Day: August 12, 2012

President Waheed to attend OIC extraordinary session in Saudi Arabia

President Dr Mohamed Waheed Hassan has today embarked on a visit to Saudi Arabia at the invitation of King Abdulla Bin Abdul Azeez to attend the fourth extraordinary session of the Organisation of Islamic Cooperation (OIC) Conference.

According to the President’s Office, President Waheed has said a key part of the visit would be discussing the ongoing situation in Syria, while also establishing “close relations” with the Islamic community and discussing potential financial assistance from fellow delegates.

President’s Office spokesperson Abbas Adil Riza told Minivan News that while addressing Syria at the OIC emergency summit was the key focus of the visit, the president would also be talking with participants regarding different types of possible financial assistance for the country.

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Finance Ministry proposes drastic austerity measures to Parliament

Parliament’s Finance Committee last week received a proposal from the Finance Ministry which, if accepted, would save MVR2.2billion (US$143million).

The austerity measures include raising Tourism Goods and Services Tax (TGST) to 15 percent,  terminating electricity subsidies in Male’, increasing import duties on alcohol and imposing a 3 percent  duty on oil, “reforming” the Aasandha health insurance scheme, and reducing the budget of every Ministry and independent institution by 15 percent – among other measures.

If successfully carried out the Ministry’s proposals would halve this year’s budget deficit, currently projected to reach MVR9.1billion (US$590million).

The original budget for 2012 envisioned that revenue would rise to MVR11.4billion (US$740million) with expenditure anticipated to be MVR14.5 billion (US$941million). This would have resulted in a budget deficit of around MVR3billion (US$194million), representing 10 percent of GDP.

However, the revised figures provided by the Finance Ministry have shown that revenue will only be MVR8.4billion (US$545million) for this year with actual expenditure rising to around MVR18 billion. The ensuing deficit would represent around 28 percent of the nominal GDP for 2012, which was predicted to be MVR31.7billion (US$2billion).

This ballooning deficit has alerted the IMF which has expressed concerns that without raising revenue and cutting expenditures the country risked exhausting its international reserves and sparking an economic crisis.

The Maldives Monetary Authority’s (MMA) most recent statistics show that the country’s gross international reserves had decreased by 2 percent in the 11 months up to May before dropping by a further 6 percent between May and June this year.

The MMA’s data shows this figure to represents around ten weeks worth of imports in the Maldives, a country which relies heavily on imports, spending around two thirds of its real GDP on foreign goods each year.

The current government has pointed the finger at the previous administration for the current budgetary issues whilst simultaneously implementing a series of policies which have added to its financial obligations.

These deficit expanding policies have included promoting 1000 police officers,  doubling of the budget of the Maldives Marketing and Public Relations Corporation (MMPRC) to MVR69.3million (US$4.5 million), hiring of 110 new police officers, and a reinterpretation of the legal provision for the payment of resort island lease extensions which had cost the government MVR92.4million (US$6million) already in comparison with the same point last year.

The government also chose to reintroduce a MVR100 million (US$6.5 million) fishing subsidies and to reimburse MVR443.7 million (US$28.8 million) in civil servant salaries, reversing measures implemented during the previous government’s own austerity drive.

The raft of measures currently being considered by the Finance Committee represent the most comprehensive effort thus far to reign in the deficit.

Austerity Measures

The proposed measures for reducing state expenditure were published in local newspaper Haveeru. They include discontinuing electricity subsidies in Male’ City which, where around one third of the nation’s population live, saving MVR135million (US$8.7million).

Reducing the state’s offices budget by up to 15 percent is expected to save MVR1.5billion (US$97million) and was first suggested by Finance Minister Abdulla Jihad in May. Jihad mentioned at the time that a pay review board would be convened in order to “harmonise” the pay of government appointees.

The document received by Haveeru revealed details that this pay review body will seek to restructure pay schemes in order to save MVR100million (US$6.5 million). It also emerged that MVR300million (US$19.5million) could be saved by introducing a recruitment freeze in the civil service.

