US to Reasess the Maldives for Preferential Trade Partner
Maldives to be Reassessed for Preferential Trade
US Seceratary of State, Hillary Clinton received a letter from Foreign Minister Dr. Ahmed Shaheed requesting that the Maldives be reassessed for inclusion in the preferential trade scheme. The Maldives has been suspended by the US from eligibility since 1995 because of the country’s human rights record including the lack of labour rights. The pair have established communication where they discussed deeper economic and development ties between their respective countries.
The General System of Preferences (GSP) programme aims to promote economic growth in the developing world by giving privileged duty-free entry to 4,800 products from 131 designated countries.
Since its suspension, the Maldives has gone through a series of democratic transformations including the ratification of an Employment Act, the ratification of a Constitution preserving a bill of rights and the first multi-party presidential election.
Ahmed Naseem, State Minister for Foreign Affairs, said that they have done everything that is necessary. Everything is back on track. He says that all the country’s human rights issues have been solved and the Maldives now has a democratic and transparent government. They are very hopeful that they will get reinstated. The said changes have also raised the possibility for bilateral trade and investment, and the qualification of the country for its reassessment to the GSP scheme. The move was encouraged by Clinton in her letter. She welcomed the recent political developments in the Maldives and told more about the ways in which the two countries could cooperate in trade, investment and development assistance. The foreign ministry responded by presenting several procedures which can help achieve these goals.
The reinstatement of the Maldives would open up the US Market to its exports and allow the two countries to reach an Overseas Private Investment Corporation agreement where US companies would gain access to preferential financing to invest in the Maldives.
According to Naseem, exporting fish to the US could be a huge advantage for the Maldives. Fish exports currently account for 10 per cent of the country’s Gross Domestic Product. “The most important thing, however, is that US investors will look at the Maldives from a different perspective,” he said.
In addition, the Maldives could be qualified for US development assistance from Millennium Challenge Corporation (MCC), a corporation which aims to strengthen good governance and economic freedom. Their mission is to lessen global poverty through sustainable economic growth. A country would be eligible if it exercises civil liberties, political rights, rule of law and corruption control.
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