Author: Ahmed Naish

Mahlouf’s resolution to postpone recess narrowly defeated

A resolution to delay parliament’s upcoming recess at the end of the month, until crucial bills to reform the criminal justice system could be passed, was narrowly defeated today.

Opposition Dhivehi Rayyithunge Party (DRP) MP Ahmed Mahlouf had proposed extending the ongoing session until belated bills on evidence law, criminal justice procedure and special measures to combat crime along with amendments to the gang crimes legislation and Children’s Act, could be enacted into law.

Of the 70 MPs in attendance, 34 voted against the resolution while 30 voted in favour and six abstained.

During yesterday’s debate, MPs of both the ruling Maldivian Democratic Party (MDP) and opposition parties argued that parliament’s perceived failure to pass necessary laws was not to blame for the shortcomings of the criminal justice system, particularly the authorities’ collective failure to secure convictions against “dangerous criminals” and enforce jail sentences.

Home Minister Hassan Afeef revealed on Monday that there were “about 300 people” sentenced in absentia that were yet to be taken to jail.

Closing the debate at the penultimate sitting of this year’s first session of parliament, Mahlouf argued that MPs should hasten to pass the legislation if only because “there will no longer be any person or institution that could point the finger at us and say ‘it’s because the People’s Majlis hasn’t completed [necessary laws].'”

Despite the 17th parliament having passed more legislation than any of its predecessors, Mahlouf urged MPs to “accept the reality” that the public did not believe parliament was doing enough.

“[They say] the number of days we work in the Majlis is low,” he said. “I accept this today. We take a holiday for four months of the year. We work about 12 days a month. For a year, it’s about 96 days. We don’t work for about 260 days of the year.”

The DRP MP for Galolhu South noted that none of the MPs opposed to postponing the recess had claimed there was no urgent need for the criminal justice legislation.

After voting on the resolution ended, Speaker Abdulla Shahid informed MPs that completed legislation on special measures to combat crime has been sent for their perusal.

The bill was amended in consultation with law enforcement authorities to include essential provisions from all three belated bills to serve as a stop-gap measure until parliament returned from recess.

Shahid explained that a proposal for a special sitting to be held during the recess in May would be put forward at tomorrow’s final sitting.

MDP MP “Reeko” Moosa Manik raised a point of order to suggest a sitting to be held tomorrow night to pass the crime legislation, but Shahid replied that a decision would be made after discussion with party leaders.

DRP squabbles

Mahouf – who has sided with “Zaeem DRP” against DRP Leader Ahmed Thasmeen Ali in the ongoing factional strife within the main opposition party – was attacked yesterday by MPs of the rival opposition faction for taking a holiday after submitting the resolution.

While DRP MP Abdulla Abdul Raheem accused Mahlouf of attempting “to pin a medal on himself and claim to be the best,” DRP MP for Mid-Henveiru Ali Azim claimed Mahlouf had taken the most leaves of absence during the past Majlis session.

Mahlouf hit back at Raheem today, claiming that he saw a form the Maafanu West MP had allegedly signed to defect to the MDP before changing his mind in 24 hours.

Moreover, he added, MPs Rozaina Adam and her husband Mohamed Nashiz were yet to return from an official trip to Panama despite MP Mariya Ahmed Didi, Speaker Shahid and Secretary General Ahmed Mohamed having arrived back in the country three days ago.

After attacking Thasmeen and Football Association Chairman Ali Azim for alleged poor attendance and lack of participation in important committee tasks, Mahlouf also exchanged heated words with DRP MP for Mathiveri Hussein Mohamed, who told him “to shut up and sit down.”

Hussein Mohamed argued that since Mahlouf’s resolution stated that a one month holiday should be granted once the “complex and technical” bills were passed, “what if we are only able to go to recess in November, how do we pass the state budget then?”

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GDP rebased to 2003 prices

The base period for measuring real Gross Domestic Product (GDP) or national productivity of the Maldives has been updated from 1995 to 2003, the Department of National Planning revealed this week.

Real GDP is an inflation-adjusted measure that reflects the value of goods and services produced within a country in a given year expressed in base-year prices.

“Changing the base period to a more recent year improves the accuracy of GDP estimates,” reads a press statement by the department. “Internationally, regularly changing the base period is encouraged. In most countries GDP is rebased once every five or ten years. Maldives’ GDP has been rebased after an eight year period.”