The austerity plan also includes a reform of the Aasandha national health care scheme, the cost of which promised surged ahead of its MVR720million (US$46.7million) budgeted allowance shortly after its introduction in January. After discussions with the government, the Aasandha company has decided to share the costs of private treatments with patients.

The Finance Ministry predicts that reform of the Aasandha scheme can save the government MVR200million (US$12.9million).

Revenue raising

Proposed revenue raising measures include raising the import duty on oil, upon which the country relies heavily for fuel, to three percent. MMA figures show that the price of crude oil has decreased 15 percent in the 12 months leading up to June whilst the domestic price had remained the same with the exception of diesel which increased in price by 2 percent.

Import duties are also to be raised on items whose value exceeds MVR6.4million (US$41million) as well as on liquor imports. The duty on both of these items had been raised as part of the amended Export Import Act in December of last year which saw duties on pork and alcohol products, used exclusively by the resorts, go up by 42 percent.

The tourist industry will be similarly hard-hit by the proposals to raise Tourism Goods and Services Tax (TGST) to 15 percent.  The IMF had previously urged the government to double the 6 percent tax levied on all goods and services sold in resorts with Tourism Minister Ahmed Adheeb announcing his intention in May to consult the tourism industry.

Minivan News discussed the potential increase with several resort managers at the time, and was told that an increase would have  “serious ramifications” for certain sections of the market. One manager said that the fixed term contracts many resorts have with operators meant that increases to T-GST would have to be absorbed from revenue, resulting in potential cutbacks to staff or services.

Visitors to the Maldives could also be affected by the proposed increase in the Airport Service Charge from US$18 (MVR277) to US$30 (MVR462).

Further rises to the tax levied on luxury items would be accompanied by the introduction of taxes to the sale of flats and on telecoms service in the Finance Ministry’s plan.

The visa fee paid by foreigners working in the Maldives is also slated to see be increased by MVR150 (US$10). Estimates of expatriate workers are be as high as 110,000 although the same estimates suppose that around half to be undocumented.

Despite the recent suspension of sittings of the full Majlis, the Finance Committee continues to hold meetings as normal.

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MNDF training island of Thanburudhoo to be developed as resort

Maldives National Defense Force (MNDF) has confirmed plans to develop a tourist resort on the island of Thanburudhoo, currently being used by the military for training and recreational purposes.

The confirmation comes just a week following the registration of the MNDF Welfare Company, created in a bid to generate income to fund welfare services for the armed forces by investing in various businesses, including the tourism sector.

Speaking to Minivan News on Sunday, Lieutenant Abdullah Ali explained that the MNDF is not going to play any direct role in the development of the resort, and that the island would be leased to a third party.

He claimed that the concept of developing the training island as a tourist resort was approved by the former government in 2010, but that work had stalled “for various reasons”.

“However, we have started that process again, and the discussions are continuing,” Lieutenant Ali said.

He also added that the MNDF Welfare Company is “going to be involved” in the project.

“MNDF Welfare Company is going to do tourism, real estate and other potentially lucrative businesses in the future. Our aim is to help reduce state expenditure by self-generating revenue to fund welfare services of the defense force.” Ali observed.

Former Tourism Minister Dr. Mariyam Zulfa confirmed to Minivan News that the Maldivian Democratic Party (MDP) government endorsed the Thanburudhoo project back in 2010, but said the President Mohamed Nasheed’s administration had never decided to involve the Defense Ministry or MNDF’ in the project.

“MDP believes in a center right system where the government has little or no control over the economy and promote privatisation. Defense Ministry or MNDF – whichever name u call it – it is still the government. So we would of course never support them to be involved in the project.” Zulfa observed.

She added: “As you know during Former President Maumoon Abdul Gayoom several uninhabited islands were given to various ministries. So the only reason Defense Ministry’s name appeared in the documents was because the island was registered under the ministry.”

