Author: Ahmed Naish

The State Trading Organisation (STO) has begun the sale of over 100,000 shares to the public today under the government’s privatisation policy.

Speaking at a press conference, Aishath Shaffana Rasheed, secretary general, said 138,472 shares will be up for sale from today to 10 January 2010.

When the sale of shares is complete, the share of the public in the company will increase from 7.71 per cent to 20 per cent and the government’s share in the company will be reduced from 92.29 per cent to 80 per cent,” she said.

She added the company aimed to eventually reduce the government’s share to 50 per cent.

The price of a share is Rf400 (US$31) with a face value of Rf50 (US$3.8) and an individual can buy a minimum of five shares, she said, while foreign investment companies will not be eligible.

Although a maximum amount has not been set, she added, under company regulations, an individual cannot own more than five per cent of the company’s shares.

Forms for the purchase of shares will be available from the STO head office and has to be submitted at the Bank of Maldives or its designated branches and mobile teams.

The purpose of selling STO shares is to reduce the government’s share and implement the government’s privatisation policy, she said.

Last year, STO handed out Rf65 (US$5) in dividends.

Shahid Ali, STO managing director, said the pro rata [in proportion] allotment of shares would ensure that all persons who apply for shares will be able to purchase even if the applications exceed the number of shares available for sale.

Mobile teams will visit the islands without bank branches to allow people to purchase shares, he said.

Farooq Umar, chairman of the STO board, said the five per cent ceiling will be a safeguard against companies purchasing more shares than the general public.

STO was established in 1964 to import essential food items, but has since diversified into areas such as energy and trade in consumer electronics.

The provisional income statement for the quarter that ended on 30 September shows that the company made a gross profit of Rf120.1 million (US$15.6 million) in the third quarter and Rf352 million (US$27.3 million) so far this year.

STO was registered in the Maldivian stock exchange in 2001.

Likes(0)Dislikes(0)

A Rf11.9 billion (US$926 million) projected mid-term budget for 2010 with a Rf4 billion (US$357 million) deficit was proposed to parliament by Finance Minister Ali Hashim today.

Presenting the budget, Hashim said unlike previous budgets, the International Monetary Fund (IMF) has confidence that next year’s budget could be implemented.

With government revenue projected at Rf7.3 billion (US$568 million), he said, the deficit for 2010 will be Rf4.6 billion (US$357 million).

“To plug this deficit, we have proposed estimated foreign aid of Rf1 billion (US$77 million) for the various projects in the budget, an estimated Rf384 million (US$29 million) from foreign loan assistance, an estimated Rf1.3 billion (US$101 million) from privatising government companies and an estimated Rf1.9 billion (US$147 million) from selling treasury bills through the MMA [Maldives Monetary Authority],” he said.

Revenue and expenditure

Measures to increase government revenue included the introduction of corporate taxation in 2010, he said, urging MPs to pass the taxation legislation before the end of the year.

Further, a GST (goods and services tax) will be imposed on tourist resorts and hotels in the final quarter of 2010, he said, which is expected to bring in Rf358 million (US$27 million) in revenue.

Hashim said introducing taxation was important to stop the “ad hoc” means of raising revenue.

He added the IMF, the World Bank and the Asian Development Bank (ADB) had repeatedly urged the government to institute sustainable sources of revenue.

Expenditure on travel, capital and recurrent costs has been reduced in the budget, he said.

He added expenditure on salaries for state employees was also reduced and revenue had to be increased beyond Rf7 billion to review the reduced salaries of civil servants.

The policy of creating “a small government” will be implemented in 2010, Hashim said, and funds for redundancy packages for laid off employees was included in the budget.

Further, a loan programme with assistance from the World Bank will begin in early 2010 to provide education and business loans for dismissed staff.

Surplus

By the IMF government finance statistics measure, the deficit for 2009 was 26.1 per cent.

But, said Hashim, if the mid-term budget was implemented, it would decline to 14.8 per cent in 2010, 2.4 per cent in 2011 and reach a surplus in 2012.

The structure of the budget was agreed upon after consultations with the IMF, he said, and included recommendations by the IMF, ADB and World Bank to solve structural problems in the economy.

