Category: Business & Tourism

Maldives business news

Garbage floats freely from “impatient” boats

The Environment Protection Agency (EPA) has blamed a surge of garbage floating in Thilafushi lagoon on “impatient” trash boats; trash which is now flowing into the sea.

In 2009, the UK’s Guardian newspaper reported that 330 tons of waste are transported in Thilafushi island for processing. Thilafushi is commonly known as ‘garbage island’.

Head of the EPA, Ibrahim Naeem, said a “huge amount of garbage” has been collecting in the ocean, due partly to a change in tides. Speaking to Minivan News today, Naeem did not want to say whether the trash was coming from resort boats, but did say the problem “involves everyone”.

“The mechanism for waste collection and disposal needs to be improved,” he said. “The EPA has to do some work on the matter, and the people who are bringing in the garbage and contributing to its buildup also need to take responsibility.”

Naeem said the EPA had photographs and names of several boats that had been dumping garbage into the sea. The agency is now investigating 10 cases.

Naeem said legal action will be taken against boats caught dumping garbage, which would affect fishing and tourism, two of the country’s largest economic contributors.

Yet there are signs that both the garbage and a lack of regulation may already be affecting tourism. In a recent interview with Minivan News, French tourist Marie Kivers noted a lack of waste bins on Male and Guraidhoo.

“It’s funny because we who live abroad think that Male’ will be an example for the world about pollution and everything, since global warming is important here. But when you see the inhabitants in the Maldives, they put anything into the sea,” she said.

Some boat captains have claimed that boats from islands, safaris and resorts dump garbage into the lagoon instead of anchoring near Thilafushi, reports Haveeru. An earlier rule stating that garbage had to be dumped before six in the evening likely contributed to the rushed habit.

Reports indicate that the waste exceeds the capacity of Thilafushi. Naeem says some boats are getting impatient.

“The facility at Thilafushi is designed so that only two or three boats can dock and dump at a time,” said Naeem. “If the waste is not removed from the area, however, or the boats take a while, other boats won’t be able to get in and dump their waste.”

The EPA has said that arrangements are being made to ensure that waste is only dumped on the island under the supervision of a council employee – a thing earlier practiced, reports Haveeru. An official also said that boats traveling to Thilafushi will be charged according to waste weight.

Thilafushi is currently the only island designed for waste disposal in the Maldives. Naeem told Minivan News that there are plans for a new site to be developed in Raa Atoll.

Likes(0)Dislikes(0)

Wataniya launches Blackberry service in the Maldives, enabling secure private communications

Mobile operator Wataniya last night launched the Blackberry service in the Maldives, at a ‘black suit’ event held in the National Art Gallery.

Beyond just a range of smart-phones allowing for ‘push’ email connectivity, the Blackberry service is one of the world’s largest private networks with 67 million subscribers and 14.8 percent of the global smartphone market.

The device, produced by Canadian technology company Research in Motion (RIM), grew in popularity on the back of business and corporate users, attracted by its security features, reliability and strong encryption.

The event last night opened with a dance by a man in a glow-in-the-dark jumpsuit, and a band playing the Beatles tune ‘All you need is love’.

Vice President of the Maldives Dr Mohamed Waheed remarked that RIM’s decision to enter the market in the Maldives “is a vote of confidence in the business environment of our country, and for that we are grateful.”

Dr Waheed also noted that the introduction of consumer and business-grade secure communications in the Maldives was “an indication of how our country has matured”, and “an indication that our country is comfortable with the freedoms that we have; particularly the freedoms of expression and democracy.”

“This is an important step towards the improvement of commerce and business in the Maldives,” Dr Waheed said, adding that the country’s “dynamic, highly literate and IT savvy youth” would ensure “a bright future” for Blackberry in the Maldives.

Chief Operating Officer of Wataniya Stephen Smith said the company was proud to enter in partnership with RIM, “to provide the highly anticipated service to customers in the Maldives for the first time. Blackberry provides a meaningful and secure connection to enterprise email and other important systems, and we’re glad to be able to provide this capability to our customers.”

Canadian High Commissioner to Sri Lanka and the Maldives, Bruce Levy, meanwhile observed that without their Blackberries, the Canadian government “would shut down overnight.”

“The first thing I saw when I landed in the Maldives was a fleet of twin otter seaplanes, many of which are piloted by Canadians. The delegation tonight is staying at Four Seasons, an eminient Canadian hotel chain, and the President is off to the Toronto International Film festival this weekend,” Levy said.

“It is a great time to be Canadian in the Maldives.”

