The government today signed a 25 year lease agreement with the GMR-Malaysia Airport Holdings consortium to develop and manage Male’ International Airport, hours after parliament voted in favour of a bill requiring parliamentary approval of lease transactions with overseas parties.
Chairman of the Privatisation Committee, Mahmoud Razee, claimed parliament’s decision today would not impact the signing “as it yet to be ratified by the president.”
The signing ceremony was scheduled for yesterday but was derailed at the eleventh hour after reported disagreements between board members of the Maldives Airport Company Limited (MACL), the organisation which currently manages the airport.
Minivan News understands the four MACL board positions were reshuffled by the government last night in an effort to proceed with the signing today, although this has yet to be officially confirmed – new chairman Ibrahim Saleem, also Chairman of the Maldives Tourism Development Corporation (MTDC), signed the contract today in place of former chairman Ibrahim Nooradeen.
An official of the President’s Office observed to Minivan News that as the MACL is a public company with 100 percent of its shares owned by the government, “it is the duty of the board to act in the interests of the major shareholder.”
Minivan News is currently seeking comment from the board members.
Under the new agreement, the consortium will establish a new local company to manage the airport which will be operated by Malaysia Airlines Holdings. The Maldives National Defence Force (MNDF) will remain in charge of security, and immigration will remain under government control. A briefing document obtained by Minivan News also indicates that the agreement comes with a clause that no staff can be made redundant for two years unless for “disciplinary or performance related reasons.”
The deal has proved controversial with four opposition parties signing a statement on Saturday evening condemning the decision on nationalistic grounds, arguing that handing management of the airport to a foreign company compromised the sovereignty of the Maldives.
Deputy Leader of the main opposition Dhivehi Rayyithunge Party (DRP), Ibrahim Shareef, said last week that the DRP would not honour “shady deals of this type” if it came to power in the next election, unless they were approved by parliament, while today another of the party’s deputy leaders, Umar Naseer, said the deal was “ridiculous” and would result in the dismissal of half the airport’s 3000 staff.
Speaking briefly to the media following the signing, Managing Director of GMR Infrastructure Sri Pathi hinted acknowledgement of the controversy, stating that “airports always belong to the people – never to us.”
“Please don’t think we came here to take over the airport,” he said. “We perhaps become the trustees – but emotionally in terms of ownership it belongs to the people. We are of course here to invest our money and make a business deal on the best terms possible – but the airport still belongs to the people. We make a commitment that we will operate the airport to the best international standards that we can, and prove to you that the trust you place in us will never be betrayed.”
Managing Director of Malaysia Airports Holdings, Basheer Ahmed, noted that the majority Malaysian-government owned company managed 39 airports in Malaysia and several overseas, including airports in Hyderbad and Delhi.
“Every country needs an excellent airport because it is the visitor’s first impression,” he said.
The briefing document obtained by Minivan News contains forecasts of the government’s expected earnings (reportedly provided by GMR) from the airport over the lifespan of the contract. It reveals that a majority of the predicted revenue, a major factor in calculating the NPV (net present value) used to determine the successful bid, derives from the 27 percent fuel revenue share once the airport is completed in 2014:
2015-2020: 12.8m gross + 74.25m fuel = US$87.05m per year
2020-2025- 17.02m gross + 90.99m fuel = US$108.01m per year
2025-2035 – 20.43 gross + 108.27m fuel = US$128.7 m per year
The document contrasted this with the dividends paid to the government by MACL over the last three years, noting that the majority of the dividends paid in 2008-2009 were achieved “by taking a loan.”
2007 – 2.3 million
2008 – 13.3 million
2009 – 5.05 million
On the suggestion that MACL should be allowed to raise finance and invest in the upgrade itself, a predicted US$300-400 million, the document noted that MACL “already has debts of Rf 600 million (US$46.69 million)” and would be unable to obtain further leverage “without a sovereign guarantee – simply not allowed due to the IMF measures.”
The airport was signed to GMR-MAH late this afternoon.
Meanwhile, daily newspaper Haveeru featured an interview with the Turkish-French consortium TAV-ADPM, who have reportedly expressed dissatisfaction of the bid evaluation process “and urged for a re-evaluation of the bids.”
“The newspapers started reporting that GMR won the bid even though we were not told the party who won the bid. We faced many problems, since the two companies in our consortium are also listed in stock exchange,” Haveerru reported head of the consortium, Gusiloo Betkin, as saying. “It cannot be said that a certain party won the bid without signing the concession agreement.”
Betkin expressed disbelief to Haveeru that the GMR-MAH bid could offer the government 27 percent of fuel trade “without facing any loss. We are a party that provides services to 170 million passengers annually in 39 airports. We also have experience in fuel trade,” Betkin told the newspaper.
TAV-ADPM had offered 16.5 percent of fuel trade to the government, he noted, the highest deemed feasible, and that at 27 percent, flight arrivals to the Maldives would be affected by rising fuel prices.
“The main thing is the fuel. If the fuel prices are high, no one will take in fuel from there – Maldives will lose that income. The airlines will also focus to other destinations,” Betkin told Haveeru.
Deputy Leader of the Maldives’ main opposition Dhivehi Rayyithunge Party (DRP), Umar Naseer, has said that the government’s decision to privatise Male’ International Airport is “ridiculous.”
”Privatisation is a good policy, but there should be limitations,” Umar said. ”There are many disadvantages that Maldivians will face in the long term future if Male’ International Airport is privatised.”
