DTIS, Volume I - Enhanced Integrated Framework (EIF)

on goods deemed luxury goods (e.g. cigarettes and perfumes). This was also discussed
with the Ministry of Finance representatives who indicated that such tariff reform was
under consideration.
Although there is currently very limited production activity in the Maldives, there is need
to be aware of anti-export bias in the tariff structure that may impact on other sectors,
such as tourism. Apparently, this problem is being addressed through the extensive use of
discretionary duty concessions and exemptions. The total value of these in 2004 was Rf.
413 million, compared to actual collections of Rf 1,136 m, representing approximately 36
per cent of total revenue. In previous years the proportion of concessions and exemptions
has been similar (37 per cent in 2001). In 2004 main beneficiary sectors were tourism and
fisheries.
No other duties or charges are levied on imports, although a fixed regressive rate bednight
tax of US$8 per bed night is levied on foreign tourists (as defined by the World
Tourism Organization).
As a participant in the SAPTA, the Maldives gives preferential tariffs on qualifying
imports from other SAARC countries. In January 2006, SAPTA is due to move into the
SAFTA with a programme to gradually remove all import duties on qualifying imports
from other SAARC countries.
Customs Services have not yet fully implemented their WTO commitments, including
the GATT definition of value, so minimum prices are still being used.
Although the economy is liberalized, there is wide-ranging state involvement in the
economy for social welfare reasons and to meet human development objectives. But this
may also create some trade distortion. State-owned enterprises (SOEs) engage actively in
trading activities. One of the main objectives for this is to ensure supplies of essential
foodstuffs. Import quotas, combined with price-control measures are maintained for
staple foods (mainly rice, sugar, and wheat flour). A small number of items (alcoholic
beverages, pork, used cars and motorcycles) are prohibited or restricted for religious,
safety, or environmental reasons.
No intellectual property legislation exists, but efforts are being made in this area. There is
particular interest in the protection of Maldives fish as a geographical indicator. The
WIPO undertook a technical mission in 2003 and made recommendations on establishing
an IPO office. Some progress has been made in implementing these recommendations,
but more work needs to be done in this field.
B. THE TRADE REGIME - EXPORT
The export regime is relatively open. Export controls (on timber), taxes (on ambergris),
and regulations are minimal, although some foreign investment royalties apply to exports
only (e.g. clothing). Royalties are charged on fish exports at 5 per cent CIF value and
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