The Maldives Fund Management Corporation (MFMC) signed a formal agreement with Atoll Works Private Limited on Wednesday for a comprehensive dredging, reclamation, and shore protection project involving 16 islands in the Gaafaru lagoon of Kaafu Atoll.

According to MFMC, 14 islands will be designated for private real estate development, while the remaining two will be used for luxury tourist resorts. The project also involves reclaiming an additional 40 hectares of land on Gaafaru island, expanding the total reclaimed area to 106.91 hectares.

This initiative marks the first simultaneous reclamation of multiple islands within the same lagoon in Kaafu Atoll. Valued at US$36.5 million, it includes US$29.2 million specifically allocated for dredging 3,747,792 cubic metres of sand at a competitive rate of US$7.80 per cubic metre.

The project will proceed under a contractor financing model, ensuring swift resource mobilisation and immediate commencement. MFMC will not make any upfront payment to the contractor, and construction will begin promptly. Repayment will be initiated after the islands are reclaimed and revenue is generated through long-term leases to private buyers.

The Maldives government entrusted Gaafaru lagoon to MFMC via a presidential decree as part of an integrated tourism development plan. The corporation has finalised a masterplan for the lagoon, with reclamation being the first phase of this initiative.