He claimed that if the airport was privatised, the Maldives would not have the authority to decide which flights would be permitted to land at the airport.
”That means, if [the operators] allowed it, an Israel flight can come and stop over after bombing Arab countries,” Umar claimed.
He also claimed that “more than 1500 jobs” would be lost.
”More than half the Maldivians working in the Airport will lose their jobs if a foreign company takes over it,” Umar predicted. ”There are currently more than 3000 Maldivians working there.”
He said that if foreigners replaced Maldivians working in the airport, “income which was earned by the Maldives would go to the hands of foreigners.”
”Retail shops in the airport will also belong to foreigners,” he said. ”So money coming into the county will flow out of the country because foreigners are earning it.”
Umar suggested that the airport could charge a US$25 airport development fee for each passenger, the same amount GMR has proposed to collect.
”If that US$25 charge is implemented it will generate an extra US$25 million annually, because more than 500,000 tourists come to the Maldives each year and could be charged upon arrival and departure – which means US$50 from each person could be collected.”
He claimed the government was pushing ahead with the privatisation deal because “there are no successful businessmen in the government.”
”President Nasheed did not even know how to run a carpentry business. In 1990 his father gave him the business, and the president bankrupted it,” Umar alleged.
He said that “any economist” would consider the privatisation deal “ridiculous”.
Today the parliament is voting on whether to amend a Financial Bill stating that any state asset can only be sold or rented by an imposed law approved by parliament.
The signing of the privatisation deal with GMR-KLIA was derailed at the last minute yesterday, in front of assembled press, when representatives of the Maldives Airports Company Limited (MACL) reportedly disagreed over who would sign the document.
Three MACL board members have now reportedly resigned after disputing the government’s decision to privatise the airport.
Press Secretary for the President, Mohamed Zuhair, said he had not officially received confirmation.
”I also heard something like that unofficially,” he said. ”I have asked for the minutes of the last MACL board meeting.”
Minister for Civil Aviation Mahmood Razee, also Chairman of the Privatisation Committee, said he had no information regarding the matter.
”All the board members agreed to privatise the airport,” said Razee. ”If they are having disputes, that might be an issue concerning individuals.”
MACL board members Shaz Waleed, Moosa Solih, and Chairperson Ibrahim Nooradeen, declined to comment.
The vote on the Financial Bill will go before parliament today.
An aviation expert unconnected with the government or bidding process, and with extensive experience of Male’ International Airport, has told Minivan News on condition of anonymity that the state of arguably the country’s most critical piece of economic infrastructure “is far worse than most people realise” and in “urgent need of major investment”.
“The runway hasn’t been resurfaced for 18 years, and it still has cracks and depressions caused by the 2004 tsunami,” he explained.
“Even now there are spots which need to be cut out and resurfaced,” he said, naming several international carriers that had privately expressed concern to the authorities about minor damage caused to their planes by the state of the runway.
Furthermore, the airport does not meet NX14 standards of the International Civil Aviation Organisation (ICAO) because of the proximity of buildings to the runway, the source said.
“The last time ICAO did audits they were not satisfied. If the airport is not upgraded, the worse case scenario is that ICAO will blacklist the airport – and that means nobody will land here. I’m not scaremongering, but the airport needs major investment,” he said.
“I don’t think the politicians understand the situation,” he explained. “The runway needs urgent repair and maintenance, and aircraft from places like Germany – that have travelled over 10 hours with 300 passengers on board – are being held above the airport for 14-20 minutes waiting for a parking space. This is especially a problem during the European winter (peak arrivals).”
Private jets were occasionally being diverted to airports such as Trivandrum and Colombo because of a lack of parking space, denying the government a stream of income, he added – “and there’s no standard of parking, it’s like a haystack.”
The “geometry and design of the airport” were fundamental limitations of the current layout, he noted, but both the current and previous governments were financially unable to invest the significant amount of money required to repair and upgrade the facility.
“In 2006 the former government contracted UK company Scott Wilson to draw up a masterplan, with three options costing US$300 million. The government could not find the funding to go ahead with it,” he said.
“We’re at a crossroads – either it gets privatised now, or it never does. It needs urgent and necessary expansion, and the runway needs to be repaired,” the source explained.
“If people do not agree with the airport being privatised like this, they should come to the bargaining table with something better – there are many multi-millionaires in Male’ who could co-operate on this,” he said.
“It’s not about airport revenue – plenty of countries privatise their airports. But in the Maldives the whole economy is completely dependent on incoming tourists, and most of the [financial] benefits are downstream [at resorts]. At the end of the day the country benefits by having a good airport.”
Not in national interest: opposition
Yesterday evening a coalition of opposition parties, including the Dhivehi Rayyithunge Party DRP), the People’s Alliance (PA), the Dhivehi Qaumee Party (DQP) and the Jumhooree Party (JP), accused the government of acting outside the national interest over the privatisation of Male’ International Airport, and signed an agreement to try and halt the process “inside or outside parliament” after the government accepted a bid from GMR-KLIA.
This afternoon a planned signing ceremony at the President’s Office in front of assembled media was first postponed and then reschedued for Wednesday, with Chairman of the Privatisation Committee Mahmood Razee claiming that the “documents were still pending.”
Daily newspaper Haveeru reported that the signing was cancelled because of disputes among board members of the incumbent airport operator, Maldives Airports Company Limited (MACL), over who would sign the document.
