Business & Tourism – Page 65 – Minivan News

Naifaru Court orders BML to issue dollars to Naifaru NGO

Naifaru Court has ordered the Bank of Maldives (BML)’s Naifaru Branch to issue an amount of dollars requested by the ‘Naifaru Juvenile’ NGO, after it sued the bank for declining to issue dollars because the NGO had deposited dollar cheques rather than physical cash.

Naifaru Court Judge Abdul Muhusin delivered the verdict yesterday and said that there was no legal grounds for the Bank of Maldives to withhold the money, and that all the dollars saved in the bank under Naifaru Juvenile’s name belonged to the NGO.

The judge also ruled that the bank had no authority to change the money into another currency when the owner requested it to be kept in the specific currency that the owner had deposited.

The money saved in Naifaru Juvenile’s account was money aid money from foreign parties to conduct different activities under agreements it had made, and if the money was not released, the foreign parties aiding the NGO might lose confidence in it, the judge said.

The judge also noted that its inability to draw on its funds could potentially lead to the NGO losing future agreements and aid from foreign parties.

BML and other banks in the Maldives are currently facing an ongoing major dollar shortage and have limited the amount of dollars they issue each day.

While the official exchange rate has been floated within 20 percent of the pegged rate of Rf12.85, it has sat for much of the year at the upper bracket of Rf15.42. The exchange rate on the black market is up to Rf20.

While dollars pour into the Maldives’ profitable tourism sector, much of this is swiftly banked overseas and little enters the local economy. The Maldives Monetary Authority (MMA) has never enforced regulations requiring use of the local currency and most tourism businesses continue to charge tourists in US dollars, greatly limiting demand for rufiya.

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GMR could colonise economy: DQP

A 24-page book released by Dhivehi Quamee Party (DQP) presents the government’s lease of Ibrahim Nasir International Airport (INIA) to developer GMR as a threat to local industry that will “enslave the nation and its economy”.

In the book, titled “Handing the airport to GMR: The beginning of slavery”, the DQP claim that the government has not only leased INIA operations to GMR, but has allowed the company to open other businesses in the Maldives.

GMR Male’ Retail was recently registered at the Economic Ministry. It is the second GMR business registered in the Maldives.

Citing information available in the public domain, DQP alleges that all Hulhule island lagoon resources will become the property of GMR, including the Hulhule Island Hotel (HIH), in-flight catering services and the Maldivian Air Taxi service.

Because salaries paid to Maldivian employees are a burden, the book claims, GMR will bring in Indian employees and house them in Hulhumale, “creating a visa-free zone for Indians to come and go”, reads Haveeru’s translation.

DQP further alleges that the airport development budget covers the expense of building hotels, offices and apartments on Hulhule but claims that there is no official requirement for GMR to develop a runway – apparently a key benchmark of local benefits.

Meanwhile, GMR today held a ground-breaking ceremony at INIA today to celebrate the start of work on a new terminal.

When asked about the groundbreaking, DQP member Dr Mohamed Jameel commented that “any development is good as long as it benefits the people of the Maldives. But the main benefit would be a new runway, and we don’t see that GMR is contractually obligated to construct one. Our question is, who will do the runway?”

London Heathrow has two runways, and is the busiest airport in the world with over 65 million passengers annually. The new terminal in the Maldives will take the airport up to a capacity of five million.

Jameel said completed development projects are not contributing to national development.

Other claims in the book include that all foreign currency earned at the airport is being deposited abroad by GMR, leading to the current dollar shortage.

Jameel called the book “a responsible work in the sense that it highlights issues relating to overall economy. This issue is very close to the hearts of the Maldivian people since the work at the airport was originally done by the Maldivian people. And we don’t agree that the people have the best deal.”

Minivan News asked whether use of the word ‘slavery’ in the book’s title had a purpose.

“In modern times people don’t colonise by taking over other countries, they colonise through economic and business ventures. A small country like the Maldives is very vulnerable to its economic needs. We have a history of neighboring countries manipulating the Maldives through economy, and it has been difficult to break those ties,” said Jameel.

President’s Office Press Secretary Mohamed Zuhair said he felt the title’s wording was “very strong”, and drew a faulty comparison between international cooperation for mutual benefit and foreign occupation of a people and market for selfish purposes.

