Foreign Minister Abdulla Shahid on Sunday praised China-Maldives ties and backed the “mutually beneficial” partnership to grow under the present administration.
In an interview with Chinese state-run media Xinhua, Shahid called the relationship “an example of how one of the smallest members of the international community can have a mutually productive and progressive relationship with one of its biggest and most powerful members.”
The government hopes China will remain “an important economic and bilateral development partner for the Maldives, in its journey to become one of the most vibrant middle-income developing countries,” he added, expressing personal commitment to “ensuring that our already strong relations are further enhanced with more vigor and passion in the years to come.”
Shahid said the Maldivian people were “deeply appreciative” of key developmental projects financed by China such as the expansion of the international airport and the construction of a bridge to connect the capital with the airport island.
But the current administration came to power after criticising the mounting debt owed to China for financing the large-scale infrastructure projects under former president Abdulla Yameen and quickly moved to repair relations with India.
In the wake of Yameen’s heavy defeat in September’s polls, China welcomed the election of President Ibrahim Mohamed Solih even as its foreign ministry spokesman criticised former president Mohamed Nasheed’s repeated accusations of grabbing land and dragging the Maldives into a debt trap.
Earlier this month, Nasheed, currently the speaker of parliament, was at loggerheads with the Chinese ambassador over claims that the vast majority of the Maldives’ external debt was owed to China.
Citing statistics from the central bank, Ambassador Zhang Lizhong said the debt owed to China was US$1.5 billion out of a total debt of US$3.2 billion, far lower than figures stated by Nasheed.
The former president also criticised the price tag of the US$200 million Sinamalé bridge, alleging inflated costs and suggesting that it could have been built for US$77 million.
But Lizhong said the bulk of the cost was grant aid from China.
According to the central bank, the Chinese debt includes “guaranteed debt” of US$900 million. The previous administration provided sovereign guarantees for US$1.36 billion worth of loans taken by 23 state-owned enterprises and one private company, the new finance minister revealed in December.
In his Xinhua interview, Foreign Minister Shahid meanwhile went on to express support for China’s territorial integrity and the One-China Policy as well as the Belt and Road Initiative of infrastructure investment.
“The recent high-level participation by our economic minister at the Thematic Forum on Unimpeded Trade of the Second Belt and Road Forum for International Cooperation signifies the importance the government accords to the Belt and Road Initiative,” he said.
Shahid also observed that China was the largest source market for Maldives tourism and assured “continued efforts with stakeholders to ensure the safety and lawful interests and rights of Chinese tourists.”
MMA data shows the foreign debt is MVR 49.6 billion at the 1st Q of this year,equivalent to $ 3.21 billion. Total loans from China include $872 million concessional loans and $657 million preferential loans up to last Nov. it means $1.529 billion in total when projects complete. pic.twitter.com/h8JXZemEML
— Zhang Lizhong (@AmbassadorZhang) July 6, 2019
The cost of the Friendship Bridge is $ 200 million with 57.5% Chinese government GRANT, 36.1% preferential loan from Chinese bank and 6.4% from the Maldivian Gov.. In addition to grant, the Maldivian will only pay $ 100 million. Plus 5 yr GRACE and 20 yr payment duration. pic.twitter.com/oDHHGPK5TC
— Zhang Lizhong (@AmbassadorZhang) July 6, 2019
Maldives total foreign debt includes the active sovereign guaranteed debt and not just Govt to Govt loans. The extent of Maldives sovereign guarantees to Chinese banks are at potentially alarming levels. We must all be mindful for the future. @AmbassadorZhang
— Mohamed Nasheed (@MohamedNasheed) July 6, 2019
Thank you, Mr. Speaker.@MohamedNasheed What I cannot accept is continuous unverified and misleading info. to the public, which harms our friendly relations. it is vital to have rational diologue based on correct data. and It is a phonecall away to get full picture for any doubt. pic.twitter.com/ANWLO2JGbQ
— Zhang Lizhong (@AmbassadorZhang) July 7, 2019
Debt Sustainability is equally important to China . No partner is forced to borrow from China. Nor does China wish to see its partner in debt Problem. Projects or financing cooperation are all based on full consultation ,due risk assessment,  investment feasibility study. pic.twitter.com/QZLRkl3omy
— Zhang Lizhong (@AmbassadorZhang) July 7, 2019