Thilafushi Port Development Project Set to Transform Maldives' Maritime Industry by 2026

For decades, Maldives Ports Limited (MPL) has served as the backbone of the country’s maritime trade, managing the gateway through which the vast majority of imports enter the nation. Given the Maldives’ heavy reliance on imported goods, Malé Commercial Harbor has played a critical role in sustaining the economy. However, over time, the port’s aging infrastructure, limited space, and mounting logistical demands have presented significant challenges.

As the nation’s trade volume continues to grow, it has become increasingly clear that the current facilities in Malé are no longer sufficient to meet the needs of a rapidly developing economy. Recognizing this, MPL has made a strategic decision to expand its operations and relocate to a new port in Thilafushi. This relocation aims to resolve long-standing space limitations and modernize the country’s port infrastructure, setting the stage for a more efficient and future-ready maritime hub.

Thilafushi Port Development Project is poised to revolutionize logistics operations in the Maldives and become a key driver of economic growth by 2026. The Thilafushi Development Project is a large-scale, long-term initiative planned in multiple phases to transform the island's infrastructure and logistics capabilities. The Project is planned to be carried out in two phases.  Phase 1 of the project focuses on the construction of the International Logistics Terminal (ILT), which is expected to be completed by mid-2025. Once finished, the relocation of all empty containers currently stored at Malé Commercial Harbour (MCH) and Hulhumalé International Terminal (HIT) will begin, marking a major step forward in streamlining the country’s port operations.

Phase one includes the work required to transfer some of the operations of Malé commercial harbor to Thilafushi. The total cost of the project is estimated at 255 million US dollars, with the first phase expected to cost 35 million US dollars.  To support this initiative, the government has allocated 60 hectares of land in Thilafushi to Maldives Ports Limited.

First Phase of Thilafushi Port Development Project:

The first phase of the Thilafushi Port Development Project is progressing steadily, with the construction of a 70-meter quay wall currently underway. This infrastructure, being built by the Maldives Transport and Contracting Company (MTCC), is expected to be completed by the end of May and prepared for operational use soon after. The Thilafushi International Logistics Terminal (ILT) project, also awarded to MTCC, is divided into two sub-phases—Phase 1 is being implemented by MTCC, while Phase 2 will be executed using in-house resources.

Phase 2 includes vital infrastructure works such as electrical installations, the setup of a welfare center, and the creation of a designated area for empty container storage. As part of this initial phase, empty containers from Malé and Hulhumalé will be relocated to Thilafushi to alleviate space limitations at existing ports. The key goal of Phase 1 is to maintain uninterrupted cargo handling services while enhancing the overall efficiency of port operations.

We’re currently working on setting up an empty container depot in partnership with MTCC. In addition to that, we have assigned MTCC to develop an integrated logistics terminal and a bulk terminal, which will feature a 70-meter quay wall as part of the construction. With the relocation of some container terminal operations to the new port, we expect a noticeable reduction in the congestion at the Malé Commercial Harbor area. said Mr. Mohamed Ameez, Chief Strategy Officer of MPL.

At the moment, the Malé Port is managing both loaded and empty containers. Once cargo is unloaded at the Malé Commercial Harbor, the empty containers often remain there until they can be shipped out. We plan to implement a system to store the empty containers at Thilafushi Port. This move should ease the space constraints in Malé Commercial harbour area and help speed up cargo clearance operations” explained Hussain Naeem, Chief Technical Officer of MPL

Since its inception in 1985, the Malé Commercial Port has faced ongoing challenges in meeting the demands of modern maritime operations. The existing quay wall lacks the structural capacity to support shore-based or mobile harbor cranes, forcing cargo to be unloaded using the vessel's own onboard cranes. This is a very slow and equally breakdown-prone crane, so containers are unloaded from ships very slowly. On average the port turnaround time for a vessel is approximately 7 days for full discharge operations, and for each day a ship must stay at the port, there is an operational expense charge of approximately $24,000. Due to the delay of ships at the port, freight costs have increased, leading to higher prices of general goods. 

With the completion of the first phase, mobile harbor cranes will be used for unloading cargo at Thilafushi Port. This will be the first port in the Maldives to offer such a service. As a result, the average port turnaround time for a vessel will be reduced from 7 days to 2 days. It is expected that this will lead to a reduction in freight charges, potentially allowing businesses to offer more competitive prices for goods. Of the containers unloaded at the port, 50% of the cargo are transferred via Dhoni and other vessels to the atolls, and this service will be provided from Thilafushi Port in the future. Additionally, extra space for bonded warehouses and storage will be available for rent to businesses.

Second Phase of Thilafushi Port Development Project: 

The main objective of the second phase is to develop a modern container terminal and establish a modern facility for clearing goods. The second phase includes a 375-meter international berth, a container freight station, and a 2.3-kilometer domestic quay wall. Along with this, the current container capacity of 3,000 in Malé and Hulhumalé will be increased to 10,000. This is the estimated increase in port demand for the next 10 years. As the port is the main gateway for importing goods into the Maldives, any improvement to the port will positively impact the Maldivian economy. Faster port operations, reduced logistics costs, and accelerated progress of other projects in the Maldives will indirectly contribute to GDP growth.