“The purpose of all this is to make Maldivians mistakenly feel like they are under occupation and the country is being sold out,” said Zuhair, who pointed out that the government “wouldn’t have gone out for an international bid [on the airport project] if there was a way to borrow money and do it internally.”

He explained that the airport now yields “a bulk” of the national revenue, in dollars: “If foreign visitors increase, income increases. It’s simple math.”

He added that the negative publicity could have a negative impact on relations with “a very friendly neighbor, India.”

Ultimately, Zuhair doubted that DQP’s book would deliver the desired outcome.

“Attempts to ferment nationalist sentiment against a profitable corporation are bound to fail because people are more aware of the issues. The income the government makes from the airport is already double what the previous government made.”

An informed source close to the former regime told Minivan News that the former government’s plans for airport development were not Male’ based, but instead re-routed growth and profits to Maamigili. The source suggested that individuals close to former president Maumoon Abdul Gayoom were then in a position to “benefit significantly” from the plan.

“The opposition does not like that the current government is keeping the business in Male’,” said the source.

DQP plans to distribute 20,000 copies of the book.

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Falcon Energy consortium promises legal action against government over Gaafaru wind farm

Local newspaper Haveeru has published an interview with the purported managing director of the Falcon Energy Consortium, Steven David Jones, who told the paper the group would take legal action against the government’s termination of a US$370 million (Rf5.7 billion) memorandum of understanding (MoU) to develop a wind farm at Gaafaru, in North Male’ Atoll.

According to an email interview between Haveeru News and Jones’ Maldivian business partner, Falcon Energy claimed that it was not informed of the termination and had meanwhile invested nearly US$1 million (Rf15 million) in meteorological masts and initial readings.

The government has disputed the existence of a legally-binding contract since media reports of the termination were published in August. Maldives’ State Electric Company (STELCO)’s Managing Director Dr Mohamed Zaid had previously told Minivan News that no private partnership agreement had been signed with General Electric (GE) and Falcon Energy.

In 2010 STELCO signed a Memorandum of Understanding (MoU) on behalf of the government with Falcon Energy and GE. But according to Jones, STELCO then agreed to amend its supposed agreement with Falcon to reflect the extra cost of laying an underwater cable, a feature not previously included in the MoU.

After concerns were raised by the public over Falcon’s legitimacy, the MoU was terminated and the Gaafaru project cancelled.

Minivan News was told that reasons for the termination included a lack of consensus between the parties involved, and whether they had the requisite experience: “Falcon didn’t work out,” said one informed source, while “a lot of things were not carried out according to the memorandum of understanding,” said another. Local newspaper Haveeru meanwhile reported that there were concerns about pricing and profitability of the enterprise.

STELCO proceeded with an open tender for another project which led to the current deal with Chinese company XEMC.

Jones, however, told Haveeru that it was a “big shock” when the Maldivian government signed the deal with XEMC this August.

Minivan News could not obtain contact information for Jones at time of press, and was also unable to find any mention of an individual by that name in connection with a Falcon Energy group.

Haveeru’s Editor Moosa Latheef said the paper had solicited the interview, but did not have a phone number and was not willing to provide Jones’ email address.

Falcon Energy itself holds a scattered track record. The Group was originally presented as a consortium of four companies from the UK, Holland and Saudi Arabia. In media reports on the deal, the President’s Office said it understood that Falcon’s credentials included commissioned “onshore and offshore wind farms totaling 1,500 MW over the past 10 years, in the UK, Spain, Portugal, Ireland and Canada.”

International media and the renewable energy trade press widely reported that the Falcon Energy involved in the Gaafaru project was the Singapore-listed Falcon Energy Group, a major offshore oil and gas player. However that Falcon Energy bluntly denied any knowledge of the project when contacted by Minivan News following the collapse of the deal.

Falcon Energy earlier claimed that funding for the project would be provided by international bank loans. Yet at the time of signing the MoU, Falcon had still to raise the required investment with international banks. Research and observations from readers led Minivan News to find that the consortium had only a minimal web presence, which appear to no longer exist.

Furthermore, Falcon’s assessment of wind power in Gaafaru did not correspond with existing scientific studies on the matter.

In an article published in April 2010, Minivan News reported that figures published in a 2003 report by the US National Renewable Energy Laboratory (NREL) indicated that North Malé Atoll’s annual average wind speed was merely 4.9 m/s (17.7 km/h), while a utility-scale wind power plant requires at least 6 m/s (21.6 km/h), according to a 2005 report by the American Wind Energy Association (AWEA).