With the change in the base period, real GDP in 2011 is now calculated at Rf21,123 million while GDP per capita rises to Rf4,061, an increase of Rf1,217 from previous estimates.

“Among the reasons for the difference, apart from richer information used to calculate GDP, include changes to methodology,” the statement explains.

A “supply and use table” based on all transactions that occurred in 2003 was employed as a benchmark for rebasing GDP.

“In the rebased series extensive use was made of new available data, including annual accounts, government budget details, survey data, and price and unit value indices. The rebasing exercise took approximately three years to complete,” reads a report by the department.

Based on the 2003 series, it notes, real GDP on average grew 7.9 percent each year during the past decade, compared to 5.8 percent under the 1995 series.

Inflation

According to the last monthly economic review by the Maldives Monetary Authority (MMA), the pace of GDP growth in 2011 is projected at 4 percent.

Tourist arrivals registered a 15 percent increase in the first two months of 2011 compared to the same period last year while fish catch showed growth of 31 percent from 2010.

Increase in food prices meanwhile contributed to half of inflation in February 2011.

According to the planning department, the consumer price index (CPI) for Male’ last month rose by 5.6 percent compared to March 2010.

Compared to the previous year, the highest inflation was recorded for education with 23 percent – driven by a 42 percent increase in school fees – followed by fish products, which rose by 14 percent.

Food items such as coconut, green chili, watermelon, chicken sausage and oranges, showed a price increase between 25 percent to 70 percent.

However, the monthly inflation rate was low at 1.30 percent and showed deflation of 0.07 percent excluding fish.

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MPs clash over postponing recess

MPs clashed today over a resolution proposed by MP Ahmed Mahlouf to postpone parliament’s upcoming recess at the end of April to complete legislation currently at committee stage to reform the criminal justice system.

Several MPs from both main parties argued that convicts were not “roaming free and committing crimes with impunity” because of parliament’s failure to pass necessary laws.

MP Mahlouf – who has sided with the “Zaeem DRP” in the ongoing factional strife within the main opposition party – came under fire from his former Dhivehi Rayyithunge Party (DRP) colleagues for taking a holiday after submitting the resolution.

Last Wednesday’s sitting of parliament was cancelled reportedly because Mahlouf, who was supposed to present the resolution to the floor, was out of the country.

Defending himself from the intraparty criticism, the DRP MP for Galolhu South asserted that he had not been “sun tanning on the beach” but had faced a family emergency.

“I would deeply regret it if you vote against the resolution saying ‘Mahlouf took a holiday,’” he said.

In the ensuing debate however, DRP MPs Ali Azim and Abdulla Abdul Raheem accused Mahlouf of submitting the resolution “with the intention of deceiving the public.”

While Azim claimed that Mahlouf was “the MP that took the most number of holidays during the past session,” Abdulla Abdul Raheem accused the DRP Youth Wing President of ulterior motives behind the resolution.

Raheem alleged that Mahlouf’s true purpose in delaying the recess was “to conduct business transactions with certain people here.”

Shifting blame

Praising Mahlouf for “continually raising the issue of curbing gang violence” in parliament, ruling Maldivian Democratic Party (MDP) parliamentary group leader “Reeko” Moosa Manik however contended that the necessary bills “cannot be finished in one night with us cooking rice pudding and staying here overnight.”

Moosa concurred with other MPs that the absence of legislation could not be blamed for either unenforced sentences or dubious judgments by judges.

Following consultation with the National Crime Prevention Committee and law enforcement authorities, the Minority Leader explained that a sub-committee was in the process of drafting temporary legislation containing crucial provisions of the three belated bills.

If opposition leaders could “control voting by their parliamentary group,” said Moosa, the bill should easily be passed on Thursday.

“Increasing the number of days we spend talking here is not going to bring a solution,” said People’s Alliance (PA) MP Abdul Azeez Jamal Abubakr, arguing that the resolution would not make a difference “one way or the other” as the bills in question were at committee stage and the reviewing process could continue during the recess.

MDP MP Mohamed Riyaz however backed the resolution and criticised opposition MPs for questioning Mahlouf’s intent.

On the issue of unenforced sentences, the MDP MP for Dhandhoo claimed that there were 622 convicts out of jail when the previous government left office.