Dr. Zulfa stated that the proposal was initially submitted by individual named Dr Gunnar Lee-Miller, who proposed to develop Thanburudhoo as a surfing resort. The nearby waters host beautiful dive sites and a popular surf-break, which attract many local and foreign surfers.

“We though it was a good proposal and supported it at the time, but the lease transfer was not signed,” Former Tourism Minister contended. “However, I don’t have any details of what happened with the project, following the MDP’s ousting from power on February 7.”

Minivan News contacted Gunnar Lee-Miller seeking to verify whether he was still negotiating with the authorities to secure the island, however Lee-Miller said that it was “not a good time” and hung up the phone. Further attempts to seek comment were met with no response.

Lee-Miller is identified as the President of Telos Investment, a private investment holding firm based in Singapore. The firm is leading the Five Islands project, which involves the development of three integrated resorts over five islands and nine square kilometres of lagoon in Gaafu Dhaalu Atoll. The project was contracted to the company under former government’s Corporate Social Responsibility(CRS) scheme, in return for establishing high-end sporting facilities in the country.

A speaker profile for Lee-Miller on the website of the Hotel Investment Conference Asia Pacific (HICAP) states that the developer “was recently appointed Senior Advisor to the Maldives National Sports Council assisting in all national sport and sport tourism development projects.”

Surfer controversy

Several local surfers have meanwhile raised concerns on social networks, claiming that the Thamburudhoo project involved dredging and reclaiming  the surrounding area of the island reef, which would destroy the popular surfing spot.

Banzai Bongo, a well-known local surfer, wrote on Facebook: “This is going to affect the natural current flow of the surrounding waves such as Jailbreaks, Honkies, Sultans and Pasta. Moreover, it will destroy dive spots around this area. So the government’s best interest is to annihilate our natural resources which includes world class surf sites and dive sites.”

Bongo called for surfers to “save these waves like we all stood against the state and saved the Trestles. Save it for or children, save it for the future.”

The Maldivian Surfing Association (MSA) said it would be issuing an official statement.

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Government presses terrorism charges against 21 MDP protesters over February 8 unrest

The Prosecutor General has pressed Terrorism charges against 21 Maldivian Democratic Party (MDP) protesters for damage to state property on February 8, for allegedly setting fire to the court and police station in Addu City.

Nationwide protests erupted on February 8 following the controversial transfer of power the previous day. Former President Mohamed Nasheed resigned amid a police and military mutiny, and later alleged this was under duress.

The protests were sparked after a brutal police crackdown on large numbers of demonstrators who attempted to enter Republic Square that afternoon, including the former President, MDP MPs and supporters.

Dramatic footage of the crackdown was filmed by international media outlets such as Al-Jazeera, while other footage shared on social media showed police kicking and beating protesters on the ground. Many of the injured were women.

A Minivan News reporter who was injured in a baton charge, at the time described the involvement of former President Maumoon Abdul Gayoom’s ‘Starforce’ officers: “They were beating old women with batons,” he said. “It was just like the old days.”

The protests spread across the country, with demonstrators targeting police and court buildings. Police officers were in some instances evicted from islands. The worst of the destruction occurred in Addu City, the country’s second most populated area after Male’, and an MDP stronghold.

A police crackdown followed in Addu, and was the subject of a report by international human rights organisation Amnesty International.

In one instance, security personnel “reportedly entered the MDP office in Hitadhoo, where more than a dozen women protesters had run for shelter. They chased the women into the storage room of the building and began to beat them,” Amnesty reported.

“Amnesty International learned that one woman had her arm twisted and sprained when MNDF soldiers grabbed her. They then took her glasses off, forced her to open her eye and sprayed it with pepper spray. She said they pressed her against the wall and kicked her with their boots.

“Another woman said that they began to beat her on her breast, repeatedly shouting they would see to it that she does not breast feed again. A third woman showed her badly bruised arm where she said that soldiers had severely and repeatedly beaten her.”

Amnesty noted that both sides had blamed each other for promoting violence, and that human rights in the Maldives “have become heavily politicised.”