The GMR-KLIA bid accepted by the government will involve an upfront payment of US$78 million and one percent of the airport’s profit until 2014, increasing to 10 percent from 2015 to 2035. GMR will also pay 15 percent of fuel trade revenues to the government in the first four years, and 27 percent from 2015 to 2035.
The two other bids – from Turkish TAV Airports Holdings Company/French Airports De Paris and Swiss Flughafen Zurich AG/GVK Airport Developers – involved substantially less upfront sums but 2-3 times the profit sharing over the life of the agreement.
The statement signed by the oppositition parties condemning the government’s decision to give the airport’s management in control of a foreign company, said the decision was “not made with the intention of benefiting the country’s economy” and that they would seek legal advice.
“[The airport] is one of the most valuable assets of the Maldives and it has a direct link to the independence of the state,” the statement said.
Last week DRP Deputy Leader Ibrahim Shareef accused the government of pushing the privatisation deal through without seeking approval from parliament, and said the DRP “will not honour this type of shady deal” if returned to power in 2013.
Razee meanwhile hit back at the opposition’s unspecified allegations of corruption, explaining that the World Bank’s International Finance Corporation (IFC) had been involved in the privatisation process as a transaction advisor since July 2009, “and would certainly not stand by if conduct was improper.”
“We started this process in December 2008. It was not something we thought up yesterday,” Razee said.
IFC representatives said they would not comment on the matter.
Vice President and Spokesman for the opposition Dhivehi Rayyithunge Party (DRP) Ibrahim Shareef has said the DRP will not honour “shady deals made according to vested interests” if the party comes to power in 2013, referring to the government’s privatising of the country’s airports.
The government has shortlisted three parties to run Male’ International airport and will select one over the next 3-4 days.
The parties include Aéroports de Paris Management Company of France (ADP) and Turkish company TAV Airports Holding Company, Indian company GVK Airport Developers in partnership with Swiss Flughafen Zurich AG, and GMR-KLIA.
Shareef expressed concern that the government’s efforts to privatise state assets, such as the airport, were not occurring with parliament approval.
“Parliament is in the process of amending a public finance bill that will stipulate the government has to put these decisions before parliament,” he said.
“If the governing party will not accept this, then the new [DRP] government will not honour this type of shady deal. We will not honour shady deals – only lawful deals according to parliament.”
Shareef said the airport was currently “making the government money”, and the asking price it had set “is so low. [The deal] is riddled with corruption,” he alleged. “If the government has nothing to hide, it has nothing to lose from asking parliament.”
Minister for Civil Aviation and Chairman of the Privatisation Committee Mahmoud Razee told Minivan News that “as far as I understand we are proceeding according to the public finance act which is currently in force. Parliament legislates but actual delivery is up to the executive.”
It is the opposition’s “prerogative to say what they wish, but the reason why experienced and reliable companies are involved in this bid is because they believe that this is a viable project.”
The Male’ airport privatisation deal would be for 25 years, extendable by another 10 years, and would require a minimum level of investment towards upgrading the airport in the first three years to meet a certain level of service.
“A certain percentage of the service charge will to go to the government, and in addition [the operator] will also prescribe a percentage of the revenue,” Razee said.
Within three years, the government would expect a new terminal on the eastern side of the airport islands, up to international standards, and the completion of aero bridges (passenger walkways), effectively doubling the annual capacity of the airport from 1.6 million passengers to 3 million passengers.
The intention was to enable fast growth of the country’s tourism market, he explained.
“It’s bound to grow – particularly the Chinese and Indian markets,” Razee said. “We’ve already received applications from Air Asia and several Chinese carriers.”
Meanwhile, the government yesterday signed an agreement with Dubai-based company Supreme Fuel Trading to manage Gan airport for 30 years, in an agreement intended to hasten development of the southern region of the Maldives by allowing 747 class aircraft to land.
“At the moment the largest aircraft that can land [in Gan] is the 767 and the Dash 100-200,” Razee said.
The government has also received a proposal from GMR to upgrade Hanimadhoo airport and increase tourist traffic to the northern atolls.
For a country dependent on international tourist arrivals, the airports are the ventricles of the Maldives economy. Addressing concerns that privatising them would loosen the government’s control over these critical assets, Razee observed that all the interested parties being considered “have experience running many international airports”.
“Security will continue to be overseen by the Maldives National Defence Force (MNDF), and the airport will be certified by civil aviation authorities irrespective of who is running the airport,” he explained.
Tourism in the Maldives is showing signs of steady growth, with an increase of 20 percent in the first five months of 2010 compared to last year.
Arrivals for first five months of this year were seven percent higher than for the same period during the boom year of 2008.
Meanwhile, the 91 resorts in country had a steady occupancy rate of 82.3 percent.
The International Monetary Fund’s (IMF) Country Report for the Maldives, published earlier this month, pegs the country’s fiscal deficit in 2009 at 26.25 percent and notes that while the “political climate for public expenditure cuts remains difficult… the coming months will be a crucial test of [the government’s] ability to prevail.”
The report provides a neutral assessment of the country’s economic condition and its progress towards economic reform and reduction of its significant budget deficit.
It notes that the authorities “have taken remarkable steps to bring about the very large fiscal adjustment”, most explicitly, salary cuts to government employees of between 10-20 percent, “something seen in just a handful of countries worldwide”, alongside “a 40-60 percent increase in electricity tariffs.”
The IMF also lauded the governments “initiation of a program for public employment reform that will ultimately reduce the government’s payroll by one-third”.