“Those who killed people [in custody] in Evan Naseem’s case are at home today,” he said, referring to eight former prison guards found guilty of beating a 19 year-old inmate to death in September 2003.

Moreover, Riyaz continued, failure to locate former Atolls Minister Abdulla Hameed to face charges of corruption shows that Commissioner of Police Ahmed Faseeh has “failed.”

MDP MP Ibrahim Rasheed meanwhile criticised the “lazy attorneys” at the Prosecutor General’s Office for failing to secure enough convictions.

In his turn, DRP Deputy Leader Ali Waheed argued that as the Maldives had a presidential system, it was President Mohamed Nasheed who should bear responsibility for the crime situation.

While police have recently revealed identities and crime records of 17 dangerous criminals, Waheed said that according to police statistics there are over 600 youth active in gangs in Male’ alone.

Moreover, he added, estimates from different state institutions of the number of convicts not serving sentences did not match.

Implying that he did not support the resolution, Waheed suggested breaking for recess to “give counselling to our political leaders” as they were “obsessed with winning power” instead of serving the public.

Independent MPs Ismail Abdul Hameed and Ahmed Amir meanwhile called for constitutional amendments to entrust wider powers to enforcement authorities, such as a longer period of detention and more legal discretion for judges.

Undelivered summons

Meanwhile in the continuing war of words between the rival opposition factions, DRP MPs Azim and Raheem alleged today that Deputy Speaker Ahmed Nazim – who was presiding over the sitting at the time – had dodged Criminal Court court summons eight times to date on the grounds that he was busy at parliament.

In March 2010, Nazim pleaded not guilty to charges of conspiracy to defraud the former Ministry of Atolls Development.

As the common man was routinely sentenced in absentia, said MDP MP Ahmed Easa, “what law is missing that the Honourable MP for Dhiggaru can’t be taken to court?”

Responding to accusations against the “missing” former Atolls Minister, MP Ahmed “Redwave” Saleem loudly denied the allegations against the long-serving Speaker of the People’s Majlis.

“There were big thieves in the previous government, why don’t you go find them?” he suggested.

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22 dead in gang violence since 2008: Home Minister

Some 22 people died of gang violence in the country since 2008, Home Minister Hassan Afeef informed MPs during Minister’s Question Time at parliament today amidst heightened public concern over violent crimes.

Responding to a query from MP Ahmed Mahlouf about police efforts to curb violent assault and organised crime across the country, Afeef explained that a special operation involving the capital police, special operations and serious and organised crime departments was currently underway.

In addition to increased police patrols, said Afeef, police were working with the Prosecutor General’s Office (PGO) to expedite cases and hold dangerous suspects in remand detention or monitored house arrest.

Afeef insisted that the government has not released convicts outside of the parole programmes, adding however that police were yet to find “about 300 people” sentenced in absentia.

“Now, as you know, some time ago a large number of people were sentenced in absentia,” he said. “There were about 300 people sentenced in absentia. We have to find out where these people are. We haven’t had complete information about them either.”

Afeef echoed concerns expressed by Commissioner of Police Ahmed Faseeh earlier this month that the main obstacle for effective policing was “the lack of a jail that could rehabilitate offenders and release them back to society.”

The Home Minister also flagged the issue of convicts escaping either directly from prison or during hospital visits in Male’ as a related problem.

Police meanwhile revealed last week that a large haul of dangerous weapons, including knives and a two-foot long sword, were confiscated from four houses in Male’ as part of the ongoing special operation.

Inspector Abdulla Nawaz, deputy head of the serious and organised crime department, on Thursday publicised crime records of “eight dangerous criminals,” most of whom had been arrested more than 10 times on average for offences such as violent assault and burglary.

“We will not hesitate to take a person to court for a third time,” an impassioned Nawaz told press. “If we have to do it for a fourth time, we’ll do it if it’s necessary, and keep him under policy custody for a fourth time if we have to. There is no other way that we can suppress this.”

During the past week, 53 suspects were taken into police custody and 14 were placed under house arrest, while 161 people and 45 minors were stopped and searched on the streets.

Anti-gang violence campaign

The Maldives National Broadcasting Commission (MNBC) meanwhile launched a special campaign last week to educate the public on the shortcomings of the criminal justice system and raise awareness about the challenges to public safety and security.