In a statement today, the Criminal Court said the 21 protesters were accused of vandalising the Police Station at Addu, vandalising the Police School, the Addu City Court, and the Prosecutor General’s Office at Addu City on February 8.

The Criminal Court said that they were charged according to Anti-Terrorism Act article 2[f][g] and article 6[b].

On February 8, the [olice station on Milandhoo in Shaviyani Atoll and the station on Velidhoo in Noonu Atoll were reportedly taken over by MDP supporters.

In March, Police Sub-Inspector Ahmed Shiyam confirmed the arrest of 17 people on Thinadhoo in Gaafu Dhaalu Atoll, who were involved in vandalising property and creating unrest in the island on February 8.

‘’Those people are people whom we have pictures and video footage of their involvement in the incidents that day,’’ Shiyam said at the time.

In April, the President of the Police Integrity Commission (PIC) Shahindha Ismail told the Parliament’s Independent Institutions Oversight Committee that police actions on February 8 were unlawful, and that police officers had used undue force to disperse the Maldivian Democratic Party (MDP) demonstration.

In May police said they have concluded investigation into arson attacks against government offices and the police station on Thinadhoo in Gaafu Dhaalu Atoll on February 8, and sent the names of 108 persons to the Prosecutor General’s Office.

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Four Seasons launches local surf championship trophy

Local surfers will compete alongside six big international names during the Maldives Domestic Champions Trophy, to be hosted by the Four Seasons Kuda Huraa Resort from August 27 to September 2.

Last year’s title was won by veteran Australian surfer Mark ‘Occy’ Occhilupo, who will this year seek to defend his title from 1989 world champion Martin Potter, three times world champion Tom Curren, 2007 longboard world champion Phil Rajzman, two times world champion Damien Hardman and 2005 female world champion Chelsea Hedges.

The Maldivian Surfing Association (MSA) will meanwhile host a surfing competition to select local champions, who will then compete under the same world-class standards as the world champions with equal commentary, computer scoring and judging criteria.

The surfers will compete in four-man event heats to qualify for the final – a MVR 25,000 (US$1620) showdown for the title of Four Seasons Maldives Domestic Champions Trophy 2012.

Mark Winson, general manager of Tropicsurf – the event’s organiser – noted that “some of the best surfers in the lineup are locals, that’s for sure. Unlike other country’s surf scenes where the surfing community is very concentrated, here world class waves are scattered all across the country.”

“Some of the best surfers live a long way from Male’ and rarely get to see athletes like the six world champs featured this year. It will be great to see 20 of the country’s best surfers congregate at Thamburudhoo on the 27th for the MSA trials, eight of whom will surf in the Domestic Champions Trophy alongside the world champions.”

Tropicsurf’s Founder and Director, Ross Phillips, “was among the first to pioneer surfing in remote parts of the Maldives over 15 years ago with a dream of a locally driven sustainable surf movement in the country,” Winson noted.

“These days the MSA has grown and matured into a vibrant surfing association committed to developing the sport of surfing in the Maldives. We see the Domestic Champions Trophy as an opportunity not only for competition, but also to share some administrative components of event management with the MSA committee,” he said.

Intrepid surfers from around the world have become one of the core markets driving mid-market guest house tourism across the Maldives, and the country is becoming increasingly well known as an ‘undiscovered’ surfing destination – at least compared to famous beaches in places such as Hawaii, Indonesia, and Australia.

“The Maldives’ warm water, perfect waves and friendly people make it the ultimate destination for the travelling surfer,” observed Winson, asked to describe the country’s appeal.

“The Maldives is a surfer’s paradise, but a family paradise too. Non-surfers are catered to in every fashion imaginable and there is an accommodation option for everyone, ranging from luxury resorts such as Kuda Huraa to three star surf camps for the budget traveller. The waves are plentiful and varied to suit a wide range of abilities and craft. Here you’ll find your surfing nirvana!”