Likes(0)Dislikes(0)

Opening of premium lounge hints at airport’s future

The Plaza Premium lounge was inaugurated today at Ibrahim Nasir International Airport (INIA), a step in GMR’s wide-scale renovation of the airport terminal.

The renovation, which began approximately 10 weeks ago, was designed by Hong Kong-based Premium Port Lounge Management Company Private Ltd. A message from company founder and CEO, Song Hoi See, indicated that the company was eager to design the project and “add more flights to Male.”

The Plaza Premium lounge was opened with a ribbon-cutting ceremony and a reading from the Qur’an. Among the officials who cut the ribbon were Tourism Minister Maryam Zulfa and GMR CEO Andrew Harrison.

“This is a proud moment,” said Zulfa. “It is sad that some of the resorts and institutions in the Maldives do not measure up to the standards of our premium customers. I am happy that GMR is setting an example for the Maldives as it moves forward.”

Zulfa, who arrived today from an international flight, described some fellow passengers who called a baggage delay “typical.”

“I said, ‘No, this is not typical. This is atypical. Because GMR is now taking care of us.’ It was a relief to know that a negative experience was not typical of how our airport works.”

Tourism Minister Maryam Zulfa surveys the Plaza Premium Lounge with GMR CEO Andrew Harrison

Baggage beltways were recently expanded, while eight check-in counters and two security lanes are being added. “We are de-bottlenecking departures, and things are running smoothly,” said GMR Chief Commerical Officer Prasad Gopalan.

Gopalan said the airport had seen an even higher increase in traffic this year than expected. “There is more traffic from Asia, and we are expecting Russian traffic to increase as well.”

Harrison said the renovation process had informed GMR of the higher standards that travelers now hold. He noted that washrooms and check-in counters were being refurbished “to make it a more ‘Maldives’ welcome for travelers,” and added that former staff had been re-trained to meet premium standards.

The lounge is open to first and business class passengers, and to economy class passengers for an undetermined fee. Services include a buffet and a la carte menu, computer and internet access, television, and spa-style foot rubs.

Harrison told Minivan News that “the quality of this lounge is a commitment to the quality of airport that the Maldives and its visitors can expect to see in the future. Even though this lounge is an asset with a short shelf life, it is appropriate that we demonstrate what the new terminal should be like.”

The new terminal at INIA is expected to be completed over the next three years, and will have a capacity of 5 million.

The renovation’s estimated cost is US$1 million. More renovations will be completed before the tourism peak season of November and December.

Likes(0)Dislikes(0)

Third of government’s Dhiraagu shares to be made public

The government has decided to release a third of its shares in local telcoms giant Dhiraagu to the public.

Dhiraagu a major player in the telecommunications, mobile and broadband internet markets of the Maldives, and is one of the country’s most profitable companies.

The government will make a third of its shares available to the public from October, to both local and foreign parties, reports Sun Online. Share prices have not yet been published.

The Maldivian government previously held 55 percent of Dhiraagu’s shares, while the British company Cable and Wireless held the remaining 45 percent. Upon winning the 2008 presidential election, President Nasheed’s government sold 7 percent of the shares to Cable and Wireless, reducing government shares to 48 percent and giving Cable and Wireless a controlling interest.

Minister of Economic Development and Foreign Trade, Mahmoud Razee, told Sun that studies would determine the prices and ratios of shares to be offered in local and international markets, and that the shares would be “affordable” to the average Maldivian.

Minister Razee also stated that as Dhiraagu was a strong company, people could benefit from buying its shares.

Opposition Dhivehi Rayyithunge Party (DRP) Deputy Leader Ibrahim ‘Mavota’ Shareef told Minivan News that the shares were valuable, but said he was not in favor of selling them.

“As far as [the DRP] is concerned, we do not believe this is a wise decision. Dhiraggu is a very profitable and well-managed company, and it makes a lot of money for the government. This is a time when we are undergoing an economic crisis, and we cannot afford to have these shares dispersed.”

Shareef said he thought most Maldivians would be interested in the shares, but said he doubted whether the majority of people would be able to afford them.

“The people who have the capacity to buy these shares are either foreign companies, or very rich Maldivians,” he said.

The government estimates that the sale of the shares will generate Rf 1.46 billion (US$95 million).

Shareef said the outcome would be obvious as soon as the shares hit the market.

“In the Maldives, we know who has the money. We know a majority of people don’t have the money. There must be some political reason for this decision, it’s not just an economic strategy,” he suggested.

Likes(0)Dislikes(0)

China leads Maldives’ 18 percent tourism boom

Over 700,000 tourists visited the Maldives in the first seven months of 2011, the majority of visitors from China.

