International: Maldives and China discussed avenues for strengthening defence cooperation between the two countries, the defence ministry said. In a post on X on Friday, the Maldives' Ministry of Defence said Defence Minister Ghassan Maumoon met his Chinese counterpart Admiral Dong Jun on the sidelines of the 11th Beijing Xiangshan Forum.

"During the meeting, the two ministers discussed avenues of strengthening defence cooperation between the two countries," it said, without disclosing the details of the discussions.

Maldives' Ambassador to China, Dr Fazeel Najeeb, was also present during the meeting, it said. The Maldives and China have previously held talks to strengthen military ties. In March, Maldives and China signed an agreement to provide military assistance to Maldives military and security services, according to a report in adhadhu.com news portal. Under the agreement, China will provide military equipment and training to Maldives, President Mohamed Muizzu had said. However, he did not provide details.

Maldives signs MoU with China to facilitate current account transactions in respective currencies

Later on Saturday, Maldives signed a Memorandum of Understanding with the People’s Bank of China to establish a framework for current account transactions and direct investments in their respective currencies and announced that it may soon have a branch of China’s biggest bank, ICBC.

China, which is Maldives' one of the largest trade partners with bilateral trade exceeding USD 700 million, and the top source of tourists to the Maldives, stands to benefit significantly from this agreement, state-run Public Service Media (PSMNews) said here on Friday.

The MoU between the Ministry of Economic Development and Trade of the Maldives and the People's Bank of China (PBOC) aims to facilitate smoother and more efficient trade and investment relations between the two countries by promoting the settlement of transactions in local currencies, PSMNews said.

“Work is underway to open a branch of China’s biggest bank, the Industrial and Commercial Bank of China (ICBC), in the Maldives,” news portal Sun.mv quoted Maldivian Economic Minister Mohamed Saeed as saying.

“Negotiations remain in progress,” Saeed added. The MoU follows the state visit of President Mohamed Muizzu to China in January 2024, where he met with President Xi Jinping to discuss strengthening the comprehensive strategic partnership between their countries and highlighted a mutual commitment to deepening economic cooperation, PSMNews said.

Maldives-China FTA 

The signing of this MoU represents a major milestone in bolstering economic ties and fostering increased trade and investment flows between the Maldives and China, it added. Maldives is also working out a Free Trade Agreement with China, formalities for which were complete, and would be “activated” at a time of mutual agreement, Saeed added.

The development comes ahead of President Mohammad Muizzu’s scheduled visit to India. Maldives is working out a similar Rupee-Rufiyaa arrangement with India. Maldives and India witnessed a downturn in bilateral ties since pro-China president Muizzu assumed office last November. On his insistence, India withdrew its military personnel manning three aviation platforms used for medical evacuation by May 10.

However, after External Affairs Minister S Jaishankar's visit here in August this year, the Maldivian foreign ministry had termed it as a "significant milestone" in bilateral ties and underscored that the two countries have expressed their desire to elevate their friendship and strong alliance to new heights.

Jaishankar's official visit to the Maldives was the first high-level trip from New Delhi after President Mohamed Muizzu, seen as a pro-China leader, assumed office in November last year.