The report cautioned that a difference of just 1 km/h in wind speed could significantly bring down the productivity of a wind farm.

However, Falcon/GE project’s local leader Umar Manik told Minivan News at the time that engineering advances would enable the Gaafaru wind farm to run on a minimum wind speed of 5.7 m/s.

The utility of wind in the Maldives remains an open debate.

“Wind is an option, with other renewable energies,” said Assistant Director of Energy at the Environmental Ministry, Ahmed Ali. “The north has been found to be most productive area for wind turbines, but studies of met masts installed in the South, in Addu, are showing that it is feasible there as well.”

Meanwhile, an article published in the Telegraph critiqued the Maldives’ goal of achieving carbon neutrality via wind and solar power as expensive and difficult, particularly because the wind “scarcely blows in the islands for months on end.”

“What do you do in the eight months without enough wind?” asked President Nasheed’s Energy Advisor Mike Mason at Soneva Fushi’s Slow Life Eco Symposium earlier this year.

“What you do is put up solar. In that case, why bother to put up wind at all? With solar the sun rises every day – it is wonderfully predictable.”

Minivan News was unable to reach officials in the President’s Office, Economic Development Ministry, STELCO and any traceable affiliate of the Falcon Energy Consortium for comment at time of press.

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Independent MP proposes amendment to “defend” local businesses from airport developer

Kulhudhuffushi-South Independent MP Mohamed Nasheed has proposed an amendment to the Business Registration Bill in a bid to reserve airport shops and services for local ownership.

India infrastructure giant GMR currently claims exclusive rights to certain duty free items to be sold at Ibrahim Nasir International Airport (INIA), he said.

“My view is that GMR’s role has shifted from management to ownership,” Nasheed told Minivan News. “This is all about excessive and detrimental penetration into the local economy.”

A parliamentary committee is reviewing the bill and its proposed amendment.

In response to inquiries from Minivan News, GMR issued the following statement: “As part of the concessionaire we follow the terms and conditions of the agreement between the government of the Maldives and us and expect the government too to abide by it.

“The concessionaire agreement grants and specifies entitlement to directly or concession out retail activities at INIA.”

GMR is currently leasing Ibrahim Nasir International Airport (INIA) for a 25-year development project. Upon assuming management of the airport earlier this year, all airport shop contracts were set to expire on December 31, 2011 as per an earlier agreement with Maldives Airline Company Limited (MACL), with the exception of Spice Island.

The Economic Ministry today announced that GMR Male’ Retail has been registered in the Maldives. It is one of two locally-registered businesses under the corporation’s name.

Nasheed said his proposal refers to “duty free, customs clearance, cargo clearance, and the management of bonded warehouses,” industries which he believes can safely be trusted to Maldivian ownership.

“I have always objected to divesting ownership of Maldivian businesses with foreign investors when the business is within the local capacity and competency,” he explained.

“I respect that there are some areas of business and industry in which the Maldives has neither capacity nor competency. But the enterprises covered in my proposal have traditionally been local affairs. There is no reason to exclude them now simply as perks for foreign investors.”

Nasheed pointed out that many Maldivian businesses grew up around and depend on airport operations. Maldivian Island Aviation has allegedly lost business since the transfer of management, while the group running the Commercially Important Persons (CIP) lounge is now defunct.

In November of this year, GMR announced its intention to take control of cargo handling services starting in 2012. The move has allegedly forced Maldivian businesses Freight Forwarding Services and Bonito Group to lay off several employees.

In recent news, the Alpha MVKB duty-free shop at the airport was forcibly vacated by GMR and Customs officials eight months after GMR’s original notice. Rulings from the Civil and High courts upheld GMR’s right to terminate the shop’s contract, however company CEO Ibrahim ‘MVK’ Shafeeq has launched a protest under the slogan ‘Go GMR Go!’

“I understand the contractual obligation on the government’s part, and I respect the bidding process and the business competition that comes with it,” Nasheed reflected. “The airport is a gateway for tourism, but GMR’s excessively favorable terms are excessively disadvantageous to Maldivians.”

The Maldivian government signed a 25-year contract with GMR on 28 June 2010.