The recommendations include reducing expenditure and size of the government, introducing targeted subsidies and transferring debt with the MMA to government bonds.

Further, he said, the IMF will provide a balance of payments loan to maintain foreign currency reserves, while the ADB and World Bank will provide loans for budget support.

Tourism

“In 2009, the Maldivian economy, especially the tourism industry, was severely affected by the global economic recession that began in the middle of 2008,” he said. “However, we have started seeing signs that the downturn is coming to an end.”

While tourist arrivals were expected to decline by 11 per cent in 2009, he said, arrivals picked up during the middle of the year.

The revised forecast for about 643,000 tourist arrivals in 2009 would be 5.9 per cent lower than the previous year, but 5.1 per cent better than the previous forecast.

The growth rate of the tourism industry slowed by 4.8 per cent in 2009, he said.

But, he added, since the industry has showed signs of improvement towards the end of the year the projected growth rate for 2010 is six per cent.

Further, it is expected to expand by 8.7 per cent in 2011 and 9.1 per cent in 2012.

Construction

As a result of the declining tourist arrivals, the dollar shortage and decreased capital investment, the construction industry was projected to contract by 16.8 per cent in 2009.

But, said Hashim, with the healthy forecast for the tourism industry and development of islands leased in 2004 expected to begin next year, the construction industry is projected to grow by 3.4 per cent in 2010.

Fisheries

Fisheries began to decline in 2006, with a 22 per cent contraction in 2007 and 7.7 per cent in 2008.

“In 2009, fishing is now expected to decline by 26.7 per cent. However, as the price of oil has fallen in 2009, it is now estimated that fisheries will improve in 2010,” said Hashim. “In 2010, the growth of the industry is expected to be maintained at 10 per cent.”

Balance of payments

Hashim said the balance of payments current account deficit was expected to be 25 per cent of GDP for 2009, compared to 51 per cent in 2008.

But, with imports expected to increase in 2010, the deficit is projected to widen to 28 per cent.

Export earnings in 2010 are projected to rise by 18 per cent with higher earnings expected from oil re-exports and new fisheries products.

The gross reserve was expected to climb to US$299.1 million in 2009, including the sale of US$100 worth of government bonds.

With tourism revenue expected to rise along with proceeds from privatisation and foreign assistance, Hashim said, the gross reserve was projected to be US$331.6 million at the end of 2010.

Deficit spending

The revised total expenditure for 2009 was Rf12.1 billion (US$941 million), the finance minister said, of which Rf6.2 billion (US$482 million) was government revenue and foreign aid.

Expenditure exceeded revenue by Rf5.9 billion (US$459 million), which was to be plugged by Rf1.1 billion (US$85 million) in foreign loans, Rf637 million (US$49 million) in loan assistance and Rf4.1 billion (US$319) expected from the sale of treasury bills and bonds.

At today’s sitting, a 15-member ad hoc committee was approved to evaluate the budget and present a report.

The budget debate will take place on 1 December.

Likes(0)Dislikes(0)

A right to information bill was submitted to parliament this week to ensure the government conducts its activities in a transparent and accountable manner, according to the president’s office.

Deputy Attorney General Abdulla Muizza told Minivan News today the bill was “very similar” to the current right to information regulations, noting the right was enshrined in the constitution.

Article 29 of the constitution stipulates that everyone has the freedom to acquire and impart knowledge, information and learning.

While the right to information regulations exist, Muizzu said an Act would be “more effective” and have “more weight”, adding that regulations have to be reviewed every year.

“Regulations can also be changed at any time by a three-member panel in parliament but an Act requires all of parliament to be changed,” he said.

Ali Shamaan, the editor of Hafta weekly, said the bill will compel government offices to provide information.

“Legal action can be taken against those who refuse, whereas under the regulations, there was no legal recourse,” he said.

The right to information regulations were adopted by presidential decree last year after a bill on the issue was rejected by parliament in 2007.

Shamaan said the 2007 bill had “serious flaws” as it was proposed by a “30-year-old dictatorship” that did not have any intention of providing information.

“But in the last few years of the Maumoon government, a circular was sent to all government offices asking them to provide information to media,” he said.

