Month: January 2011

In the black: customs documents expose Maldives’ chronic oil addiction

The 15 percent increase in oil prices over the past five months has led to the Maldives spending almost US$100,000 more on fossil fuels, per day.

Customs figures obtained by Minivan News reveal the true extent of the country’s chronic addiction to fossil fuels, and extraordinary vulnerability to even minor price rises.

In 2010, the Maldives spent over US$245 million on fuel (including marine diesel, aviation gas, propane and petrol) – disturbingly, almost a quarter of the country’s US$1 billion GDP.

The vast proportion (US$200 million) of the country’s fuel spend was on marine diesel. Petrol accounted for US$24 million, liquefied propane US$10 million, and aviation fuel US$12 million.

This represents a daily expenditure of US$670,000 to meet the country’s fuel needs, approximately US$800 per person per year in a country where the average annual income is under US$5000.

Oil is currently US$86 a barrel after trending a 15 percent increase over the past five months, which shows no sign of slowing. The International Monetary Fund (IMF), together with other analysts, have confidently tipped that oil will reach an average $90 a barrel in 2011, and potentially top US$100.

The figures also reveal that the Maldives is highly dependent on several countries for most of its fuel – Singapore (for aviation fuel), the UAE (petrol) and the Bahamas (marine diesel).

The revelation of the extent of marine fuel consumed in the country – over 2 million barrels annually – is one that President Nasheed’s Energy Advisor Mike Mason suggests is a strong argument for a return to sailing.

“I think there is a huge opportunity to take a knowledge of sail, wind and current – the thinking that has served the Maldives well for 2000 years – and apply modern technology such as solar to create a new transport paradigm. A sailing vessel with a modern hull, utilising modern technology can reach 30-40 knots, and would greatly reduce the reliance on diesel.”

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Tunisian revolution ripples throughout Middle East

President Mohamed Nasheed has spoken to the leader of the Tunisian opposition as ripples from the fall of its deposed President Zine El Abidine Ben Ali spread throughout the Arab world.

Speaking to Moncef Marzouki over the phone, Nasheed expressed the hope that democracy, human rights and the rule of law would prevail.

He also condemned the use of violence against civilians during the protests, and the human rights abuses that were occurring in the country.

The government in Tunisia, previously regarded as one of the Middle East’s most stable democracies and a popular tourist destination, was overthrown after widespread protests and growing street violence eventually forced Ben Ali to flee the country on January 14 after 23 years in power.

In a surreal side note, Ben Ali’s wife reportedly retrieved US$60 million worth of gold in person from the country’s central bank before fleeing to the airport with her husband. The bank has denied the reports, leaked by French security officials.

The protests were sparked after Mohamed Bouazizi, a local fruitseller, set himself on fire when police confiscated his cart. That incident sparked a national uprising that led to almost 100 deaths in clashes with security forces, and the hasty departure of the President. The government has since issued an arrest warrant for Ben Ali in absentia.

The violence triggered a wave of regional instability, particularly in Egypt, where tens of thousands of protesters took to the streets on Tuesday in opposition to 29 years of strict rule by President Hosni Mubarak.

Three people were reported killed, including a policeman, while three more self-immolated in imitation of Bouazizi. Protests also erupted in Yemen, Jordan and Algeria.

Regional analysts such as Robert Fisk have observed that Tunsia was widely feted by the West for the stability of its autocracy: “If it can happen in the holiday destination Tunisia, it can happen anywhere, can’t it? The French and the Germans and the Brits, dare we mention this, always praised the dictator for being a ‘friend’ of civilised Europe, keeping a firm hand on all those Islamists,” Fisk wrote in UK newspaper The Independent.

Meanwhile, further revelations from al-Jazeera’s publication of controversial documents detailing 10 years of the Israeli-Palestinian peace process include details of a secret crackdown on Hamas, orchestrated by British Intelligence and executed by the Palestinian Authority (PA).

The 2004 plans also reveal a high degree of security cooperation between Israel and Palestinian security forces, further heightening public anger in Palestine against the PA.

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President upholds ACC’s postponement of border control shakeup

President Mohamed Nasheed has upheld the decision to postpone the roll-out of a new electronic border control system for the Maldives in accordance with concerns by the Anti-Corruption Commission (ACC) over the project’s selection process.

The President’s Office confirmed to Minivan News that Nasheed has requested that the Department of Immigration and Emigration adhere to the ACC’s guidance until it rules over the next step for the project, with no appeal expected to be heard on the current decision.