Under the contract the Maldivian government receives:

A sum of US$78 million as advance payment which is to be deducted from the profit due to government.
1% of the Gross Revenue in the first four years (2010-2014) and 10% of the Gross Revenue from the general business in the remaining years.
15% of the Gross Fuel Sales in the first four years and 27% of the Gross Fuel Sales in the remaining years.
GMR is also to invest US$375 million over a period of 25 years in construction of the new terminal.

Nasheed claimed that the government saw the GMR deal as an income generating source to solve income problems at the time. “But the deal wasn’t revised over the years,” and GMR has meanwhile made significant profits from jet fuel sale.

“GMR gets its fuel from State Trading Organisation (STO). STO rates have remained the same over the past year, however GMR’s rates have been raised twice.” He added that landing and airline fees have increased, and voiced concern that the price hike would deter business.

Meanwhile, GMR has recently opened a 30-office Airline Offices Complex, and several airlines including Ethihad and Hainan have lately begun services to Male’.

The Business Registration bill reserves certain areas of business for local owners. Nasheed said his proposal aims to enlarge that domain by two to three commodities.

“I intend to use my role as a parliamentarian to propose this amendment,” he said. “It’s just an initial step for the proposal, and I’m not sure whether it will survive the whole process. But I’m hopeful and I feel good about having done it.”

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Border loopholes benefit human traffickers: Immigration Controller

“If one country has a loophole, all countries suffer,” said Immigration Controller Abdulla Shahid, referring to the Maldives’ lack of a border control system amidst rising concerns over human trafficking. “The present border control system is only helping human traffickers.”

Authorities have reported a daily increase in human trafficking to the Maldives, particularly in the case of expatriate workers. The industry has a calculated value of US$123 million, making it the second largest contributor of foreign currency.

“This is a serious issue, there are about 40,000 illegal workers in the Maldives right now,” said Minister of Foreign Affairs Ahmed Naseem. “A border control system would be useful, especially in the future for maintenance. But there is a lot to do within the country as well, and we are currently trying to address these matters.”

The Maldives currently uses an eight year-old, outdated border control system. Plans to upgrade to a modern system have been delayed for over a year on allegations of corruption.

In November 2010, the government approved a Rf500 million (US$39 million) Border Control System by Malaysia’s Nexbis Limited, proposed by the Department of Immigration and Emigration.

Shortly thereafter, the Anti-Corruption Commission (ACC) requested that the agreement be halted due to “a serious public complaint” alleging corrupt dealings. The President upheld the ACC’s request in January 2011, by in May the Cabinet approved the program.

The ACC subsequently renewed its concerns and filed a case at the Civil Court and submitted a report to the Prosecutor General’s (PG) office earlier this month. The report accuses Former Controller Ilyas Hussain Ibrahim and Director General of Finance Ministry, Saamee Aqeel, then head of the Tender Board, for allegedly abusing their authority for undue financial gain.

Nexbis threatened legal action over the delay, citing millions of dollars in losses over equipment already imported to the Maldives. Shahid noted that the equipment is still sitting in Customs.

Immigration matters

Shahid said the public misconception that Immigration is a mundane department doing no-brainer tasks has led to a general misunderstanding of need for a border control system.

“Immigration personnel have to be trained to detect forgery, to profile passengers–we recently had courses for officers on how to detect physical alterations like makeup.

“In general, the public is not aware of the system’s value. It is to everyone’s benefit, even distant countries, to have a strong border control system in the Maldives. Terrorism and human trafficking involve other countries and their borders. If we have good communication, starting at Immigration, and a system, then we have good results.”

Currently a passport check requires an individual to manually scan hundreds of photographs, Shahid said. Without the key components of a modern system – facial recognition, finger-print identification technology, and eye scans – “people who were deported on criminal violations can re-enter the country. If they have a new or fake passport, we rarely detect them with our current system,” Shahid explained.

“A passport is just a piece of paper nowadays. The modern system, with the recognition technology, is almost a 100 percent guarantee of proper identification,” he added.

Nearby Sri Lanka, Thailand and Malaysia have been using modern systems for years.

“I think the proof is strong enough”

Shahid believes that cases against Ibrahim and Aqeel will be difficult to ignore in a court of law.

When the Nexbis system was first considered, a proposal was sent by Immigration to the National Planning Council. According to Shahid’s review of the documents, the final contract drafted deviated significantly from the initial proposal.

“The proposed system could be implemented in six months for US$4-5 million, with the company charging a further US$150-200 thousand per year for maintenance,” he asserted.

