Clock is ticking for Nasheed and Maldivian economy: Frontline

Nasheed’s supporters say that his government inherited the “worst economic situation of any country undergoing democratic transition since the 1950s”, writes R K Radhakrishnan for India’s Frontline magazine.

“The budget deficit stood at 31 per cent of the GDP, inflation stood at 12 per cent, and the economy was reeling from a massive fiscal expansion, which saw the government wage bill increase by almost 400 per cent between 2004 and 2009.

For the Maldives, the belt-tightening could not have come at a worse time: it had barely recovered from the effects of the devastating Indian Ocean tsunami when the slowdown in the West (which affected the flow of tourists) hit home. This was followed by the serious disturbances in the Arab world, a region that the Maldives is tied to historically.

The protests were organised by the opposition parties even though these were labelled as youth-led. This led to a bizarre situation. Since the main opposition, the Dhivehi Rayyithunge Party (DRP), claimed that it had nothing to do with the protests, the government was left with no one to talk to. The government had maintained that a faction of the DRP [Z-DRP], led by former President Maumoon Abdul Gayoom, was behind the protests. It said that Gayoom was inspired by the events in Cairo’s Tahrir Square and that he was hoping to overthrow the government after crippling its functioning.

“There are indications that the current violence taking place in Male has… everything to do with a political struggle for who should lead the main opposition party, the DRP, into the next presidential election. It is unfortunate that that struggle is being played out on the streets of Male rather than, as should be the case, by holding an open and transparent primary,” the Maldivian Foreign Minister, Ahmed Naseem, said in Colombo last fortnight when asked about the protests.

Reports indicated that the number of people detained was about 300, but the Foreign Minister dismissed it. “Only 16 persons have been held,” he said. The Maldives Police Service said on May 8 that of all those arrested during the previous week of protests, six remained in detention under judicial warrant. All six had previous criminal records, it said.

“The government understands that many people are concerned about the economy and the recent price rise, and is committed to working to address these concerns through a process of dialogue. For example, yesterday [May 5] the Cabinet decided to halve the import duty on diesel fuel. However, the current economic difficulties reflect, at their heart, deep-seated structural problems inherited from the former government…. The government is working closely with the IMF to address these problems. This has already resulted in the deficit being reduced from 31 per cent to 16 per cent,” the Foreign Minister added.

The government looked forward to receiving credible, alternative economic proposals from the opposition, said Mohamed Zuhair, Press Secretary with the President’s Office.

For now, the protesters have gone home. But with better ferry connectivity, ironically put in place by President Nasheed, they can come back anytime and paralyse Male.

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