Work on the project was suspended soon after being agreed last October, when the ACC raised concerns over allegations of corruption in the decision making process.

The ongoing criticism by the ACC of the Nexbis border control agreement has itself come under fire amidst accusations that it represents a politically-motivated attack on wider government reforms, according to a source within the immigration department.

A spokesperson for the ACC was not available for comment at the time of going to press.

However, the ACC this week sent a confidential letter to Immigration Controller Ilyas Hussain Ibrahim calling for approval from the Maldives Cabinet or National Planning Council (NPC) over concerns regarding corruption within the decision making process for the deal. The letter was also leaked to the press.

Prior to the President’s decision to hold the project, a source within the immigration department told Minivan News that it had remained confident that the project, signed with Malaysia-based Nexbis in October as part of attempts to prevent abuse of the working visa system, would be “greenlit” by either the cabinet or the NPC.

Having already been approved by two independent audits, the source claimed that President Nasheed had also indicated to local media this week that he saw no reason to oppose the existing agreement for the new border control system.

However, the immigration department said that it will comply with the President’s orders and wait for any further decisions by the ACC relating to border control.

Alongside refuting any suggestions that corruption had played a role within the decision to choose Nexbis, the Immigration Department insider claimed that technical criticisms of the system were part of wider political moves to try and disrupt the government’s reform of the border control system.

However, the anti-corruption body is said to have highlighted a number of issues concerning the different models used to identify travel documents such as passports under the visa scheme.

“The ACC does not have the technical background to be able to criticise and understand the [border control] system,” said the immigration department source. “More education is needed [within the commission].”

The Nexbis border control project had aimed to make use of fingerprint and facial recognition devices that according the Department of Immigration could be set up within four to six months as part of the first phase of the project focusing on working visas – essentially matching individuals to records without the requirement for paper documents.

However, the President’s decision means that the work will continue to remain on hold since the signing in October.

“On the very day we signed the contract, barely hours, maybe minutes later, the ACC had drafted a letter saying there was suspicions of corruption involved with the decision,” said the immigration department source, who asked not to be identified. “From that moment, we have stopped work on the system as requested by the ACC.”

When news of the disruption broke in November, shares in Nexbis immediately dropped 6.3 percent. Minivan News has since spoken to other foreign investors in the Maldives who have expressed concern that their share prices were at risk of becoming collateral in local politics.

The injunction issued by the ACC effectively places an indefinite delay on the project. The commission has not finalised an investigation since 2008.

Trafficking concerns

Immigration reforms, of which the Nexbis project was part, were intended in part to address the government’s serious concerns over labour trafficking.

Last year, the Maldives was placed on the US State Department watch list for human trafficking, a crime which may actually narrowly eclipse the fishing industry as the second-largest contributor to the Maldivian economy after tourism, US$43.8 million on paper but potentially reaching up to US$200 million.

The Nexbis system was said to allow the immigration department to store and retrieve the biometric data of expatriates working in the country, effectively circumventing the abuse of paper documentation and curbing the ability of workers – and traffickers – to operate in the country.

“We currently have a large number of illegal expatriates running around the country,” another source at the immigration department told Minivan News back in 2010. “Right now estimate that there are 100,000 foreign workers in the country, but there are no official figures on how many may be illegal.”

Workers were arriving in the country legally “but once in the country they discard the documents and flee to islands, and seek better payment.”

Many companies in the Maldives were benefiting “and facilitating” the problem, the source said, which was impacting those companies “who do operate legally and pay visa fees to the government.”

Ensuring that workers could be accurately identified, even without documentation, was the key benefit of the new system, the source explained.

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Backup generators fail at IGMH during power outage

Backup generators at Indira Gandhi Memorial Hospital (IGMH) failed early on Tuesday morning, after a power outage in Male’ left the hospital without electricity.

A person who was at he hospital at the time told Haveeru that IGMH was in pitch darkness when the blackout occurred at 1:30am, with even staff in the intensive care unit forced to use torches.

“They did not turn on the backup system after the power outage. The whole ICU was full. People were very upset,” the witness told the paper.

Male Health Services Corporation (MHSC) Media Coordinator Zeenath Ali told Haveeru that the power was restored after 15 minutes and that no patients had been hurt.

A STELCO engineer said the power outage was due to an overheating generator.