The Tourism Ministry has released data showing that the number of tourists who visited the Maldives between January and July 2011 increased by 18.3 percent to 520,483. This was compared to the 439,864 tourists who visited the Maldives during the same period last year.

Maldives Association of Travel Agents and Tour Operators (MATATO) Secretary General, Mohamed Maleeh Jamal, told Minivan News that the timing of Europe’s economic decline matches that of the growing Chinese market. Asia’s high season corresponds with Europe’s low season, he said, and resorts are now catering more to Chinese tourists to keep business up.

Jamal also noted that airlines such as Qatar Airways had increased direct service to the Maldives in the last 10 months. He also noted that more airports are being constructed closer to resort islands, such as in Baa Atoll.

“The President has also decided to increase the marketing budget from US$1.5 million to US$7 million, since we expect the industry’s growth to continue,” said the MATATO secretary general.

Statistics show that Chinese tourists dominated the market in the first seven months with 103,734 individuals, accounting for 19.9 percent of the total arrivals. The United Kingdom was the second-largest contributor to tourism arrivals, composing 11.7 percent of the market.

Jamal forecasted “phenomenal growth” in the Chinese market, and estimated that the Chinese would account for 40 percent of the total tourists in coming years.

The Maldives currently hosts over 100 resorts boasting a total of 22,000 beds. Jamal said 3-4 more resorts were currently under construction, and noted that it was important “to always have excess demand and limited rooms to keep the appeal of the Maldives up.”

Secretary General of the Maldives Association of the Tourism Industry (MATI), Ibrahim Mohamed Sim, was more guarded on the issue. Sim told Minivan News that “we are holding steady in growth, but the market looks mixed since the decline of the US economy could affect our traditional European markets.”

Italy and the UK, formerly leading contributors to the Maldivian tourism industry, have declined, said Sim, but Germany was holding steady.

Sim said the demand from China was significant, and that the Maldives “is in a very lucky position to have the chance to meet that demand.”

Sources in the Chinese media and Mandarin-language tourism forums have meanwhile noted the rise of practices such as segregation of Chinese visitors from other guests at meal times.

Sim commented that although he did not believe there was segregation, the Chinese “stand out, they come here for a different reason than most tourists. They do not come here to sun tan, they come here to see a different place.” He noted that some resorts were also designed to specifically appeal to different groups.

Another recent event in the Maldives’ tourism industry was its withdrawal from the New7Wonders competition.

Jamal told Minivan News, “we think it was a loss that the Maldives pulled out. New7Wonders was a marketing tool, and major tourism companies were competing for the award.”

However he said he did not think that the Maldives’ decision had affected the tourism industry.

Likes(0)Dislikes(0)

Parties stake positions on economic reform bills

The ruling Maldivian Democratic Party (MDP) and opposition Dhivehi Rayyithunge Party (DRP) have staked rival positions on the economic reform bills currently before parliament.

With two pieces of legislation of the 18-bill reform package completed by committee and up for a final vote next week, the majority and minority parties in parliament declared their stands at press conferences yesterday.

Briefing press at the MDP office, Majority Leader Ibrahim ‘Ibu’ Mohamed Solih stressed that the ruling party was “open to amendments from the opposition and ready to incorporate changes” to the General Goods and Services Tax (G-GST) bill and amendments to the Import-Export Act to excise and reduce import duties.

As of the 4:00pm deadline on Tuesday to submit amendments, Ibu Solih revealed that the MDP has proposed amendments requested by the Maldives Inland Revenue Authority (MIRA) and taken on board recommendations by the Maldives Association of Tourism Industry (MATI), Maldives Association of Construction Industry (MACI) as well as small businesses.

MDP has proposed completely excising import duties for fisheries and agriculture equipment and machinery, Ibu said, while maintaining current tariffs for imported fruits and vegetables to protect local farmers.

The proposed GST of five percent would meanwhile be reduced to 3.5 percent from October to December 2011, explained MP Abdul Raheem Abdulla, after which it would be raised to five percent next year.

Small businesses and “corner shops” would be exempt from the General GST, he added.

DRP Deputy Leader Ahmed Mohamed and MP Dr Abdulla Mausoom meanwhile told press yesterday that the party would oppose the introduction of a personal income tax.

“The main reason is that is going to be taken directly from the people,” said Ahmed Mohamed, former CEO of the State Trading Organisation (STO). “We will do everything we can to see that the bill does not get passed.”

As MDP currently has enough votes to pass the bill, he continued, the party would seek the support of other opposition MPs and Independents.

In addition, the main opposition party would attempt to delay the implementation of the tax bills to provide more time for both the public and businesses to adapt to the new system.

