Maldives-China Free Trade Agreement to Take Effect in 2025

The Minister of Economic Development and Trade, Mohamed Saeed, announced that the Maldives-China Free Trade Agreement (FTA) will come into effect on 1 January 2025.

During a press briefing at the President’s Office, yesterday, Saeed emphasised the key benefits of the FTA, including the ability for both nations to conduct trade using their respective currencies. The agreement also allows local businesses to export products without facing export duties, while importers will benefit from zero tariffs on key commodities.

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“The duties we currently pay will drop to zero. This arrangement allows us to use our currencies for trade and access zero tariffs on 91% of Chinese imports, resulting in lower retail prices for these goods,” Saeed explained.

He further highlighted that the FTA enables the Maldives to export 296 items to China, including all fish products, without incurring tariffs.

“When we negotiated, a mechanism was established by the World Trade Organisation (WTO) to label seafood products, after value addition and retail pricing, as Maldivian. Upon compliance with this policy, these products will be recognised as Maldivian exports and can be sent to China duty-free,” Saeed added.

Additionally, the FTA permits Maldivian travel agencies to establish inbound and outbound operations in the free trade zones of Beijing, Shanghai, and Tianjin.

Saeed also mentioned ongoing trade discussions with other global partners, noting that negotiations with Turkey regarding a preferential trade agreement (PTA) have made significant progress. The Maldives-Turkey PTA is expected to be implemented by January 2025.

Currently, trade between the Maldives and China stands at USD 700 million annually, but the government projects that the implementation of the FTA will boost this figure to USD 1 billion.