“According to this, the Maldives would pay US$8 million in the first year to Nexbis. Over 20 years that would be US$4 million paid annually. That’s fair. But right now the Nexbis plan is one-third of the budget.”

Taxes are also a consideration, particularly given the high numbers of foreigners and expatriates traveling through the Maldives.

“In 2011 we are reaching 1 million foreign arrivals. If we charge US$2 for arrival and US$2 for departure, that’s US$4 per person. Annually, the government would collect US$4 million for Nexbis. It would break even.”

Nexbis proposed these charges as part of its 20-year contract with the government in 2010.

“This means that neither the government nor the Maldivian public have to pay in exchange for a state-of-the-art border security protection,” Nexbis earlier claimed.

Shahid also noted that GMR is expanding Ibrahim Nasir International Airport (INIA) to accommodate 3 million arrivals annually, indicating that revenue will increase.

Nexbis also planned to levy a US$15 fee for expatriate identification cards. With the current 100,000 registered expatriates, Shahid said, the company receives US$1.5 million annually from expatriate cards alone.

“Nexbis will get US$27.5 million in 2025, according to the current statistics,” he said. Calculating for a gradual increase of arrivals over the next 20 years, “the generated revenue could build an airport of GMR’s standards and implement an up-to-date border control system.”

According to Shahid’s calculations, the approximate cost in the first year of installment and operation (US$8 million) of a Nexbis-quality border control system is far lower than the cost proposed in the final contract (US$39 million).

Shahid earlier estimated that maintaining a free system given by a donor country would cost at most several hundred thousand dollars a year, and said he was unsure as to why such an agreement had ever been signed.

“I don’t know much about the details of the ACC’s report,” he concluded. “Since I saw the contract for the Nexbis system, my argument has always been that the amount charged is ridiculous. It should not be done and must be halted. It is wrong.”

Ilyas Hussain Ibrahim declined to comment on the grounds that the issue was “politically risky.”

The Nexbis case is currently the largest corruption case before the courts and PG, the ACC confirmed. While corruption charges are regularly issued in the Maldives, resolution at the PG level is not so common. Speaking to Minivan News on the occasion of International Anti-Corruption Day, ACC President Hassan Luthfee said that of the 16 cases filed with the PG this year, zero have been addressed.

Vice President Muaviz Rasheed today said the ACC had received no information from the PG, but was hoping for the Civil Court’s ruling by the end of this month.

“The Civil Court has not been cooperative with the ACC on all counts, however the hearings ended in late November and we expect a ruling within the month,” Muaviz said.

Banana republic?

Although Shahid is confident in the court, he is unsure when the Maldives will take actual steps towards updating its border control system.

Without local capacity and expertise to produce a state-of-the-art border control system, the Maldives would turn again to the international market. Shahid said there are many options: “we could go anywhere, we could even get it as foreign aid.”

But after the dealing with Nexbis, withstanding international scrutiny could be difficult.

“Nexbis sees the Maldives as a banana republic that it can squeeze money out of,” Shahid observed.

With a score of 2.5 on Transparency International’s Corruption Perception Index and ranking 134th out of 185 countries, the Maldives may not be so inviting to foreign investors.

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High Court rules against Alpha MVKB duty free shop

The High Court today backed the Civil Court ruling that GMR’s decision to terminate its contract with Alpha MVKB duty free shop at the Ibrahim Nasir International Airport in March was valid, and that MVK’s request to extend the notice until December 31 violated its contract with GMR.

According to the ruling, GMR had vacated the Alpha MVKB Duty Free Shop at Ibrahim Nasir International Airport (INIA) legally and according to the agreement between both companies.

The High Court noted that GMR gave notice on March 1 and, as per the agreement, the contract terminated on March 31. As no party could extend the termination notice, the court concluded that MVK had no right to remain at the airport without approval from GMR.

Alpha MVKB was leased for 10 years under an agreement between MVK and Maldives Airports Company Limited (MACL). The agreement requires the party wishing to terminate the agreement to give a one-month notice; the High Court stressed that both parties had that right.

The High Court also denied MVK’s request for a temporary order allowing them to run the duty free shop through December 31 on the basis that the case had been closed.

Airport shops contracted under Maldives Airports Company Limited (MACL) were allowed to remain in operation for one year after GMR took over airport management. As per the MACL contracts, all shop contracts will terminate on December 31 of this year.

