Cabinet resigns in protest over opposition MPs “scorched earth” politics

The entire cabinet of the Maldives has resigned in protest against “scorched earth politics” of the opposition-majority parliament, leaving only President Mohamed Nasheed and Vice President Mohamed Waheed Hassan in charge of the country.

Cabinet members handed Nasheed their letters of resignation this afternoon at 5:00pm in front of assembled press at the President’s Office, shortly after the weekly cabinet meeting.

Unusually, the four hour meeting was adjourned at two hours and reconvened in the President’s residence, Muleeage.

“The Majlis (parliament) is preventing the cabinet ministers from performing their legal obligations. Majlis members are behaving against the spirit and the letter of the Constitution,” the President told the media after the meeting.

“So I appeal with the honorable members of the Majlis not to muddy the waters for governance in this country and to lend us their cooperation.”

Attorney General Husnu Suood said parliament was making the country “ungovernable”.

“Every passing week, there is another attempt by opposition MPs to wrestle more control from the executive,” Suood said.

“The opposition MPs are operating a ‘scorched earth’ policy, trying to stop the government from doing any work to help the people. We have told the President that we cannot continue to work like this,” said Foreign Minister Dr Ahmed Shaheed, in a press statement.

Finance Minister Ali Hashim accused opposition MPs of “obstructing the business of government” by “awarding themselves powers to appoint members to independent institutions”, when this was “clearly a prerogative of the President.”

“They have declared that the government cannot raise any loans from abroad or rent any government or state asset without their say-so. And they are threatening Ministers with no confidence motions on spurious grounds,” he added.

In addition to revisions of the financial regulations, last week, parliament voted through amendments to the Civil Service Act to transfer powers of appointing members to the independent commission to a parliamentary committee.

Opposition MPs arrested

Shortly after the press conference concluded, Minivan News learned that the police and the Maldives National Defence Force (MNDF) had arrested the leaders of several opposition parties, including Jumhooree Party (JP) leader MP Gasim Ibrahim and People’s Alliance (PA) leader MP Abdulla Yameen (DRP), who have reportedly been taken to the prison on Dhoonidhoo island.

Sub-Inspector Ahmed Shiyam said “police are not saying anything officially at the moment,” but suggested Minivan News could “probably report what people are saying.”

Police and MNDF are meanwhile on high alert, while DRP supporters gathered at the artifical beach area outside the party’s headquarters. Reports around 9:00pm suggested rocks had been thrown, while sensitive areas around the President’s residence and the Majlis were sealed off by police and army roadblocks.

Meanwhile, the MDP National Council adopt a resolution to terminate its coalition agreement with Gasim’s Republican Party and recommend the dismissal of the party’s political appointees to President Nasheed.

The President’s Press Secretary Mohamed Zuhair told Minivan News that a police and MNDF investigation of corruption in the Majlis (parliament) would likely lead to “seven or eight parliamentary by-elections.”

“There have been allegations of corruption and attempted bribery, and allegations of certain threats against the state made by ministers,” Zuhair said.

He added that the government had “full confidence” in the state and deputy ministers, civil service and the permanent secretaries to keep the country running following the resignation of the ministers.

“Their resignation forces me to investigate using the police and the Maldives National Defence Force,” the President said, noting “I am Chief of the Armed Forces.”

Nasheed said amendments to the state finance laws passed by parliament yesterday, which requires any decisions relating to the leasing of state assets to be sent to parliament for approval, “was done in the self-interest of certain MPs. You cannot run the government like that.”

The President acknowledged that there would be “difficulties” faced by the people in the absence of cabinet ministers, “but it is the parliament who brought us to this situation.”

After the press conference, President Nasheed walked to police headquarters and requested police investigate the case.

Opposition reaction

Umar Naseer, Deputy Leader of the opposition Dhivehi Rayyithunge Party (DRP) which has the most number of seats in parliament in conjunction with its coalition partner the People’s Alliance (PA), said it was “really good that the cabinet ministers finally realised they were incapable.”