The government was facing “intense political pressure”, the IMF report observed, after being compelled by the Civil Service Commission (CSC) to restore salaries backdated to January 1.
“The government has so far paid wages at the reduced levels, including for the police and army, who are not governed by the CSC,” the report said, adding that the decision had been “publicly challenged by the government on legal and economic grounds.”
A final court resolution on the law suit filed by the CSC could take up to one year, the report noted.
Meanwhile, parliament passed the 2010 budget “with amendments totaling a seven percent (4.25 percent of GDP) increase over the government’s proposed budget.”
As a consequence, the report stated, “the annual deficit targets for 2010 and 2011 will be missed on current policies.”
Therefore, it stated, a “key risk” to the country’s economy “concerns the ability of the government to maintain the public sector wage cuts. A negative outcome on this would have a large fiscal impact,” the report said, adding that government’s target for public sector employment cuts had already been pushed back a year from the end of 2010 to the end of 2011.
Secondary risks to the economy included delays in passing taxation reforms through parliament, and “planned public employment cuts.” Tourism was “bouncing back”, it noted, but whether this would affect the recovery of the domestic economy was “highly uncertain”.
Therefore, the government’s capacity to withstand political pressure on the issue of cuts would decide the country’s fiscal recovery “in the near term”, the IMF suggested.
The report was critical of the government’s decision to acquiesce to parliament’s recommendation to restore the wages of independent commissions in January this year, and its commitment to pay civil servant pension contributions from May 2010 until wages were restored to September 2009 levels.
The IMF report acknowledged that “direct redundancies were proving difficult”, however “the transfer of employees to the private sector (which accounts for about two fifths of the planned payroll cuts) has taken place in line with projections.”
Nonetheless, the IMF calculated that if the government continued to pursue economic reform at current pace and policy, the country’s fiscal deficit would increase by one percent of GDP in 2010 and 4.5 percent of GDP in 2011.
Andrew Cox is the newly-appointed UN Resident Coordinator and UNDP Resident Representative for the Maldives. Before arriving in the Maldives, Cox was based in New York as the Chief of Staff for the Office for the Coordination of Humanitarian Affairs in New York.
Prior to this he held several positions in Sudan where he worked on comprehensive peace agreements between warring factions, and in Afghanistan. Before his UN career Cox worked as Field Director for Concern Universal in Sierra Leone and had assignments with various companies and NGOs in the UK, Democratic Republic of Congo and Côte d’Ivoire.
JJ Robinson: How does your experience in development and within the UN system benefit your new role in the Maldives?
Andrew Cox: I’ve worked for the UN since 1999 and NGOs before that. I come from a development background, but I just seem to have ended up in a lot of conflict, post-conflict and post disaster-places.
During my three years in Sudan I spent a lot of time working on a comprehensive peace agreement, and I spent time in Afghanistan in 2002 just as the situation there was changing – I was very sorry to leave, actually. I have also spent some working in Sierra Leone, which oscillated between conflict and post-conflict.
I think the process of transition in [such places] is very interesting – it’s about how people behave when their basic assumptions are changing and the bedrock is shifting under them. People act in extreme ways and sometimes it’s very difficult to get institutions in these countries to change.
What is especially difficult [about countries in transition] is the need for urgency. You don’t have luxury of 10 years to see if something might work. You just have to try things at high speed and discard them if they don’t.
One of the interesting things about coming to Maldives is that I find this transition happening. There is a tremendous amount of dialogue, although sometimes a little above the level of dialogue in terms of intensity and rhetoric.
What the Maldives is going through is not unusual and is to be expected in such circumstances. What I hope I can bring from my past is help and advice, and assistance from the UN system in managing this transition.
JJ: The Maldives has made a major transition to democracy, and the next major transition is the transition from less developed country (LDC) status to middle income. What does this mean and what are the key challenges for the country?
AC: On the surface there are some things the Maldives will lose along with its LDC status, such as access to concessional credit, which is probably one of the more important things. It will also lose a certain amount of grant income from donors.
But the point is to look at it as an opportunity; OK it may hurt in certain areas at the beginning, but in the end the Maldives has got itself where it needs to be and now has more to offer the world than it might have had before – it’s not just about offering beaches to tourists coming in.
When I saw the President I asked him if he had thought about having the Maldivian National Defence Force (MNDF) serve in UN peacekeeping operations – it’s one way in which Maldivian experience can be sent out there to benefit the rest of the world, and of course it’s a learning experience for those who participate.
Similarly, the Maldives was a victim of a major natural disaster in the tsunami, and in my view it would make a lot of sense for the country to join the UN Disaster Assessment and Coordination (UNDAC), which sends in disaster coordination experts to a country whenever there a natural disaster. The Maldives should be able to contribute to that.
I also think, and the President said this and I fully agree with him, that the Maldives should not be about dependency on aid. It should be about development, trade, and punching greater and greater weight in the region.
What everyone seems to be doing at the moment is focusing on the future. The loss of income from donors, if things go well, will be replaced by greater trade and economic growth. But there are some structural issues making that difficult, no doubt about it.
JJ: What kind of structural issues?
AC: The budget deficit is the major one. I’m not completely up-to-date with the figures, but last time I looked it the deficit was 33 percent of GDP, which everyone – the government as well as international institutions – has said the Maldives has got to address.
The deficit in Greece is 12 percent of GDP. Obviously Greece is a very different place [to the Maldives], but everybody needs to be serious about the problem. It’s a huge challenge and until it is solved it is going to be difficult to change other things.