He added that the incumbent government had told offices to make information available and was confidence MPs would vote for the bill.

The right to information regulations came into effect in May but have been severely criticised by journalists, who have argued they hamper rather than ease access to information.

Under the regulations, all information must be provided within 30 days, which the Maldives Journalism Association (MJA) has argued should be shortened to 21 days.

The MJA further criticised provisions in the regulations which allow government institutions to extend the period from 30 to 60 days on a number of grounds such as if the information is not considered ready for publication.

The regulations have also been criticised for their numerous exceptions. Information can be withheld if, for example, it relates “to a third party, is a trade secret or goes against a prior agreement”.

In a UNESCO sponsored report published last month, Toby Mendel, senior legal counsel at Article 19, an international organisation that advocates for freedom of expression, said the regulations did not, appear to be implemented in practice or used by either citizens or civil society as a means of accessing information.

Likes(0)Dislikes(0)

The Dhivehi Qaumee Party (DQP) filed a case with the Election Commission (EC) yesterday, claiming that Male’ Municipality violated political party regulations by using government resources to build decorative Eid columns promoting the ruling party.

The columns, painted with Eid Mubarak (Happy Eid) as well as the ruling Maldivian Democratic Party’s logo of flowers, have been placed along Majeedhee Magu, one of the capital’s busiest shopping districts.

“The party believes that the objects kept on Majeedhee Magu wishing Eid Mubarak by the Male’ Municipality…was in violation of the spirit of the constitution…as it was done using government property to promote a particular party,” reads the DQP letter to the EC.

The party further alleged that the columns were made by the municipality’s road construction section during working hours by municipality employees.

In their letter, the DQP said the actions of senior officials of the municipality to promote the ruling party was “worrying” and contravened section 34 of the political party regulations, which prohibits the use of government property for personal benefit.

“The temple flower is the symbol of the MDP’s presidential candidate and yellow is the colour that symbolises the party. Since this was done to promote MDP in the name of wishing Eid Mubarak and is in violation of section 34 of the political parties regulation, we request that you investigate the matter,” it reads.

Male’ Municipality President “Sarangu” Adam Manik denied the allegations to Minivan News today, claiming the funds for the columns were raised by the Municipality Employees’ Association – a group of employees which carried out community work in Male’.

“They collect contributions from the general public…All institutions like Male’ Municipality have organisations that promote the well-being of staff and support such activities,” said Sarangu, adding that the columns were made with resources and assistance from “well-wishers” such as Vimla Construction. 

But DQP said it was unconvinced by the authenticity of the Municipality Employees’ Association, which was unknown to many of the staff at the municipality and, the party claims, was created a week ago with the sole objective of erecting the columns.

An employee at the municipality, who spoke on the condition of anonymity, said he did not know anyone in the association and had not heard of it until it was mentioned in the news.

On the inclusion of MDP’s logo on the columns, Sarangu said the columns had been built for the government’s one-year anniversary on 11 November, but were not erected due to rain. The columns were then re-used to mark the Eid celebrations, he said.

“Hassan Saeed is playing a very dangerous political game when someone is trying to do something for the betterment of the country,” said Sarangu. “The problem with the opposition is that they don’t know how to be the opposition and now society is getting more and more polarised.”

Although once a member of the coalition government, the DQP went into opposition in October, citing the government’s failure to bring the change promised during last year’s presidential election.

“What Hassan Saeed should do is come over to the ministry and see how I am managing the municipality, how I am cleaning the garbage on the roads, how I am doing community work and try and improve it through criticism or recommendations,” said Sarangu.

Mohamed Tholal, director general of the Elections Commission, said the commission was looking into the complaint but would most likely pass the case over to the Anti-Corruption Commission.

Likes(0)Dislikes(0)

The bill on outlawing places of worship for non-Muslims is a “useless” piece of legislation, Sheikh Hussein Rasheed Ahmed, president of the religious conservative Adhaalath party has said.

Speaking to Minivan News today, Rasheed said there were more important bills proposed by the government, such as the bill on taxation and the revised penal code.

“Some members are just trying to show that they’re doing something by proposing these useless bills to waste the Majlis’ time,” he said.