”The government along with the cabinet ministers was unable to govern the country,” Umar Naseer said. ”Now it is only the president and vice president [in charge], and how can they both do something they were unable to do with ministers.”

“Tomorrow President Nasheed will resign,” Umar Naseer predicted. ”Now it is the time to hold mid-term elections.”

He said this afternoon’s decision brought the current government to the brink of becoming a dictatorship.

”The President said he would launch an investigation using Police and the MNDF. That means he will probably arrest senior opposition leaders – I am not afraid of it.”

Umar added that however much he wished otherwise, “according to the constitution the president cannot dissolve parliament.”

DRP MP Ahmed Nihan described the incident as “an international joke” that “proved the government has failed.”

”For instance: three boats are competing in a race, and one of the boat’s crew abandons their vessel leaving only the captain and his first mate,” said Nihan. ”The current government does not have the majority support of the people.”

The arrest of Yameen and Gasim was “autocratic” and “a very ugly act”, Nihan said, adding that “President Mohamed Nasheed is worse than Adolf Hitler.”

Appearing before press at an impromptu press conference this evening, DRP Leader Ahmed Thasmeen Ali denied that the parliament had acted unconstitutionally.

The MP for Kendhoo argued that the government could have filed cases at the Supreme Court to decide on constitutional matters submit issues of in lieu of the mass resignations.

Thasmeen said the sudden arrests of MPs was not in the public interest, adding that the resignations showed that the government had ‘failed.’

Deadlocked

Parliament voted 47-11 yesterday in favour of an amendment bill that would allow them to veto every lease or loan agreement made between the government and an overseas party, allowing them to effectively prevent the government from privatising assets such as Male’ International Airport.

On Sunday a signing agreement between the government and GMR Infrastructure-Malaysia Airport Holdings to manage Male’ International Airport was scuttled in front of the waiting media, after a reported dispute among board members of the incumbent Maldives Airport Company Limited (MACL) over who would sign the document.

That evening, four opposition parties including the DRP, PA, JP and DQP signed an agreement to oppose the airport deal on nationalistic grounds, and the following day parliament passed the amendment bill allowing the Majlis to veto any such project.

The government nonetheless reshuffled the MACL board members and proceeded with the signing ceremony on Monday evening. However today it was reported that the opposition parties had filed a civil court action seeking an injunction to block the deal going ahead.

Sources in the President’s Office suggested “this was probably the straw that broke the camel’s back” and led to this evening’s Executive outburst against the Majlis.

Other possible causes include a recent no-confidence motion levelled at Education Minister Dr Mustafa Luthfy by Independent MP Ibrahim Muttalib, after the Ministry’s steering committee proposed make the Islam and Dhivehi subjects optional at A-Level.

Former Auditor General Ibrahim Naeem, who had previously released audit reports alleging rampant corruption in the former government, was also dismissed by parliament shortly after announcing a financial audit of current and former government ministers, including former President Maumoon Abdul Gayoom. However the Anti-Corruption Commission (ACC) reported to parliament that Naeem had misused a government credit card to purchase transport and a tie, and he was removed from office.

Last year a no-confidence motion against the Foreign Minister Dr Ahmed Shaheed was narrowly defeated, after the government sought to renewed diplomatic relations with Israel.

Note: Minivan News apologises for earlier disruption to the site following publication of this report. At peak demand we were receiving 200 requests a second, critically overloading the website’s database.

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President’s speech on the resignation of cabinet

The following is a literal Dhivehi-English translation of the President Mohamed Nasheed’s speech to the media at the President’s Office on Tuesday afternoon, announcing the resignation of his cabinet members.

Today I meet the Maldivian media because the ministers of the government have noted that they are unable to fulfill their responsibilities according to their oath.

All the members of the cabinet are saying that they do not receive any cooperation from the Majlis, that many members of the Majlis are not acting in line with the spirit of the constitution and that they are also violating the articles of the constitution.