The UN’s position is to help the government find ways dealing with this. There’s various things you can do but in the end the gap between income and expenditure has to change, because it is simply not sustainable at the moment.
JJ: How does the UN navigate the polarised politics here? How do you find the middle-path and involve the opposition?
AC: There have been many changes here over the last few years, and the UN has been here throughout that entire period. I think we played quite a positive role – although you can’t get everything right. But by sticking to its principles, the UN tries navigate its way through. For example, during the change to democracy the UN worked closely with then-president and his party, as well as the opposition.
What we tried to do was help them manage the process [of transition]. It’s very clear what the UN stands for – our principles are out there. There’s no hidden agenda and the approach is consistent across the UN. There are many different levels of support the UN can bring.
I’m not trying to be naive or idealistic – but it’s [an approach] that works just as well if you’re dealing with rebels in the middle of a conflict or if you’re dealing with development challenges – you help those who are there to make the right choices, and sometimes provide an enabling environment for that to happen.
The UN is also here to try and improve the lot of ordinary Maldivians. One of our principles is that we work with all parts of society and we do that in an open way, and that can sometimes be difficult to explain. But in the end it is our job to work with everybody who can be a positive force for change, and to try and advise those who are less convinced for the need to change to change their approach. That’s consistent across all the countries we work in.
JJ: What are some of your experiences from the programs you have worked on in the past that you think would also work in the Maldives?
AC: I worked on the last stages of the comprehensive peace agreement in Sudan, which is a mostly Muslim country. The key in Sudan was doing everything you could to get the parties to sit together. Obviously we don’t have the same kind of situation in the Maldives, but the principles are still the same.
A facilitating role sounds a little bit ‘wishy washy’, until you realise what happens when you don’t have that. It doesn’t have to be the UN – in Darfur the African Union had the lead on the political side, and the UN helped them to do their job.
As a newcomer to the Maldives, it is very obvious that there is a certain amount of heat in the political discourse, to say the least. A lot of this is a very natural outcome of the change everyone has gone through. I think the trick is to find areas where there can be cooperation, and not to allow bigger disagreements to pollute the water where consensus might be possible.
For example, I think the cross-party effort to deal with domestic violence is very interesting right now. Everyone agrees domestic violence is a problem, and although there may be disagreement over how that problem should be addressed, this is absolutely one of those areas for mature political dialogue. We will try and help that process along, but it needs to be the parties in parliament to figure out how they want to deal with domestic violence issues.
Civil society is weak in the Maldives, explains Cox
JJ: To what extent should be UN be a leader of civil society in a country, in terms of supporting NGOs and helping them work properly and efficiently?
AC: I don’t think leader is the right word. If we were, then if we withdrew our support the whole thing would collapse and that’s not the way it should be. The real strength of civil society in most countries, to use an overused phrase, is ‘grassroots.’
Civil society is only powerful if it comes into being organically. I think most people on either side of the political divide recognise that civil society is very weak in the Maldives, and that much more needs to be done to support its growth.
I think the UN can play a major enabling role. There are an awful lot of people around the world who have [grown civil society], and one thing we can do is to bring some of them in to explain how they did it. That process of sharing information and knowledge is very important.
JJ: What do you mean when you say civil society is weak in the Maldives? There are a great many NGOs and it does seem to be a sought-after profession.
AC: Yes exactly – I think across all parts of society, and obviously it varies area to area, from human rights to gender to drug prevention, there are a number of things you look for, such as sustainability of funding and resources. In the end civil society will only be strong if Maldivians embrace their own civil society and start paying for it.
Some of that is about government funding, but much more of it is local philanthropy and gift giving – and earning the organisation that you’re associated with.
The UN can give out a grant of US$20,000 [to an NGO], and what they’ll do is buy a computer, pay for some travel and training and so on, then it’s gone and that’s it. What happens then?
This is a very important question that a lot of civil society organisation managers are thinking about – or at least I hope they are. Because in the end, international funding can’t be assured for anybody over time.
I think the whole point is to use that external support as a way to building up a civil society organisation so it can have links with the community and an income stream, and a sufficiently strong volunteer network to get done what they think needs to get done.
How do we help them through that process? Definitely we have supported NGOs in the past, and there has been a proliferation in the last year or two, but now they need to move beyond that start up phase and become a bit more secure. You really need a strong civil society because it gives you a way to get important things done that is separated from politics.
JJ: The Maldives recently beat Iran to the UN Human Rights Council – what kind of an achievement does that represent?
AC: I think it’s a remarkable achievement. The Maldives ran a good election campaign on its own merit and got the support, which was a very big deal.
The Human Rights Council is in organisation in flux, and I think both [UN Secretary General] Ban Ki Moon and the High Commissioner of Human Rights [Navi Pillay] see it as a long term project – and many of its members see it in the same way.
For the Maldives it represents a tremendous opportunity to demonstrate it can be a world leader, as it already is in the area of climate change. For a country to progress so far on the human rights side allows it to go out there with a very honest position and say ‘we’re not perfect yet, but this is what we’ve done.’
Another part of the Human Rights Council is that you have support from your peers to deal with human rights issues, so when it works well is when there is an atmosphere of cooperation and people get down to business away from the heated rhetoric you also sometimes hear on human rights issues.