Winson added that the competition would showcase both the Maldives “and its world-class waves” – last year’s event was widely publicised in international surf media, due in large part to the participation of Occhilupo, Hardman, world longboard champion Josh Constable, four-time world champion Mark Richards, two-time world champion Nat Young, and seven-times female world champion Layne Beachley.

Occhilupo only narrowly defeated Beachley in the single fin division, after Beachley knocked out Hardman in the semi-final, and Occy defeated Constable.

Despite the camaraderie between the champions and the affable atmosphere aboard the nearby Four Seasons Explorer Catamaran, there was, Beachley told Minivan News, a very strong competitive undercurrent.

“When you’re surrounded by world champions there is a mutual respect because we know what it takes, but when we’re paddling out no one’s there to lose,” she said.

“It’s very competitive. No guy wants to lose to a girl. The boys are amped. Their pumped up, even if they’re pretending to play it down.”

The Four Seasons Maldives Domestic Champions Trophy will take place at Four Seasons Resort Kuda Huraa from August 27 to September 2, 2012, Four Seasons Maldives Domestic Champions Trophy will be held at Four Seasons Resort Kuda Huraa from August 27 to September 2, 2012, alongside the Four Seasons Maldives Surfing Champions Trophy.

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Vice president’s party talks solely focused on resuming Majlis: President’s Office

Talks scheduled this week between senior parliamentary representatives and Vice President Mohamed Waheed Deen will be focused solely on trying to find a resolution to the ongoing suspension of the Majlis, the President’s Office has said.

However, the opposition Maldivian Democratic Party (MDP)  today accused government representatives of giving “conflicting” messages after contending that an agreement had been made for discussions to also focus on facilitating early elections to resolve the deadlock surrounding the controversial transfer of power on February 7.

Government Spokesperson Abbas Adil Riza told Minivan News today that talks at the President’s Office scheduled for 11am on Tuesday August 14, were being held at the request of Parliamentary Speaker Abdulla Shahid following the suspension of the People’s Majlis late last month.

Abbas maintained that Tuesday’s talks would be focused solely on addressing parliament’s suspension rather than topics already agreed under the agenda of the all-party talks, which include issues such as early elections.

“This meeting is being held at request of the speaker as the various parties felt they needed to speak with the executive,” he claimed.

In a statement released today, the opposition MDP said the vice president had agreed to an offer to engage in dialogue to try and find what it called a way forward in the “current political crisis.”

“[President] Waheed’s government has assigned their Vice-President Mohamed Waheed Deen to participate in the talks agreed among leaders of political parties represented in parliament,” the statement read.

Speaker Shahid opted to suspend parliament “indefinitely” on July 31 after claiming that “an atmosphere of calm necessary to conduct sittings could not be assured” following confrontations between MPs in the Majlis chamber.  Several sittings had been cancelled owing to disorder in the lead-up to the suspension amidst reports of MDP MPs confronting the speaker.

On Thursday (August 9), the now opposition Maldivian Democratic Party said that a date to resume parliamentary sessions was “yet to emerge”, though claimed it was confident discussions were on the right track.

MDP spokesperson and MP Hamid Abdul Ghafoor today claimed that the severity of the speaker’s decision to suspend parliament last month had effectively seen the country come to a political standstill.

“The party made it very clear at the time in a statement that we would not be cooperating with the Majlis unless we were able to address our grievances,” he said.

Ghafoor added that Tuesday’s talks between key parliamentary figures and the vice president would be aimed at addressing the issue of hosting early elections before those presently scheduled by the Waheed administration for July 2013.

Responding to President’s Office claims that only the issue of parliament’s suspension would be focused on in the talks, Ghafoor alleged that the party was continuing to receive inconsistent responses from the government.

“Right from the start of this process we have seen the government giving us conflicting messages,” he said. “We have chosen to ignore these contradictions for practical purposes.”

As such, the MDP claimed that its representative at the talks – MP Ali Waheed – would look to discuss issues including facilitating early elections.

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