Believing a huge majority is with them, and through this majority members of the parliament are violating the very spirit of the constitution we are trying to implement and enforce.

The ministers have said that they are finding it extremely difficult to carry on with their responsibilities, and that therefore they wish to resign until the Majlis acts in a different manner.

All the members of the cabinet are requesting this, so today in accordance with the constitution which reads that after I receive the resignation of all cabinet ministers, myself and vice president Dr Mohamed Waheed Hassan Manik will only remain in the cabinet.

I assure the citizens that this government’s one and only aim and goal is to serve the people. This government was formed to establish a system which listens to the voice of the people, and to establish a system which fulfills the needs of the people according to their pulse and also to follow up with that system of governance.

So I request the honorable members of the Majlis to not cloud the atmosphere of governance in the country and to lend me their cooperation while continuing with their work.

I am obliged to look into the complaints made by the members of the cabinet about the Majlis members, therefore today I will start looking into them and I shall do everything possible, in the boundaries of the law, to look into these complaints and issues.

I am the head of state of this country. I am also the head of the police and defense forces. I have put myself up to the task of leading this country to serve the people. We did not come to power with the intent to do whatever we would like to the extent we are able to do. So I am obliged to look into the complaints of the cabinet members and I assure the citizens that I will look into these complaints.

I intend to accept the letters from the ministers in front of all of you. I have not yet received their letters but the cabinet secretary had informed me that he had received the letters. So I ask the cabinet secretary to hand the letters over to me and afterwards I will answer your questions. A bit of time would be required for this (handing over the letters) but I cannot spend too much time on this today.

When the letters of the cabinet ministers are kept on this table, they have been accepted by me by default.

<President accepts letters of resignation>

Among all the letters I just have looked into, only the letter missing is that of Home Minister Mohamed Shihab, as he has mailed it since he is currently not in (Male’).

I sincerely and from the bottom of my heart, thank the cabinet ministers. The strength they have shown, the discipline and integrity they have maintained and their loyalty and readiness to serve this nation and to uphold the features and the spirit of the constitution, I believe never will be doubted by the citizens of this country.

In the history of this country, rarely does a minister resign. If cabinet ministers cannot fulfill their legal duties and responsibilities due to any reason, I do believe that they would have to think about it.

Today my responsibility is to look into the complaints right away. I will look into the complaints of the ministers and I will take necessary action afterwards. I assure this to all citizens of this country.

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Government signs Male International Airport to GMR-Malaysia Airports consortium

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.”

airportsigning2
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.

The government’s Net Present Value calculations:

  • TAV-ADPM
    Upfront fee: US$7m
    Variable concession fees share – non fuel – 2011-2014: 31%
    Variable concession fees – fuel – 2011-2014: 16.5%
    Variable concession fees share – non fuel – 2015-2025: 29.5%
    Variable concession fees – fuel – 2015-2025: 16.5%
    NPV: 454.04
  • GMR-MAH
    Upfront fee: US$78m
    Variable concession fees share – non fuel – 2011-2014: 1%
    Variable concession fees – fuel – 2011-2014: 15%
    Variable concession fees share – non fuel – 2015-2025: 10%
    Variable concession fees – fuel – 2015-2025: 27%
    NPV: 495.18
  • Unique-GVK
    Upfront fee: US$27m
    Variable concession fees share – non fuel – 2011-2014: 27%
    Variable concession fees – fuel – 2011-2014: 9%
    Variable concession fees share – non fuel – 2015-2025: 9%
    Variable concession fees – fuel – 2015-2025: 9%
    NPV: 266.94
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Parliament’s approval of Financial Bill will impact pledges, say MDP

The parliament has today approved a Financial Bill including an amendment which declares that government can only lease a state asset or could borrow money from a foreign country under specific legislation approved by parliament.

The bill was approved 41 in favour to 33 against out of 75 members present.

Maldivian Democratic Party (MDP) MP Mohamed ‘Colonel’ Nasheed said he regretted the bill had been passed and that he was “very concerned” over its approval.