But I would also say that because the Maldives has a somewhat exalted position on this council, this is also a challenge. The Maldives can’t stop its progress on human rights, because the eyes of the world are on the Maldives as much as eyes of the Maldives are on the world in the human rights sense. I think it is very important that this election provokes a renewed investment in human rights in the Maldives, and if it doesn’t happen then the Maldives’ position on the Human Rights Council could invite unwelcome attention.
It just the way we seen these things work over the years. I sincerely hope – and everything I’ve heard suggests this will continue to happen – that the Maldives will continue to strengthen human rights in the country, especially now.
JJ: How would you describe the level of human rights in the Maldives, from the perspective of a newcomer?
AC: I would probably describe it again as a situation of change. There have been tremendous advances made, but obvious areas that need strengthening – areas like access to justice.
I think there are important bills pending on the judiciary, things like access to legal aid. The Maldives needs to invest in the judiciary and its ability to do its work, and there needs to be investment in corrections – I think the problems are self-evident. Then there’s right to information, and of course the police, who now have themselves been changing and adapting to new challenges. I think there’s a raft of institutional legal framework measures that are needed to strengthen human rights in the Maldives.
I think the Human Rights Commission of the Maldives (HRCM) needs to continue to be supported, for obvious reasons. It’s important to have a strong home-grown human rights commission to encourage the government to take the steps it needs to take, and I think it is absolutely important to have strong human rights organisations on the civil society side. This is a priority for UNDP, and we’ll be scaling up our support to human rights NGOs. If you get them right, there’s a knock on effect to other NGOs.
JJ: Human rights issues such as freedom of expression and gender equality appear to sometimes conflict with stricter interpretations of Islam. Is it possible for human rights to be fully realised in a 100% Islamic country?
AC: I think there is a very strong human rights tradition in Islam, and I think it’s absolutely possible. I know there are many different legal systems under the Islamic system, and what I think is quite important is to learn from other experiences around the world and shamelessly steal the best parts. I see absolutely no contradiction between Islam and human rights.
JJ: The Maldives has established itself as an international leader on climate change based on its vulnerability to rising sea levels, but at the same time it’s trying to attract long term business investment. Is there room for these to exist side by side?
AC: I think it’s an interesting dilemma, and if it’s going to get solved anywhere it be here. Obviously I’m not a climate change scientist, but speaking as the manager of UNDP I think there’s interesting opportunities in the Maldives over how to cope with climate change.
We still don’t know how bad it’s going be, so yes, risk inherent in every situation. But let’s not forget that the Maldives is not alone in this – the Maldives may have problem with rising sea levels, but there are many other countries with problems related to climate change – you just have to look at sub-Saharan Africa, and see how climate change is affecting water and food production there.
Certainly from the Maldives side, the country has to press on with mitigation and creating a low-carbon economy. There are thousands of different possibilities, and money to be made off successful models of technology that can be proven to reduce carbon. On the adaptation side there’s a lot we don’t know how about how reefs will react to changing water temperatures, and new technologies which can be looked at in terms of sea defenses. And things like if you’ve mangroves that you look after, you got a much greater change of withstanding rising sea levels and weather events than if you don’t have them. It’s a matter looking at these things and the impact of communities that live in these areas.
With all that in mind, the Maldives is a good place to invest in from the point of view of climate change-related industries. Businessmen and women are not stupid – they evaluate situations and make decisions accordingly. One of the things the government has committed to is loosening the trade environment and having clear regulatory frameworks, and I suspect if they successful pushing that through then that will also encourage investment.
So don’t think the two messages are contradictory. You have to do an awful lot because of climate change, but you can continue to build the economy as well.
I think adaptation is also very important – people need to be able to manage risk more than they can at the moment. Generally speaking we estimate that for every dollar spent on disaster risk mitigation you save $10 in losses when a natural disaster strikes – the economics are quite obvious.
We have quite some interest in the Maldives’ obvious vulnerabilities to climate change and major weather events, and it’s useful to use different communities around the Maldives to test ways of strengthening people’s ability to withstand natural disasters. If we get that right, then that is also something the Maldives can export – knowledge and know-how about how to deal with vulnerability in the face of climate change.
What we are going to be doing over the next year or two is looking along with the government at creating a global climate change centre in the Maldives. We are working on the details at the moment.
Another priority area is to look at governance programs and see how we can help. A major step forward of the last few months was the government getting together its strategic action plan – it’s a great document but it’s very thick, and it’s not much use unless it gets implemented. We all feel it is quite important to have a results framework, and if the government is able to do that, Maldives stock will go up in eyes of donors.
President Mohamed Nasheed addressed the 6th World Islamic Economic Forum in Kuala Lumpur yesterday, outlining the links between Islam and trade and expressing hope that the forum, and commerce between Muslim countries, will grow in the future.
The forum, which was held from 18-20 of May, was a platform for governments of Muslim and non-Muslim nations, and business leaders, to meet and discuss trade and economic issues.
This year’s theme, Gearing for Economic Resurgence, focused on the role of Islamic banking and financing, and how it can play a role in building a more stable global finance system.
Speaking at the forum, President Nasheed said he believed it was “appropriate that modern day Muslim nations meet to trade and invest with one another.”
He added it was important to “forge ties with nations of other faiths, just as Muslims have done over thousands of years.”
Nasheed noted that “it was through trade and commerce that Islam was introduced to many parts of the world.”
The spice trade brought Islam to Central and South East Asia, China, and Sub-Saharan Africa, he continued, and it was trade that brought Islam to the “then Buddhist Maldives.”