In a statement condemning Thursday’s knife attack on MNBC sports presenter Mohamed Sodiq, the public broadcaster said that “these brutal atrocities from out of control criminals” were intended to cause fear among citizens “and especially Maldivian journalists.”

Failure to enforce sentences and legal hurdles to securing convictions for “dangerous criminals” are the two main reasons for the worsening crime situation, the MNBC statement said.

While the lack of an Evidence Act and mechanism for witnesses protection has been identified as serious impediments, Deputy Prosecutor General Hussein Shameem told press last week that the absence of legislation was not the entirety of the problem.

“It is true, there are difficulties caused by the lack of Evidence Act,” he said. “For one thing, not knowing what kind of evidence will be accepted by court poses difficulties for us. However, we believe that this is a big opportunity for judges to contribute to the system.”

The PGO since 2009 has at times been at odds with the Criminal Court over the interpretation of existing laws.

At last week’s press conference however, Shameem revealed that two eye witnesses to gang violence who had retracted their statements at court have since been convicted to one year imprisonment each after being found guilty of giving false testimony.

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Government income must be doubled, says President

Government income has to be doubled to create fiscal space for increased capital expenditure and investment for development opportunities, President Mohamed Nasheed said in his radio address yesterday.

Speaking on the cabinet decision last week to incentivise voluntary redundancy in the civil service, President Nasheed reiterated that facilitating more attractive and higher paying employment opportunities for civil servants and government employees remains “a major goal for the government.”

“Development opportunities are going to be very limited if a large part of state revenue is recurrent expenditure,” he said. “We have to increase capital expenditure. The best way is to exponentially increase government income.”

While revenue was increasing year by year, Nasheed continued, current levels of annual income have to be “doubled” to make fiscal space for capital investments.

“It will take time for the state to reach that level,” he added. “It is necessary for the government to maintain recurrent expenditure at a certain level to reach [the goal]…The government’s purpose, or objective, is to find ways for employees to improve their standard of living.”

Under the scheme launched by cabinet on Tuesday, civil servants and government employees will be eligible for one of four retirement incentive packages: no assistance, a one time payment of Rf150,000 (US$11,700), a payment of Rf150,000 and priority in the small and medium enterprises loan scheme (for those 18-50 years of age), or a lump sum of Rf 200,000 (US$15,600) and priority in government training and scholarship programmes (for those 18-40 years of age).

Government employees above the age of 55 who retire voluntarily will be given the same benefits as those released by the Civil Service Commission (CSC) at the mandatory retirement age of 65.

The deadline to apply for the programme with the Finance Ministry is May 31, 2011.

Austerity battles

In August 2009, the government’s decision to implement austerity measures to alleviate the crippling budget deficit – including unpopular pay cuts of up to 15 percent for civil servants – was met with protests and fierce resistance from opposition parties and the CSC.

President Nasheed announced at the time that the government planned to halve the 32,000-strong civil service by 2011 through redundancies and transfer of employees to corporations.

While the President stated that the civil service should be composed of no more than 18,000 well-paid and qualified staff, CSC Chair Mohamed Fahmy told Minivan News last week that the commission currently has 19,000 permanent staff.

At the height of a protracted legal dispute between the CSC and government last year, the parliament-appointed independent commission was accused of attempting to topple the government and “plunge the Maldives into chaos.”

International organisations such as the International Monetary Fund (IMF) and the World Bank meanwhile insist that reckless expansionary fiscal policies from 2004 onward that saw doubling expenditure on salaries between 2007-2009 crippled the economy.

“The Maldives faces the most challenging macroeconomic situation of all democratic transitions that have occurred since 1956,” read a World Bank report in March 2010.

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HRCM, Gender Department condemn sexual violence “atrocities”

The Human Rights Commission of Maldives (HRCM) and the Department of Gender and Family Protection Services have strongly condemned the recent “atrocities” of sexual violence against minors, women and persons with special needs.

In a press release today, HRCM notes that the prevalence of sexual violence against the most vulnerable members of society, such as the elderly, under-age children and the disabled has “reached worrying levels.”

“We call on the government, state institutions, political parties, civil society organisations and all citizens to work together with renewed courage to stop such inhumane actions, save the community and establish a secure environment,” reads the HRCM statement.