”All the services that MDP has planned to provide for the people will be disrupted according to this bill,” said Nasheed.

”Right now there is a hung parliament and it is very difficult to bring out and sufficient results from it.”

Nasheed said that responsibility for the country’s financial condition was the duty of the President and the Finance Ministry, according to the constitution.

”The Bill was not approved in the best interests of the country,” he added. ”I regret the approved amendments [governing privatisation].”

Spokesperson for MDP Ahmed Haleem said the bill was approved according to “the self-interest of two or three businessmen in parliament.”

”This bill will obstruct the public and private partnership policy of the government,” said Haleem. ”It was not passed for the benefit of the people of the country.”

However, Dhivehi Rayyithunge Party (DRP) MP Dr Abdulla Mausoom said that the government was required to govern the country “according to how its people wish.”

”The parliament represents the people,” Dr Mausoom said, ”and according to the bill, the government will now need the approval of the parliament when leasing state assets or taking loans from other countries.”

Dr Mausoom said the parliament “belongs to the people” and would only make decisions “for the benefit of the people.”

”I do not see any article in the bill that disrupts the government’s pledges,” he said. ”Privatising Male’ International Airport was not a pledge of the government.”

A senior government official Minivan News spoke to during the privatisation signing ceremony accused the opposition “of running a scorched earth policy to deny the government any chance of improving the country. It’s so short sighted – what do they hope to inherit if they gain power in the next election?”

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Take Lale School back from Biz Atoll: HRCM to Education Ministry

A report by the Human Rights Commission of the Maldives (HRCM) into Lale Youth International School on Hulhumale has recommended that the Education Ministry terminate its contract with Maldives-registered company Biz Atoll Pvt Ltd to manage Lale Youth International School, “and hand over management as soon as possible to a qualified party.

The Commission’s investigation had found that students had been “physically and psychologically abused, discriminated against and bullied,” the report stated, recommending “that police should investigate the physical and psychological abuse going on at the school as an urgent concern,” and “separate those suspected of physical abuse from the school’s students until the police investigation is concluded.”

The report also questioned the educational standards of the private school, observing that despite the “high fees” charged for students to attend, the school “has no laboratory for students preparing for the IGCSE” in 2011, the library “does not have books that students need”, and most of the Turkish teachers “do not know English and are therefore unable to teach.”

The government-run Fareediyya School was handed to Biz Atoll and a group of philanthropic Turkish businessmen in 2008, under an agreement made between Biz Atoll and the Education Ministry during the former administration.

In May this year, Minivan News reported concerns raised by parents and staff that the school was being used as ‘a front’ for other activities, highlighting anomalies such as ‘phantom’ foreign teachers who were being paid but had never reported to work, students being charged an assortment of fees arbitrarily, teachers with missing or fraudulent qualifications, and significant pay discrepancies between Turkish and other foreign staff.

Shortly after the Minivan News report was published, (now former) Principal of Lale Serkan Akar attempted to leave the country, leading to the confiscation of his passport. On a second attempt to leave he was taken into police custody and is currently in the criminal court facing assault charges for allegedly strangling and whipping a child with a belt, charges he has denied.

Since the story was published, Minivan News has learned that website has been blocked the school’s web filter.

The HRCM report also recommended that the school move to “dismiss employees with criminal records” and amend the school’s child protection policy to ensure that “inappropriate persons” did not work with students, and amend employment contracts “to allow adequate disciplinary action” against those suspected of physical abuse.

HRCM further recommended that Biz Atoll immediately submit the credentials of foreign teachers to the Maldives Qualification Authority (MQA) for approval, and stipulate that foreign teachers present certification of English qualification such as IELTS or TOEFL – and dismiss those teachers who did not meet the criteria listed in regulations governing private schools.

HRCM also suggested that the school establish a laboratory and library as required in its agreement with the Education Ministry, and hire a full-time librarian. It should also “immediately cease the practice of giving the same examination paper to students until they pass” and “stop charging additional fees other than those set by the Ministry” while ensuring that those fees “are commensurate to the quality of education offered.”