Arab merchants were attracted to the Maldives in the 12th century when they found out about the “abundant supply of Cowry shells…[which] were used at the time as an international currency. “
Because of the islands’ geographic location, said Nasheed, many merchants also stopped in the Maldives during their travels from the Spice Islands to the Middle East, and waited for the monsoon.
President Nasheed noted that the famous 14th century explorer, Ibn Battuta, also came to the Maldives during his travels and was “impressed by combs made from turtle shell, as well as rope and fibres, which were exported abroad.”
Nasheed reiterated that Islam and trade have always been closely tied, as “in the past, trade brought Islam, and Islam brought greater trade. To my mind, Islam and commerce are synonymous.”
Moreover, he said, “Muslim people have a strong culture of commerce” and the Qur’an was “explicit about correct terms of trade and commerce.”
President Nasheed said although “some people belittle Muslims and Islam—they like to portray Muslims as backward and impoverished people,” he believes “the signs of growing Muslim prosperity are everywhere: from the glittering desert cities of the Arabian peninsula, to the vibrant export economies of Malaysia and Indonesia.”
He added that, “as Muslims, we can be confident in trading and investing with one another.”
Open economy
Although the Maldives’ economy was once “relatively closed”, the president told the delegates, the current administration had “introduced a radical programme of privatisation and public-private partnerships.”
“We believe that the free market is the most efficient and effective mechanism to deliver goods and services,” he said. “We are offering investment opportunities across the board: from housing to hotels; from energy to education.”
The president said historically Maldives “exported cowry shells and provided respite for sailors. Today, the mainstays of our export-oriented economy are tuna and tourism.”
He added that Maldivian tuna is “caught sustainably” by pole and line, making it “some of the best tuna available on the market.”
A ruling made in March by the Cabinet has now allowed long-line fishing for Maldivian vessels, which is more harmful to the environment. Although the government has defended its decision, there are still concerns from the fisheries industry and environmentalists that long-lining will adversely affect the industry and the environment in the Maldives.
President Nasheed ended his address by saying Maldivians and other Muslims have “always been entrepreneurial people” and the “dynamism and creativity of the Muslim peoples” should be harnessed and built upon.
Flights between Europe and the Maldives have been grounded due to the volcanic eruption in Iceland last week, uncovering the vulnerability of the tourism industry in the Maldives.
Although experts are saying that Iceland’s Eyjafjallajokull volcano had been erupting since March, it was last Wednesday’s eruption that created a thick cloud of volcanic ash which has spread over Europe and Scandinavia, grounding flights all over the continent.
Flights between Europe and the Maldives have also been affected, with British Airways, Sri Lankan Airlines, Air Berlin and Italian carriers Meridiana Fly cancelling flights to the Maldives until today, pending further instruction from Eurocontrol, the European Organisation for the Safety of Air Navigation.
‘Sim’ Mohamed Ibrahim from the Maldives Association of Tourism Industry (MATI) said “the cancellation of flights shows the vulnerability of the tourism industry to outside forces.”
Sim said the most important thing to note in this situation was “how vulnerable and dependent we are on external influences” and how much “incidents that we can’t control” affect the industry.
He said at the moment this is “not such a huge problem for resorts” but noted “people are not happy. Obviously, we are doing the best we can. The situation is very difficult to manage.”
Sim said although some resorts are “taking it very seriously and responsibly,” others were not doing as much as they could to ensure their guests were kept as happy and comfortable as possible under the circumstances.
“There is very little we can do,” he said, “there is no way anyone can leave or come [to the country].”
He noted Minister for Tourism, Arts and Culture Dr Ali Sawad has called for a meeting today with industry leaders, stockholders, travel agents and tour operators to discuss the best way to deal with the situation and the stranded passengers.
Dr Sawad said an estimated 63,000 flights have been cancelled in Europe from the 15-18 April, meaning about 5-6 flights a day scheduled to travel to the Maldives were also cancelled. He said around 15 flights directed to the Maldives have been cancelled from 17-19 April.
Flights have been grounded all over Europe
“This is an unprecedented situation,” he said, adding that a “common approach” needed to be agreed upon by the tourism industry on how to respond.
Dr Sawad said the government is discussing “how the ministry could facilitate the situation,” and assured that they were working with the immigration department so “visa and passport issues could be streamlined.”
He said some tourists are choosing to stay in the Maldives until their flights are re-scheduled, while some are trying to be re-routed.
“The problem is some people may have over-spent their budget,” he said, noting that “there must be some arrangement” made by the government and the tourism industry to facilitate the situation for foreigners.
He noted that industry leaders were now communicating with insurance companies to see how much impact this has had and how much damage is covered by insurance. Reports in the UK today were warning travellers that many insurance policies had ‘Act of God’ escape clauses that would leave travellers to fend for themselves.
“I’m sure tour operators and travel agencies are technically geared for this, but we must discuss it,” Sawad said, noting that the meeting later this afternoon would clear up the details and extent of the damage to the industry.
Eruption
Over twenty European countries are being affected by air restrictions caused by the volcanic ash, with many closing their airspace completely.
Statistics from Eurocontrol show that on 16 April, one day after the eruption, 20,000 flights would have normally taken place in European airspace, but only 11,000 flights took place. By 18 April, the expected average of 24,000 flights was dramatically reduced to only 5,000.
The British High Commission in Colombo has sent a message to stranded British nationals advising them to seek consular support and to check with their airline before going to the airport.
Airlines are offering passengers the choice of booking a later flight or getting a full refund, have advised to check with the airline before travelling to the airport. Some airlines have begun carrying out test flights, but most flights are still grounded until further notice.
