial capital injection of $40 million raised through IsDB, with the long-term objective of sustainably growing the fund through investment returns, the ministry said.
According to the ministry, the fund will diversify its investments across different sectors, by geography and business stage, and by investing through a range of different financial instruments.
It will target different areas of investment including the development of Halal tourism guesthouses in the islands, investments in infrastructure such as office spaces, light-manufacturing factories and storage warehouses, injection of funds to SDFC for more lending to SMEs.
"The IsDB and government of Maldives will work towards completing the necessary due diligence procedures and operationalising the SME Impact Fund in the coming few months," the statement read.