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Five percent voter turnout expected in Colombo for upcoming elections

Only 400 of the 8000 Maldivians living in Sri Lanka – five percent – have registered to vote in the local council elections, reports Haveeru, citing sources from the Maldives High Commission in Colombo.

Haveeru quoted a Maldivian businessman living in Sri Lanka as saying that despite email campaigns circulated by the parties to try and breach the apathy, “the main reason for Maldivians in Sri Lanka not being interested in registering themselves to vote is mainly due to lack of awareness or enthusiasm.”

Maldivians based in Sri Lanka were required to register to vote before January 5, a month ahead of the election which will see 2830 candidates competing for 1091 council seats.

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Civil Court rejects second case against JSC’s High Court appointments

The Civil Court has rejected a second case filed by a judge opposing the Judicial Services Commission (JSC)’s appointment of High Court’s judges, reports Haveeru.

Chief judge of the Family Court Hassan Saeed filed a case in the Civil Court calling for the JSC’s appointments to be invalidated.

Last week Criminal Court judge Abdul Bari Yousuf, one of the unsuccessful applicants to the High Court bench, filed a similar case that was accepted by the court – however it was blocked from hearing the matter by the Supreme Court, which issued an unprecedented Writ of Prohibition and requested the case file.

High Court judges appointment by the JSC last week include Juvenile Court Chief Judge Shuaib Hussein Zakariya, former Law Commission member Dr Azmiralda Zahir, Civil Court registrar Abdu Rauf Ibrahim, lawyer of former President Maumoon Abdul Gayoom, Abbas Shareef and Civil Court Chief Judge Ali Sameer.

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Cabinet meeting held outside Male’ for first time

Cabinet held its first meeting outside the capital of Male’ today, on Kulhudhuffushi in Haa Dhaal Atoll.

All ministers attended the meeting apart from Islamic Minister Dr Abdul Majeed Abdul Bari, who was overseas.

Press Secretary for the President Mohamed Zuhair told Haveeru that meeting focused on deciding the date for the establishment of a National University, and issues raised during an early workshop concerning development projects for the Upper North Province.

These included developing roads on the island, harbours, house construction, utilities and how to use recently reclaimed land on the island.

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Plane as day: Mega takes off on back of Chinese tourism boom

The Maldives’ newest international airline, Mega Global Maldives, has just completed its maiden international flight between Hong Kong and Gan, delivering over 230 passengers to resorts in the southern atolls.

The charter flight was the first of what Mega intends to become a weekly service, delivering thousands of tourists a month under an arrangement between the airline, participating resorts, and Chinese tour operators.

Minivan News spoke to Mega’s CEO George Weinmann, a former rocket and satellite engineer with aerospace giant Boeing, as he stood on the beach of Herathera resort surrounded by “235 very happy guests about to go sailing – they are already talking about when they’re coming back.”

Weinmann has lived in China for seven years and believes that the potential of the Chinese market in the Maldives is being underestimated by an industry focused on its traditional, European-centric market.

“My first experience of the Maldives was on honeymoon with my wife, who is Chinese,” he said. “At the time I was looking for an investment opportunity and saw a big market that was developing fast – it has since exceeded our expectations.

“The Chinese market is deep and very rich. We believe there are further improvements to how the market is targeted and served.”

In 2010 the number of arrivals from China eclipsed arrivals from all other destinations, for the first time in the Maldives’ history. The influx of Chinese guests at resorts has been credited with partially cushioning the industry from the economic crisis in Europe, particularly during the warmer off-season when many sun-seeking Europeans have the option of travelling to closer countries such as Greece and Spain.

Weinmann believes that many resorts haven’t given the Chinese market the attention it requires to develop, in the mistaken belief that the boom in Chinese visitors is a temporary anomaly – a belief perhaps stemming from the trend among many Chinese guests to stay 2-3 days, while their European counterparts log an average of 10-14 days per visit.

“I don’t agree with that idea at all,” says Weinmann. “It’s a little like going back to the 1950s and saying that while the US is making a resurgence, Europe is still the place to be.”

The Chinese, he said, had become one of the biggest-spending tourism demographics in destinations such as France, with a per-person spend “substantially higher that most other [nationalities] visiting the EU. That was not a fluke – it was developed over five years.”

He noted that a colleague in China “has booked 60,000 airline seats to the EU on the basis of that demand from tour operators, and is booking more because of the demand.”