Calling on the authorities to swiftly bring the perpetrators to justice in its press statement yesterday, the Gender Department warned that the surge in sexual violence cases has created an atmosphere of fear and caused psychological distress to a number of families.

Some 14 cases of child sexual abuse have been reported to the department so far this year, including the case of a Jamaaludheen School teacher arrested for allegedly molesting deaf children under his care.

Eight men were arrested last week in Haa Dhaal Dhidhoo for alleged abuse of a 13-year-old girl while among those arrested in other cases include fathers, grandfathers and relatives of the under-age victims.

Chief Inspector Ali Shujau, head of the family and child protection unit, told press today that police investigations have revealed that school children aged 14 to 18 were being lured to guest houses by adults.

Police found that minors were sexually abused at guest houses after being lured through the internet, he said.

In the first three weeks of April, said Shujau, 27 sexual violence cases were reported to police, including 16 child sexual abuse cases and 11 sexual assault cases.

Meanwhile the Health Ministry in collaboration with local NGOs ‘Hope for Women’ and the ‘Manfaa’ centre has announced a protest march in Male’ tomorrow to urge the authorities to take action, reports Sun Online.

The march is to begin at 4pm near the Social Centre and wind down at the artificial beach.

In Addu City, the Family and Child Service Centre in Seenu Hithadhoo together with local NGOs has planned a vehicle round from 4.30pm to 6pm Friday after a 74-year-old woman was brutally raped on Sunday.

According to Haveeru, the victim’s injuries were serious enough that she had to undergo surgery at the Hithadhoo Regional Hospital. A 19-year-old suspect has since been taken into police custody.

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MPs baulk at publicly declaring assets

Parliament yesterday reached an impasse on making MPs’ annual financial statements public after voting against a proposal put forward by the Ethics Committee.

According to Article 76 of the constitution, “Every member shall annually submit to the Secretary General of the People’s Majlis a statement of all property and monies owned by him, business interests and liabilities. Such declarations shall include the details of any other employment and obligations of such employment.”

Tasked by Secretary General Ahmed Mohamed in November 2010 to determine whether MPs’ financial statements should be released to other state institutions upon request, a majority of the 11-member Ethics Committee decided that the information should not be made available unless ordered by a court of law.

In a frenzied debate after the committee presented its report to the floor, MPs were however divided over the need for a public declaration of assets.

While several MPs argued that such sensitive information about MPs’ personal lives should not be made public at a time when “defamation and slander about MPs” were widespread in the media, others contended that the constitutional provision did not give MPs a choice in the matter.

“Some MPs have said the constitution does not say anything about making [the statements] public. The constitution doesn’t say that it should be released only if ordered by a court either, but that’s what we’re trying to do, and it is not acceptable,” argued MP Mohamed Thoriq of the ruling Maldivian Democratic Party (MDP), adding that the information should be published on the Majlis website and accessible to all citizens.

Hamdhoon Abdulla Hameed of the opposition Dhivehi Rayyithunge Party (DRP) urged MPs to consider that “if this information is not revealed or made public at all, the pointed fingers will be pointing towards all of us.”

Backing the committee recommendation, Minority Leader “Reeko” Moosa Manik said that while he agreed with the constitutional principle of publicly declaring assets and wealth, it was not advisable in “today’s political atmosphere.”

The MDP parliamentary group leader remains embroiled in an acrimonious feud with private broadcaster DhiTV, owned by business magnate “Champa” Mohamed Moosa.

Dhivehi Qaumee Party (DQP) MP Riyaz Rasheed concurred with Moosa, claiming that parliament should be concerned about concerted efforts by some media outlets to “disgrace and humilate MPs.”

“This is not being done by DhiTV’s owner or its management, we know that now” he said. “But previously we believed that it was planned and carried out by the management there. But that is not the case.”

Echoing a claim made by several MPs in past weeks, Riyaz alleged that unsuccessful candidates for parliament and their family members or associates were behind hostile media coverage of parliament.

“In truth, when the financial status of MPs is made known, some MPs will be worried and others will embarrassed,” said minority opposition People’s Alliance (PA) MP Abdul Azeez Jamal Abubakur.