Moreover, the minority party would oppose an amendment to the Immigration Act, which would provide resident visas for skilled expatriate workers, as the party believes the move would make it harder for Maldivians to find employment.

DRP MP for Kelaa Dr Abdulla Mausoom told Minivan News earlier this week that the party would propose retaining import duties for “watermelons, papaya, bananas and mangoes to protect local farmers” to ensure price competitiveness for local agricultural produce.

“The rest is the way the MDP wanted,” he said. “With the numbers in parliament right now, MDP can pass bills the way they want.”

Following a meeting with President Mohamed Nasheed Saturday night, DRP Leader Ahmed Thasmeen Ali told press that the party “will not accept” proposed growth in state expenditure for 2012 and 2013 as “it would not be sustainable.”

Appearing on private broadcaster DhiTV the following night, Thasmeen said that state expenditure levels reaching over 60 percent of GDP was worrying.

“The figure has become so high because expenditure from the budget increased in response to special circumstances of the [December 2004] tsunami has been maintained at that level,” he explained.

While acknowledging that additional revenue was needed to finance the deficit accumulated since 2005, Thasmeen said that he objected to a proposed growth of about Rf1 billion in expenditure in 2013 since it was unclear how the increased spending would spur economic growth and improve productivity.

Responding to the minority leader’s statements, Ibu Solih said yesterday that increased expenditure was necessary to plug the inherit budget deficit and service high levels of public debt.

“13.9 percent of expenditure from the 2010 budget was for paying back loans,” Ibu noted. “There is no way we can escape that.”

The MDP MP for Hinnavaru asserted that the “answer to opposition concerns of how taxation proceeds would be utilised” was the fiscal responsibility bill proposed by the government, which would impose limits on spending and restrict annual growth of public debt to 3.5 percent per year.

Meanwhile at today’s sitting of parliament the committee report on the G-GST bill was presented to the floor, after which MPs were invited to submit amendments.

Some 39 amendments were submitted to the draft legislation while voting is due to take place when the sitting resumes at 10:00pm tonight.

Likes(0)Dislikes(0)

DRP MP proposes two-year lease extension for resorts under development

Amendments were proposed to the Tourism Act today to extend leases by two years to offer a “construction period” for tourist resorts, hotels and guest houses with stalled development.

Presenting the amendment bill to parliament, MP Mohamed Mujthaz of the opposition Dhivehi Rayyithunge Party (DRP) explained that the legislation would write-off unpaid fines from the new resorts as heavy fines were an impediment to financing the development or attracting foreign investors.

“Of the 84 islands leased for resort development, only 10 have been completed while 74 have not,” he said. “With the current prices in the construction industry, millions of dollars are needed to develop the most ordinary resort. Considering the 74 islands with stalled development, this is a large amount.”

He added that local banks did not have the capacity to finance the projects while international financial institutions were not “too supportive.”

If passed into law, the proposed amendments would also replace existing guidelines for calculating fines for non-payment of rent. Under the new rates, fines for non-payment of rent for one quarter would be set at five percent of the total rent; 12 percent for two quarters; 18 percent for three quarters; 25 percent for three quarters; and 50 percent for one year of unpaid rent.

Moreover, article 8(c) of the bill states that the government must not charge rent for the two-year construction period.

In the preliminary debate on the amendments, MP Riyaz Rasheed of minority opposition Dhivehi Qaumee Party (DQP) criticised the current government for “not paving the way to obtain loans” and leasing additional islands for development.

DRP MP Yousuf Naeem however noted that the amendments had “serious problems.”

Naeem – affiliated with the Z-faction of the DRP – claimed that similar amendments previously passed to extend resort leases to 50 years “is now in the process of being abolished by the Supreme Court.”

“The reason is because some honourable MPs voted for it in violation of clause 158(a) of parliamentary rules of procedure,” he explained, referring to a conflict of interest on the part of resort owners in parliament.

The MP for Felidhoo noted that as some resort development projects had been stalled for six or seven years, he did not support a further extension of two years with suspended rent.

“These islands were leased after competitive bidding processes with many parties,” he said, adding that it would be disrespectful towards the rights of losing bidders if the government were to write-off debts or unpaid fines.

“The government is owed US$154 million in fines alone, not to speak of rents,” he continued.

MP Mohamed Riyaz of the ruling Maldivian Democratic Party (MDP) concurred with Naeem and questioned whether a two-year extension would allow the resorts to become operational.

MDP Hamid Abdul Gafoor noted that the state was owed US$320 million as unpaid rent and fines, which was “not a small amount” to be written off.