He added MPs were delaying the passage of legislation submitted by the attorney general that would be beneficial to the public and necessary for the government to function.

Last week, a bill proposed by Independent MP Ibrahim Muttalib on outlawing places of worship for non-Muslims was sent to committee with unanimous consent.

“There hasn’t been a temple built in this country so far even without this bill,” said Rasheed.

Unlike countries such as Lebanon and Nigeria, which had large non-Muslim communities, he said, the Maldives was a 100 per cent Muslim country.

“Since the constitution states all citizens have to be Muslims, there’s no need to build temples here,” he said.

But, he added, foreigners in the country should have the right to pray in the privacy of their homes.

Muttalib was the former treasurer of Adhaalath party, but was dismissed from the post following a dispute with the party.

Rasheed said he criticised the party in public after a proposal he made did not garner support.

“He has now sent a letter and resigned from the party,” he said.

Legal vacuum

Muttalib told Minivan News today he proposed the bill because there was no law to prevent the establishment of places of worship for non-Muslims.

He referred to article 19 of the constitution, which states “No control or restraint may be exercised against any person unless it is expressly authorised by law.”

“So there has to be a law to deal with this,” he said. “I did not propose it because I was pressured by any party.”

Muttalib said foreign elements were keen on establishing churches in the Maldives, as it was among only four countries, including Saudi Arabia, Mauritania and Iran, that did not have any churches.

While he could not name any particular organisation, Muttalib said a British delegation that met with senior members of Adhaalath party recently told them “this is not why we helped you bring democracy”.

“They said we helped you bring democracy so that we can worship here,” he said.

On MPs who had claimed the Prophet Muhammad (PBUH) allowed Jews to worship in Medina, Muttalib said he heard Sheikh Hassan Fikry retort on DhiFM that verses were later revealed commanding the Prophet to “throw them out”.

“They are unclean people,” he said. “They will not wish any good for us.”

Further, he continued, the Qur’an cautioned against friendship with Jews and Christians as they would not accept Muslims until they converted to their religions.

On Sheikh Rasheed’s criticism, Muttalib said despite their political differences he did not wish to challenge the Adhaalath Party president.

He called on the party to free itself from the government and speak out on important religious issues.

The party’s failure to speak out was causing public loss of confidence and ruining the reputation of religious scholars, he said.

“This is a very important time for the Adhaalath Party to come out and speak,” he said.  

Inquiries

Mohamed Zuhair, president’s office press secretary, told Minivan News today a number of inquiries had been made with the president’s office on the extent of religious freedom in the country.

On Friday, President Mohamed Nasheed asked for the ruling under Islamic sharia on allowing non-Muslims to worship in Islamic communities.

Zuhair said the Fiqh academy of the Islamic ministry will debate the matter and issue a ruling.

“We want to be very clear about this before we give a final answer,” he said.

Muttalib said he believed the president would ratify the bill if parliament passed it.

“I think what he expressed was the pressure that he is facing from the international community, from Jews and Christians,” he said.

National pride

Zuhair said the president’s office had received comments from foreigners who said they cancelled their holidays after learning of women being flogged and the public’s attitude towards corporal punishment.

He further said inquiries were made on the president’s office website about the possibility of tourists getting married in the Maldives.

“Marriage tourism is a growing segment,” he said. “We’ve had tour operators ask us if their clients getting married in the Maldives would be considered a religious ceremony.”

Presenting the legislation, Muttalib said the government’s plans to introduce wedding tourism would “indirectly” establish churches in the country.

“I want to say categorically that the government will not allow building temples or churches in the Maldives,” said Zuhair, adding claims during the presidential election that a Nasheed administration would build temples were completely unfounded.

Kulhudhufushi MP Mohamed Nasheed, an independent, said the bill was proposed after international organisations had discussions with MPs and the government “asking for more complete rights in the name of democracy.”

“It is a matter of national pride for Maldivians rather than a question of religion,” he said.

As other Islamic states allowed places of worship for non-Muslims, he said, the question of banning non-Muslims from worshipping publicly under Islamic sharia was “debatable”.

Likes(0)Dislikes(0)