“That is, those who have a lot of money might be very worried and those who do not will be embarrassed. Therefore, at a time when our status is being revealed in the media, I don’t accept at all that these facts should be available to just anyone.”

Independent MP Mohamed Nasheed meanwhile argued that MPs should not shirk from their constitutional responsibilities by blaming the media. “We will answer in the media to the things said in the media,” he said.

Impasse

At the end of the debate, the committee’s recommendation that financial statements should be released only if ordered by a court of law was put to a vote.

While the committee’s proposal was defeated 34 to 25, a motion proposed by Independent MP Ahmed Amir stating that financial statements should not be made public unless it was required for an investigation by a state institution did not pass either.

The MP for Kudahuvadhoo’s motion received 20 votes in favour and 38 votes against.

Since neither proposal was accepted, Deputy Speaker Ahmed Nazim declared the matter “void”.

“However, the Secretary General’s request for counsel on this matter has not been decided one way or the other,” he said. “So the Secretary General will go ahead with it according to the rules of procedure.”

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War of words escalate between rival opposition factions

Main opposition Dhivehi Rayyithunge Party (DRP) MP Abdulla Abdul Raheem has accused coalition partner People’s Alliance (PA) Leader Abdulla Yameen of “trying to destroy the DRP”, claiming that his opposition to the government is motivated by a desire to conceal an alleged illegal oil trade worth US$800 million.

At a DRP Galolhu centre opening on Monday night that saw the war of words escalate between the rival opposition factions, the DRP MP for Maafanu West called on Yameen to swear off claiming to hold the government responsible, because “you are more ruthless and a much bigger thief than that.”

“I will dare to say this, you are a much more ruthless and Jewish person,” he continued. “Don’t come in front of us again and say ‘hold the government accountable,’ we know that behind those devious plans lies the matter of that illegal oil trade.”

DRP Deputy Leader Ali Waheed meanwhile told supporters that they “should not run around forever considering any of our political leaders a god.”

“We don’t believe in a tribe, we believe in principle,” said Waheed, adding that origins or family descent did not matter in “today’s political reality”.

The DRP MP for Thoddoo went on to say that people came out to vote in appreciation of Gayoom’s contribution to the nation, “but it does not mean that [Gayoom] should come back, or that you should endorse your brother [Abdulla Yameen].”

In an appearance on private broadcaster Villa TV this week, Yameen defended his party against complaints of PA using the DRP’s name to organise rallies to promote his bid for the presidency.

“If by holding rallies there, Yameen is being promoted, if they accept that reality, then Thasmeen is free to hold rallies every night,” he suggested.

DRP Secretary General Abdul Rasheed Nafiz told press on Monday that the party has officially requested the Maldives Police Service, Male’ City Council and the Elections Commission (EC) to disallow activities held without official approval.

The move comes after the Gayoom faction organised a rally Saturday night in defiance of a council resolution requiring authorisation before using the party’s logo or seal.

Nafiz warned that the party would have to take the matter to court if the authorities proved unable to resolve the dispute.

In a statement from ‘Honorary Leader’ Maumoon Abdul Gayoom read out at the rally, the former President called on the DRP council – which the ‘Gayoom faction’ has boycotted in protest of Thasmeen’s “dictatorial” leadership – to retract its decision to recommend MPs Ahmed Mahlouf, Ahmed Ilham and Gayoom’s lawyer Mohamed Waheed for disciplinary action.

Faced with similar charges that saw Deputy Leader Umar Naseer dismissed in December, Ilham however contends that “a Deputy Leader can be dismissed only if a third of the party’s congress votes to dismiss him.”

At the ‘Thasmeen faction’ rally, Waheed, one of four Deputy Leaders elected at DRP’s third congress last year, derided his former colleagues claiming that “not even ten people in our rival faction’s front rank possess A’ Level certificates, how can they run the country?”

Spilling over

Meanwhile at Monday’s parliament sitting, MPs of the rival factions exchanged heated words and accusations during the debate on an amendment to the Clemency Act.

DRP MP for Mid-Henveiru Ali Azim accused PA MPs of “using another party’s name and its flag” to hold rallies to attack and undermine the DRP leadership.

Azim was cut off by Deputy Speaker Nazim – presiding over the sitting in the absence of Speaker Abdulla Shahid – who advised the MP to stick to the topic.