In the Maldives, Weinmann predicts eventual demand for an additional 20 resorts catering to the Chinese market, open all year round. Unlike the European sector, he explains, the Chinese market “doesn’t drop in volume. The weakest months for China are March and April, but that’s the start of the honeymoon season in Korea.”

Mega was unlikely to see competition from the much larger Chinese and Hong Kong carriers, Weinmann suggests, because they still regarded the Maldives as a niche market.

“There currently no flights from Asia that arrive in the Maldives in day time, which is not convenient for either the resorts or the seaplane operators,” he said. “We are seeing travel agents who are not satisfied with the schedules.”

Mega’s initial focus on charter flights in conjunction with tour operators and resorts not only ensures an early steady steam of income for the fledgling airline, but allows development of the product for Chinese visitors. Weinmann explains: “The benefit for us is that as a Maldivian airline we can start the whole resort experience with clients the moment they step on the plane. Tour operators like that.”

The collaboration with resorts and the early focus on the south of the Maldives, had meant a great deal of early support for the airline from resorts such as Shangri La and Herathera, Weinmann says.

“The southern resorts are very keen to have us, and have put together a very attractive package [for us]. We flew some Chinese guest relations officers with us to Herathera, several of our senior management speak Chinese, and the resorts are hiring some people from Thailand who have experience with the language.”

Eventually the airline hopes to operate a scheduled service, and potentially a domestic connection between Male’ and Gan to connect the Gan-Hong Kong route to more of the Maldives “as the market develops.”

The potential for opening other domestic routes was limited by the 264 seats on the company’s 767, but Weinmann says he sees potential to develop routes between the Maldives, Korea, Thailand and India, the latter for business travel as well as tourism – “the Indian [tourism] market is about two years behind China”, he suggests.

Weinmann says Mega has learned from the experiences of Air Maldives, the national flag carrier that declared bankruptcy in 2000 after ambitious over-expansion into international routes.

“I’m very aware of Air Maldives, and although didn’t experience it myself I have from the point of view of some of our staff who did,” he says. “A new airline has to be careful of its own success – if you get the market right it can be tempting to expand quickly. But each plane is a huge one-time cost, and several planes in a row can quickly deplete your financial resources. Then if you realise you haven’t got the market quite right, your expenses are very high and you have to hope you have very deep pockets. We have been very careful about how quickly we have developed.”

Setting up a new airline is not without obstacles, but Weinmann says Mega has been able to overcome those placed in its way so far. As a local carrier it was, he says, gratifying to see bodies such as the Civil Aviation Authority show “enthusiasm for us to succeed.”

Tourism Minister Dr Mariyam Zulfa said the resort industry was “on the right track” in adapting to rising demand from China, and noted that the Ministry had issued a circular to resorts requesting they provided safely regulations to Chinese guests in Mandarin – tourist fatalities last year were disproportionately Chinese nationals, mostly in snorkeling-related accidents.

There remained, Zulfa said, not enough mid-market beds, which was why the government was pushing for small-to-medium enterprise to develop 3-4 star hotels to compliment the luxury resorts that already existed in the country – a concept Weinmann agrees with: “the Maldives’ geography makes it unique, because the one-resort one-island concept means it can naturally segment the market based on demand.”

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Significant increase in drug charges against juveniles last year, says Juvenile Court

The Juvenile Court has observed a “significant increase” in the number of juveniles charged with drug offences last year.

”In 2009 there were 22 drug-related charges in the court concerning juveniles, while 34 such cases were presented to the court last year,” said the Juvenile Court in a statement.

The court said it had also observed a rising number of charges of drug dealing against minors, with nine cases sent to the court in 2010, an increase of three on 2009. Of the nine cases, three youths were found guilty.

‘The court added that 10 juveniles were brought to the court for extension of detention on charges of possessing illegal drugs for dealing, suggesting that this was “very concerning ” as it was “a sinister crime in nature that serves high penalties.

Juvenile Court said that it was very important for parents to prevent their kids from committing such crimes and urged everyone to pay more attention to juveniles.

Furthermore, the Juvenile Court said, that there were people in society “who are behind the crimes committed by juveniles.”

Police statistics for 2010 showed that most arrests made across the Maldives in 2010 were for drug offences (1153), assault (941) and theft (773), and that most of these were first time offenders.

While the bulk of those arrested were young men aged between 17-23, key crimes committed by minors (aged under 18) were assault, theft and drug offences – albeit with an overall decline in 2010 on 2009.

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