GMR said it has given the required 90-day notice to all shops except Spice Island, which will remain in service. Plans for new shops are unclear, however GMR has said it welcomes any company offering a product appealing to locals and foreigners alike.

Minivan News made repeated calls to Alpha MVKB Managing Director Ibrahim Shafeeq, MVK and Alpha MVKB offices, but had received no response at time of press.

GMR officials today said they could not issue a comment on the case until they received an official notice of the ruling.

Earlier this month, Customs officials intervened when GMR officials began dismantling a temporary wall outside of the Alpha shop and packing up goods.

“Duty-free goods are Customs’ responsibility, and we will be involved in the process of opening or closing duty-free shops,” said Customs Director Ismail Nashid. “As for the goods involved, there are several options for the shop owner to choose from including importing the stock to the Maldives or selling it internationally.”

GMR officials earlier said that action was taken against the shop after several notices for evacuation had been ignored, thereby complicating the airport renovation schedule.

The airport renovation is the single largest foreign investment in the Maldives at US$400 million. GMR is upgrading the old terminal ahead of completing construction of the new terminal in 2014, and will operate the airport for 25 years under a concession agreement signed last year with the government.

GMR has faced repeated legislative battles since it entered the contractual agreement.

Opposition Dhivehi Qaumee Party (DQP) earlier filed a case challenging GMR’s right to collect a US$25 (Rf385.5) Airport Development Charge (ADC) and US$2 (Rf30.8) Insurance Charge commencing January 2012. The DQP had claimed that a pre-existing Airport Service Charge (ASC) of US$18 (Rf277.56) invalidates the ADC.

The Civil Court ruled against GMR on December 8 on the grounds that a clause in the concession agreement with GMR violated the Airport Service Charges Act of 1978, which was amended in 2009 to raise the charge to US$18 for foreign passengers and US$12 for Maldivians above two years of age.

The government has said it will likely appeal the lower court’s ruling, given its contractual obligation to GMR.

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Dhiraagu begins laying 1253 km of fibre optic cable

President Mohamed Nasheed inaugurated the cable laying of the Dhiraagu’s new fibre-optic submarine cable network in Haa Dhaalu Kulhudhufushi on Tuesday.

Dhiraagu described the US$21.7 million mega project signed with Japanese communications group NEC as the “back bone” of Dhiraagu’s High-speed Network Rollout Program, aimed at expanding broadband service across the country.

NEC will be using its existing experience of working on the country’s cable system to lay 1253 kilometres of fibre optic submarine cable beneath the sea from the north to south, connecting the whole country.

According to Dhiraagu, the cable network will encompass eight strategic locations including Kulhudhufushi (starting point), Baa atoll Eydhafushi, Hulhumale’, Alif Dhaal atoll Dhangethi, Laamu atoll Gan, Gaaf Dhaal atoll Gahdhoo, Seenu atoll Hithadhoo and Fuvahmulah (ending point). Cable landing stations have been built.

“We are expecting to finish the cable laying process by the end of this month. Then we will continue testing the cable, connectivity and monitoring the traffic. We are hoping to complete the project by the second quarter of next year,” Dhiraagu’s Manager of Marketing Communications and Public Relations, Mohamed Mirshan Hassan, told Minivan News on Wednesday.

He highlighted that the project was a significant part of the Dhiraagu High-speed Network Rollout Program to expand broadband services, under which the company plans to enhance the microwave network, 3G service, wireless broadband services and upgrade the internet core network.

Dhiraagu plans to invest a total of about US$70 million on the project over the next five years.

According to Mirshan, the implementation of the project will mark a “new milestone” for the nation’s telecommunications.

“High-speed broadband internet service will facilitate services such as e-health, telemedicine, e-government and other online services in the country, which would bring immense socio-economic benefits,” said Mirshan. “Communication and connectivity is a prerequisite for the development of a nation,” he added.

He noted that online businesses and the tourism sector would benefit immensely from the project, as their online operations such as ticketing, bookings and payments would be become easier with the high speed network.

“The disparity in the services offered to remote islands will also be significantly reduced, allowing them to enjoy the same service packages currently offered in the capital Male’,” Mirshan added.

Speaking at the inauguration event on Tuesday, President Nasheed said that the exchange of information was of extreme importance to national development.