DRP MP Dr Abdulla Mausoom however argued that parliament was forced to “enter micro-governance” as a result of the current administration’s “insincerity” and “disregard of the law and doing things in the margins.”

The proposed law would ensure that the government could not impose double standards on tourist businesses, Mausoom said.

Likes(0)Dislikes(0)

UNDP awards US$79,862 to local CSOs in small grants program

The United Nations Development Program has awarded US$79, 862.95 to the 13 winners of the “Support to Civil Society Development” program in the Maldives.

The winning projects, supported by the Small Grants Facility and jointly funded by the UNDP and Australia Agency for International Development (AusAID), were designed by local CSOs and selected out of 54 proposed projects.

United Nations Resident Representative, Andrew Cox, spoke at the UN building today. Cox called civil society a “pillar of democracy”, and a significant factor in democratizing the Maldives. He commented on the large scale changes the country has faced in recent years, and called the Maldives “a country which shows much scope for growth and maturity.

This is the second round of projects in the program. Monitors of the first round had determined that the program was constructive, Cox said.

“Initiatives such as the Monitoring of Political Violence in the First Local Council Elections project, The Empowerment of Women project and The Right to Empower project – among the 09 projects funded in the first round, have indicated steps taken in the right direction by the civil society,” he said.

The second round of projects were selected from 11 atolls, including Raa, Baa, Noonu, Addu City, Malé City, and others. Almost every atoll in the country is represented in the selection.

Among the areas the program intends to address are human rights, governance, gender equality, and youth development. Cox added that the tenets of democracy, such as transparency, accountability, and the voice of the people will be empowered.

Cox backed the program by invoking the Maldives government’s Strategic Action Plan, “which guarantees that space will be allowed for individual freedoms and the civil society to thrive.”

In closing, Cox reminded his audience that significant challenges to establishing a full  democracy remain in the Maldives, but that they can only be overcome by the united efforts of the people. Cox reinforced the UN’s committment to supporting the Maldivian people in their pursuit of a consolidated democratic identity.

Likes(0)Dislikes(0)

Government seeks bipartisan support for economic reform package

President Mohamed Nasheed has signaled the government’s willingness to address opposition concerns and incorporate changes to the proposed economic reform bills currently before parliament.

Speaking to press following an official meeting with main opposition Dhivehi Rayyithunge Party (DRP) Leader Ahmed Thasmeen Ali at the President’s Office last night, Nasheed said that the government would consider DRP proposals after “discussions at a technical level.”

“Our wish is to find a way to enter into detailed discussions with the DRP,” he said. “I asked Thasmeen about it and he said they will give an answer after consultation with their party.”

He added that broad consensus and bipartisan support was very important before putting a taxation system in place: “In my view, all citizens and politicians in the country understand very clearly that establishing a taxation system is not going to benefit a particular government,” he said.

President Nasheed noted that the government had consulted the tourism industry and received support for the proposed reforms.

Thasmeen meanwhile told press outside the President’s Office that he conveyed concerns about the proposed growth in expenditure over the next two years as well as the impact of the personal income tax.

“We cannot accept government expenditure exceeding the current Rf13 billion [annual state budget] after levying new taxes,” he said.

The minority leader of parliament said that the party was “especially concerned” about the income tax as “all citizens would be affected.”

Speaking to Minivan News today, DRP MP Dr Abdulla Mausoom confirmed that “a technical team” from the party will engage with the government to discuss details of the concerns expressed by Thasmeen at last night’s meeting.

“We have a parliamentary group meeting tonight to discuss what the DRP is going to propose,” he said.

The “prime focus” at the moment was the two bills completed by committee, said Mausoom, which were bills on the General Goods and Services Tax and an amendment to the Import-Export Act to excise and reduce import duties.

While final amendments to the bills are due before Tuesday, Mausoom said that the DRP would propose maintaining import duties for “watermelons, papaya, bananas and mangoes to protect local farmers” and ensure price competitiveness for local agricultural produce.

“The rest is the way the MDP wanted,” he said. “With the numbers in parliament right now, MDP can pass bills the way they want.”

President Nasheed meanwhile told press last night that Thasmeen gave assurances that he would “not play any part in bringing Majlis to a halt.”

“As you know, the government has support enough to pass the bills,” he said. “But that would not be best for both the government and the people for such a major change.”

Nasheed stressed that a comprehensive package was proposed to ensure that the new taxation system would be “well-rounded and water-tight.”

Concluding the press conference, President Nasheed praised Thasmeen for showing the “necessary principles of a statesmen.”

Likes(0)Dislikes(0)