The tiny nation of the Maldives plans to diversify its hard-pressed economy and prop itself up with a $9 billion new hub of blockchain and digital assets in the capital, Malé. The Maldives International Financial Centre, a project the ambitious one for the Maldivian government and MBS Global Investments which is a Dubai based family office run by Sheikh Nayef bin Eid Al Thani is a merely a collaborative.
The proposed financial center would span over 830,000 square meters with maximum of 6,500 residents and potentially 16,000 jobs. According to the development, the five year project will cost nearly $1 billion and will produce more than $1 billion in yearly revenue at its fifth year. It should be noted that it’s an investment well beyond Maldives annual GDP which currently stands around $7 billion.
With repayment for around $600–$700m this year and $1bn in 2026, the Maldives is facing substantial external debt obligations and the new initiative follows this time. The reason the government thinks this blockchain hub is a good idea is to respond to these financial challenges and to take in foreign direct investment, especially in blockchain and Web3 technologies, the burgeoning areas.
The project is to be financed by MBS Global Investments, through a combination of equity and debt and has already raised commitments in the range $4–5 billion. In order to help develop the venture, the firm is hoping to rely on its network of family offices and high-net-worth individuals to create a consortium.
The Maldives is politically stable, geographically located strategically close and near major markets such as India and the Gulf countries yet there are challenges to become a regional financial hub. With so many countries endeavoring to become the next Bitcoin capital, the nation will have to compete with strong established leaders like Dubai, Singapore, and Hong Kong, that have secured their feet already as leaders in the crypto and fintech sector.
However, the government of the Maldives is optimistic that the partnership arrangement with MBS Global Investments represents a new model for cooperation in business operations, away from the normal process of borrowing. MOUSA Zameer, Finance Minister said that the entry into this field signifies a stepping stone toward economic diversification and long term financial sustainability of the country.