The “slow speed of broadband internet in the country prevents full accessibility to telecommunications across the Maldives”, and often led to system failures, President said.

However, he believes Dhiraagu’s submarine cable project will bring significant improvements to the nation telecommunications, by “making the conveyance of information easier, better and speedier in the future”.

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GMR dismantles Alpha duty-free

GMR officials yesterday began to physically remove the Alpha MVKB Duty Free Shop at Ibrahim Nasir International Airport (INIA) after “several notices” to vacate the area were “ignored”, according to GMR’s Head of Corporate Communications, Mahika Chandrasena.

MVKB shop assistant Mohamed Nishwan told local newspaper Haveeru that GMR officials entered the shop around 2:00pm and began packing goods into boxes. They also began disassembling temporary wooden walls which were erected in late November to signify that the shop, which sells alcohol, cigarettes, and watches, was closed.

Customs officers arrived at 4:00pm to stop the disassembly, Haveeru reports.

Chandrasena said the shop’s owner had ignored numerous notices to vacate the premises, to the point that that they were blocking development at INIA.

“The gentleman was supposed to vacate by a certain date and he didn’t. We had to close the shop because we have deadlines to re-vamp the duty free area. GMR gave him a lot of time and postponed the deadline several times, but he refused to leave and we had to physically remove the shop.”

Chandrasena said she understood that Customs intervened because of the presence of alcohol among the shop’s stock. “They needed to make sure it didn’t leak into Male’. That’s Customs’ purview,” she said.

One area of the shop has been vacated but GMR is now waiting for the shop owner to remove the rest.

“This is nothing to do with him personally, but we have deadlines we need to meet on our renovation,” said Chandrasena.

GMR’s action was supported by a ruling from the Civil Court, however Alpha MVKB had appealed the ruling in the High Court.

Police Sub-Inspector Ahmed Shiyam said police supported customs officials in the operation.

“We advised GMR to follow Customs’ procedures. There was some dispute but no confrontation,” he said.

Customs Director Ismail Nashid could only confirm that the contents of a duty-free shop were under Customs’ purview and that any disagreement over the shop was between Alpha MVKB and the landlord, GMR.

“Duty-free goods are Customs’ responsibility, and we will be involved in the process of opening or closing duty-free shops,” he said. “As for the goods involved, there are several options for the shop owner to choose from including importing the stock to the Maldives or selling it internationally.”

Nashid confirmed that the shop is not currently in operation, but said the decision to remove the shop from the airport would be made by GMR.

Alpha MVKB Managing Director Ibrahim ‘MVK’ Shafeeq today told Haveeru that GMR’s management style was “dictatorial” and “backed by someone.”

“We’re now seeing a foreign party trying to overtake us. How can they enter duty free shops like that and take out the goods? It shows that they have the power and that they’re operating with backing from someone,” he said.

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“Systemic failure to address corruption”: Transparency Maldives

The Maldives has risen slightly to rank 134 in Transparency International’s Corruption Perception Index (CPI).

The country scored 2.5 on a scale of 0 (highly corrupt) to 10 (very clean), placing it alongside Lebanon, Pakistan and Sierra Leone.

The score however is a mild improvement on 2010, when the Maldives was ranked 143th and below Zimbabwe. The Maldives still rated as having higher perceived corruption than many regional neighbours, including Sri Lanka (86), Bangladesh (120) and India (95).

Project Director of Transparency Maldives, Aiman Rasheed, warned that the ranking could not be compared year-to-year, especially in the Maldives where there were only a three sources used to determine the index (India has six).

“Corruption in the Maldives is grand corruption, unlike neighbouring countries where much of it is petty corruption,” Rasheed said. “In the Maldives there is corruption across the judiciary, parliament and members of the executive, all of it interlinked, and a systemic failure of the systems in place to address this. That why we score so low.”

Faced with such endemic and high-level corruption, it was “up to the people of the Maldives to demand better governance”, he said.

Addressing corruption would have political ramifications for the 2013 presidential election, Rasheed agreed, especially for young voters – 40 percent of the population is aged 15-24, resulting in thousands of new youth voters every year.

“Young people are hugely disillusioned by corruption in the Maldives. They have a vision of the type of country they would like to live in,” he said.

New Zealand, Denmark and Finland ranked as having the least perceived corruption, while North Korea, Somalia, Afghanistan and Burma ranked last.

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