The cancellation of flights has also affected many other import/export businesses in the Maldives, with many businesses being unable to send or receive their goods until flights resume.
Parliament’s Finance Committee has appointed a seven member sub-committee to discuss how media subsidies allocated in the state budget will be distributed. The recommendations will then be reviewed by the main committee and submitted for debate in Parliament.
Finance committee member MP Riyaz Rasheed told newspaper Miadhu that the committee was currently receiving submissions from media organisations and expected to make recommendations by the end of the week. Early discussions include splitting the amount allocated in the budget, about Rf4 million (US$307,600), between radio and newspapers at a ratio of 3:2.
Managing Editor of Miadhu Abdulla ‘Gabbe’ Latheef said that distributing the subsidies “just to media the Majlis likes is not fair. This money should be divided by the [soon to be elected] media council, not the Majlis.”
“For instance, they are only considering print and broadcast media for subsidies, not internet media,” he claimed. “Media in the Maldives is not only TVM and DhiTV.”
Latheef said that media subsidies in the past had not benefited staff, “only newspaper owners.”
Finance Minister Ali Hashim told Minivan News that any subsidies provided would take the form of training and capacity building, such as scholarships, rather than direct financial assistance.
“We will work with the [Maldivian Journalists] Association,” he said, but added as a caveat that “any form of hand outs compromise independence.”
Latheef said he feared the MJA was turning into the “Opposition Journalists Association”, as it had recently issued a press release reporting on a ‘meeting of editors’ to which it had failed to invite Miadhu.
Former Information Minister and Independent MP Mohamed Nasheed, who is not part of the committee deliberating on media subsidies, said he did not favour “cash handouts” but rather supportive subsidies, such as “10 to 15 percent of the electricity or water bill, rent, or the cost of training human resources.”
“Subsidies should be given for capacity building and upgrading quality of service, not necessarily cash-in-hand,” he suggested.
While he acknowledged that subsidies risked compromising media independence, Nasheed observed that media “is oxygen for democracy and a fundamental right in and of itself. You can’t compare it to something like subsidies for the fishing industry.”
“There needs to be a universal set of rules [for media subsidies] allocated through the government’s annual budget; they should work and earn it, and meet a set of criteria.”
Nasheed noted that during his time as Information Minister be formulated policy to stop newspapers “linked to people in the government” receiving direct subsidies in the form of rent assistance or lump sums for machinery.”
“This allowed the mushrooming of several papers favouring the then-opposition,” he noted.
Regarding the former government’s indirect subsidisation of media through advertising, Nasheed suggested a “one plus one” model whereby government ads would be rotated through the country’s largest newspapers. The current government moved all government advertising to an in-house gazette, a move that did not endear it to the country’s largest newspapers or the MJA, which has previously claimed that the unique economic situation and limited population of the Maldives is not conducive to 100 percent ad-funded media.
However Nasheed suggested “it’s a misnomer that this is a limited market. When you spread the papers out and see what they charge per centimetre, you can see what they’re getting in terms of advertising. But while they say how much they print, there’s no independent statistics for their circulation or how many people actually read the paper.”
“Nobody does these surveys and the papers are not willing open their records to the government,” Nasheed said.
Adjusting to an environment of competition and free expression was “today’s challenge [for the media],” he claimed. “Three years ago the challenges were very different, when the struggle was finding space for dissent, and the giving of that space. Today’s challenge is building credibility and capacity.”
Beyondthe issue of media subsidies, Nasheed said, “now we need to enshrine the principles of media freedom in our laws, build an independent institution that protects and consolidates media freedom, and introduce proceedures for the public to make complaints.”
Media Council
The Department of Information has meanwhile short-listed 14 candidates out of the 35 who applied to be members of the Maldives Media Council.
Those selected by the Department as candidates for the seven seats include Ahmed Mizmad, Ali Hashim, Fathimath Ishan Ali, Mohamed Azim, Abdul Hadhee, Ali Waheed Hassan Manik, Ibrahim Ismail, Mohamed Fareed, Aishath Aniya, Abdul Raheem, Ahmed Abdulla, Shujau Hussein, Anas Ali and Ahmed Faisal.
The department considered whether the candidates were eligible as stated in the Media Council Act, while giving priority to those without a stake in a media organisation, business, political party, or NGO, the official said.
The 14 candidates have a range of backgrounds including education sector, religious studies, politics, business and gender, the department said.
Representatives of 20 media organisations will vote on April 20 to elect seven members to the council. Information Department acknowledged some of them were from discontinued newspapers and magazines, but said they were eligible for voting.
“We can include them under the law, as long as they don’t dissolve the organisation. So we have decided to include them as well,” he added.
Representatives of DhiFM, DhiTV, Radio Atoll, a ceased newspaper called The Voice, Haveeru, E-Sandhaanu Magazine, Hiyama Magazine, Vanni Magazine, Minivan News Online, the now stopped Minivan Daily, Aaila (Family) Magazine, VTV, Navaranna, Sungadi, the disbanded Manas Daily, Manas Magazine, Haama Daily, Miadhu Newspaper, Television Maldives (TVM) and Youth TV would be voting in the election.
The MJA has expressed concern that several of those shortlisted “are editors of magazines and newspapers that have been dissolved, and some of titles the MJA has never heard of.”
“The MJA does not believe that the power of the Media Council should be given to these people,” it said in a press statement.
(0)Dislikes
(0)