The HRCM report also raised concerns about the school’s adherence to employment practices in the Maldives, noting “allegations of discrimination and mistreatment of Asian and Maldivian staff”. It recommended the school establish both a school board, as required by law, and a mechanism for teachers to resolve employment issues.

HRCM also recommended the school formulate a pay scheme in accordance with employment laws “to eliminate discrimination and ensure fairness and transparency”, as well as “reimburse employees if a deposit has been subtracted from their salaries to allow them to keep their passports.”

Furthermore, the Education Ministry should formulate regulations governing international schools “to ensure supervision and monitoring by the ministry as a regulatory body”, and “establish guidelines to conduct follow-ups to supervision reports.”

“As the school was not handed over to the proprietor in a transparent manner and because the Education Ministry has not undertaken adequate efforts to improve matters at the school, and since corruption has been noted, these cases should be investigated,” HRCM’s report concluded.

HumanRightsCommission'sLogoForGallery
HRCM has recommended the government repossess Lale School from Biz Atoll

Response

Managing Director of Biz Atoll, Abdulla Jameel, said the company had read the report “and are reviewing the necessary actions we have to take.”

“We will bring changes to the school,” he promised, noting that a new principal would be starting “quite soon”.

The arrangement with the Turkish funders of the school would “definitely” continue, he noted.

Regarding HRCM’s recommendation that the school be repossessed from Biz Atoll and given to “a qualified party”, Jameel said the decision was “up to the government”.

“I respect the professional work of HRCM, but at the same time I’m disappointed it has mentioned nothing positive about the school,” he said, noting its reputation for “academic excellence.”

“Given the opportunity, we will continue to manage the school and try our best to make it the number one school in the Maldives.”

Jameel would not comment on the child abuse case pending against the former principal Akar.

Deputy Minister of Education Dr Abdullah Nazeer said the Education Ministry “received the report on Thursday” and was now seeking legal advice from the Attorney General’s office concerning the repossession of the school.

“We don’t agree with all the findings [in the HRCM report] – there are certain issues we need to refute from the ministry’s side, and we have communicated this in writing,” he said. “It was very unfortunate the report was not amended [before it was released].”

“The word used repeatedly to describe the Education Ministry is ‘irresponsible’,” he said, “[but] we were the ones who first contacted police, and based on that HRCM investigated the school.”

Police had yet to find evidence to support any allegations of abuse, he claimed.

The report was critical of the ministry’s decision to review the contract with Biz Atoll during the investigation, Dr Nazeer noted.

“We added amendements to the earlier contract (requesting a new principal in three months and including a termination clause),” he explained.

There were only “very general written regulations” governing the ministry’s role in supervising privately-owned and operated schools, he noted. “The regulations do not specifically say the government should intervene,” he said.

The Education Ministry was already seeking to resolve the employment issues at the school Dr Nazeer said, and had sent a letter to Biz Atoll on the subject

“We also had a complaint from a parent that the former Principal [Serkan Akar] was still accessing the school grounds,” he said. “We also wrote a letter to Biz Atoll saying it was not appropriate for a person currently involved in a court case concerning child abuse to be accessing the school.”

Dr Nazeer also noted that a delegation of officials from the Turkish government and the business community, had arrived in the Maldives and was currently meeting members of parliament to discuss the matter together with the the Turkish Consular General in Male’.

“I can’t comment on the delegation as I am yet to have a meeting with them,” Dr Nazeer said. “I don’t know what they will discuss.”

“As far as we are concerned, we are waiting for the Attorney General’s office to determine the gravity of the findings in the report, and if they agree, provide advice for terminating the contract.”

Download the full HRCM investigation report (Dhivehi)

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Airport deal “will allow Israeli flights to stop over after bombing Arab countries”: Umar Naseer

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.

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Failure to upgrade airport could lead to ICAO blacklist: aviation expert

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.