Picking up where Azim left off, Ali Waheed raised the issue of appointing a new Auditor General, a post that has remained vacant for a year.

“Are you afraid [to appoint an Auditor General]? What are you afraid of?” Waheed asked the PA Deputy Leader. “Shouldn’t you appoint one [by now] if you’re not afraid of the US$800 million oil and the flags?”

In March 2010, Nazim pleaded not guilty to charges of conspiring to defraud the former Ministry of Atolls Development.

Waheed went on to criticise opposition leaders for being “obsessed with winning power” and “completely lacking sincerity” for solving national problems.

“Opposition parties are attacking Kenereege Mohamed Nasheed. But matters amongst us are worse than Kenereege Mohamed Nasheed, Honourable Speaker,” he said.

Echoing Waheed’s sentiments, Abdulla Abdul Raheem asserted that “you can’t do things in this country anymore the way US$800 million of oil was illegally traded using STO.”

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Devaluation marks failure of economic policy: Yameen

The government’s decision to devalue the rufiya and replace the fixed exchange rate with a managed float marks the failure of its economic policy, claims minority opposition People’s Alliance (PA) Leader Abdulla Yameen Abdul Gayoom.

Addressing supporters at the ‘Gayoom faction’ rally last night, MP Yameen, half-brother of former President Maumoon Abdul Gayoom and long-serving Trade Minister in his cabinet, argued that the only circumstance where devaluation was advisable was to make the country’s exports cheaper and more competitive.

“[But] if the country does not produce a lot of goods for export, there will be absolutely no benefit from devaluing the currency,” he said, adding that the decision to devalue was both “political” and “an admission of failure.”

Following its inability to deal with the dollar black market two years after the formation of a parallel market, “what the government did was arrange a mechanism to auction the dollars [that they believe is being hoarded].”

The decision to devalue was therefore “political” as opposed to based on sound economic reasons, he said.

Yameen added that he believed the exchange rate would never fall below the pegged rate of Rf12.85.

“Since the way to get a good price for a scarce commodity is through an auction, they had to do this out of necessity and as a last resort, because they have no other way,” argued the MP for Mulaku.

However, he continued, the changes would be to no avail unless the country’s ballooning fiscal deficit is substantially reduced as urged by the International Monetary Fund (IMF).

Yameen went on to lambast the government’s infrastructure projects as well as preparations for the upcoming South Asian Association for Regional Cooperation (SAARC) Summit to be held in Addu City as “unnecessary spending.”

Conceding that floating the rufiya could solve the black market problem, Yameen however argued that those who had dollars would hesitate to release it if they did not have confidence that the rufiya would not depreciate further.

As a consequence of devaluation, Yameen predicted, inflation would rise by 30 percent: “For a person who gets Rf1,000 [as income], the value of what he can spend is actually Rf600, because of inflation. So, for example, if a can of Nespray [powdered milk] is sold for Rf28 today, with the change in the price of the dollar, we are saying it is going to cost Rf38…the biggest burden will be borne by the poorest.”

To back his assertion, Yameen referred to GMR’s recent 50 percent hike of lease rents at the Male’ International Airport, a decision likely to lead to a corresponding increase in air fare for domestic travel.

President Mohamed Nasheed meanwhile insists that the economy would stabilise over the course of the next three months and that the managed float was necessary “to ensure long term stability and prosperity of the Maldives.”

MMA speaks

Breaking its long silence on the dollar shortage, the Maldives Monetary Authority (MMA) issued a statement Thursday estimating that allowing market forces to determine a price within the 20 percent band of fluctuation would “solve the present dollar shortage in the near future.”

“We would like to take this opportunity to inform the Maldivian people that the MMA has undertaken various different efforts to solve the foreign currency problem,” it reads, adding that the central bank was in the process of strengthening the legal framework for monetary policy.

The MMA statement reveals that the Maldives had a managed floating exchange rate between Rf8.50 and Rf11.50 from 1987 to 1994.

On April 10, 1994, the floating rate was replaced with a fixed peg, which was then increased by nine percent in April 2001.

While dollar shortages had been experienced “occasionally in the past” due to strong demand coinciding with the Hajj (pilgrimage) or school holiday season, the MMA explains, an expansionary fiscal policy since 2004 coupled with the global recession in 2009 led to the formation of the dollar black market.

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