The Maldives has denied reports of discussions with Sri Lanka to establish a free economic and movement zone, following claims by Sri Lankan media of a potentially transformative agreement between the two countries.
Sri Lankan media outlet Lanka-e-News reported on Wednesday that Colombo and Malé were in early talks over an arrangement that could allow citizens of both countries to live, work, study, own property and access public services in each other’s territory without visas or work permits.
However, Minister of Economic Development and Trade Mohamed Saeed on Friday dismissed the claims, posting on X: “Talks that the government is trying to establish a commercial duty free zone between the Maldives and Sri Lanka are untrue. It has not been thought of or discussed yet.”
According to the original report, officials had discussed the framework for a bilateral free economic zone and a customs union, which could eliminate duties on goods traded between the countries and significantly ease the cross-border movement of people and capital.
The initiative was said to mirror elements of the European Economic Area, with joint mechanisms proposed to oversee labour mobility, tax harmonisation, financial access and student exchange programmes.
The report has drawn interest among stakeholders and economists in both capitals, but also raised concerns over labour migration and regulatory alignment. Some experts have warned of the risk of being economically overshadowed by Sri Lanka, which has a population over 40 times larger.