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Boy missing in Male’ discovered in Addu Atoll

Police have located missing 14 year old Ahmed Laizam Latheef on Hithadhoo in Addu Atoll, after his family reported him missing at 11:30pm on Wednesday night.

Laizam is from Kashmeeruge in Seenu Feydhoo Atoll but was living at Ma. Velagala in Male’. His family reported him missing after he left home to pray in the nearby mosque across the road but did not return.

A family member told Minivan News the boy was not used to going anywhere alone, ”and he only goes to the mosque by himself as it is very close to our house.”

Police Sub-Inspector Ahmed Shiyam said Laizam had taken a boat to Addu Atoll where we was staying with relatives on Hithadhoo.

“Police confirmed he was there, but he was sleeping so we didn’t disturb him,” Shiyam said, adding that police are now investigating why he left home.

“At this time, we can’t say why he left home,” Shiyam said. “He went by himself – nobody told him to go.”

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Bids of up to Rf1 billion for airport, while Jumhoory Party announces ”special gathering” to express disapproval

Indian company GMR Infrastructure has said it is confident it will win the bid for Male’ International Airport, after offering US$78 million (Rf1 billion) upfront.

“Considering the offers, we will get the highest marks. We will make the payments and take over the operations of the airport in March,” newspaper Haveeru reported one official as saying.

Finance Minister Ali Hashim disclosed the bids at a function today.

Bids at a glance:

  • GMR-KLIA: US$78 million upfront and one percent of the total profit in the first year (until 2014), and 10 percent of the profit from 2015 to 2035. GMR would also pay 15 percent of fuel trade revenues to the government in the first four years and 27 percent from 2015 to 2035.
  • Turkish TAV Airports Holdings Company and French Airports De Paris: US$7 million (RF89.95 million) upfront payment, with 31 percent of the total profit until 2014 and 29.5 percent from 2015 to 2035. The consortium offered 16.5 percent of the profits from fuel trade.
  • Swiss Flughafen Zurich AG and GVK Airport Developers offered US$27 million (Rf346.95 million), along with 27 percent of the total profit in the first four years and nine percent of the profit from 2015 to 2035. The consortium said it would pay nine percent of fuel revenues to the government.

The Jumhoory Party (JP), led by Gasim ‘Buruma’ Ibrahim, has meanwhile announced that it will conduct a ”special gathering” to express disapproval at the government’s decision to privatise Male’ international airport.

Ali Shareef, secretary general of JP, said the special gathering would be conducted in collaboration with other NGOs and political parties.

”Male’ international airport was built by our forefathers and it is one of the assets of the state,” said Shareef. ”There are many concerns over privatising the airport, and we want to express our opinions during this special gathering.”

Shareef said the transaction could cause disruption and “national security issues”, and would decrease government revenue.

‘There is no transparency in this transaction,” he said. ”We are very concerned over the issue.”

He said that the gathering would be “a peaceful gathering.”

”We want to gather people and make them aware of what’s happening, and tell them the consequences of it,” he said. ”There is the potential for many problems if foreigners control the country’s main entrance.”

He said that the venue, date and time of the gathering was yet to be advised.

”We are in discussion with other parties involved and will decide the venue and date very soon,” he said.

Moosa Rameez, Spokesperson of JP, said members of the party and people of the country were concerned over the issue.

”Male’ international airport is a asset of the state which was built by the people,” said Moosa. ”We do not want it to be given to a foreign party.”

The Dhivehi Rayyithunge Party (DRP) has also expressed concerned over the issue.

Vice President and Spokesman for the opposition Dhivehi Rayyithunge Party (DRP) Ibrahim Shareef said the party 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.

Shareef also expressed concern that the government’s efforts to privatise state assets, such as the airport, were not occurring with parliament approval.

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 recently 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.

This week government shortlisted three parties to run Male’ International airport and has it would select one by the end of the week.

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.

Press secretary for the president, Mohamed Zuhair did not respond to Minivan News at time of press.

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