“First of all, I want give you a bit of good news. The good news is that the Maldives is not about to disappear,” President Dr Mohamed Waheed Hassan has told a group of Sri Lankan businessmen in Colombo yesterday, according to media reports.
Speaking during his official state visit to the Maldives’ closest neighbour, Waheed told an assembled group of business heads at the Hilton Colombo hotel that the country could mitigate the effects of climate change and global warming.
Waheed made the comments in an attempt to assure his audience in Colombo yesterday that steps were being taken to stabilise the political climate in the country, as well to retain investor confidence.
The President said that large sections of the state budget were currently being spent on combating coastal erosion, providing clean water for the islands and developing renewable energy to minimize overall expenditure.
Since assuming the presidency, Waheed has pledged to work towards the previous administration’s carbon neutrality strategy, while also announcing intentions to make the Maldives the world’s largest bio-reserve.
There has also been discussion of a green energy fund to raise US$100 million for renewable energy projects through voluntary tourist contributions.
The country’s energy sector had been headed for a dramatic overhaul this year before the political instability surrounding February’s transfer of presidential was claimed to have deterred potential investors in such a project.
The Scaling-Up Renewable Energy Programme (SREP) promised to attract up to $3billion in risk-mitigated renewable energy investment and reduce the Maldives’ dependency on imported oil.
The environmental obstacles besetting the low-lying archipelago had been championed by former President Mohamed Nasheed, who garnered international media attention with his underwater cabinet meetings and a promise to make the country carbon neutral by the year 2020.
Nasheed’s media campaign was covered in the documentary film, “The Island President”, which highlighted his negotiations at the 2009 Copenhagen Climate Summit.
Before assuming office, Nasheed told international media that he had discussed the idea of purchasing land in Sri Lanka, amongst other nations, “as an insurance policy for the worst possible outcome.”
Investor Confidence
Waheed assured his audience in Colombo yesterday that the government was also focused on bolstering investor confidence.
Threats to renationalise Ibrahim Nasir International Airport (INIA) – currently being developed by Indian company GMR – have recently brought calls from within the national-unity government for greater consideration of the longer-term impact on foreign investment.
President Waheed is also reported as having told Sri Lankan media that both the economy and the tourism industry, which indirectly contributes around 70percent of GDP, were growing.
A President’s Office statement, however, has reported that Waheed told the group gathered at the Hilton that there had been a decline in the tourism industry recently.
The Tourism Ministry’s most recent figures show that, compared with the same point in 2011, tourist arrivals were up by 2.8 percent, whilst occupancy rates had dropped 1.2 percent.
Figures published by the Maldives Monetary Authority (MMA) show that the economy was expected to grow by 5.5percent this year, a slight slow down on the previous year.
Tourism Minister Ahmed Adheeb, who is accompanying President Waheed to Sri Lanka, was unavailable for comment when contacted today.
At present, a key economic concern to the government is the current budget deficit, anticipated to reach MVR9.1billion (US$590million) – over 28 percent of nominal GDP.
Haveeru reported that Waheed has informed the Sri Lankan press of austerity measures which were delivered to the Majlis by the Finance Ministry earlier this month.
The Sri Lanka Daily News meanwhile reported that he was in the process of finalising agreements which would strengthen bilateral ties in trade and investment as well as the legal and the educational sectors.
Minister for Economic Development Ahmed Mohamed and President’s Office Spokesperson Abbas Adil Riza were not responding to calls at the time of press.