The main opposition Dhivehi Rayyithunge Party (DRP) is organising a mass demonstration in Male’ tonight to protest the government’s decision to raise electricity tariffs.
The protest will take place near the tsunami monument at 8.30pm and will call on the government to restore the price of electricity units to the rates that existed in December 2008.
At a press conference yesterday, DRP MP Ahmed Nihan said “the government will be forced” to reverse the hiked rates as a result of the protest.
Nihan warned that the protest “could get heated and might be drawn out.”
Participants at the protest rally will be wearing red shirts symbolizing the “red notice” received by many citizens unable to pay their electricity bills.
Galholu South MP Ahmed Mahlouf said tonight’s protest will be “very different” and other political parties have signaled their support.
“You will see different things in this protest,” he said. “We want to leave it a surprise.”
Moreover, the party intends to continue the protest until its demand is met.
Imad Solih, vice-president of the Dhivehi Qaumee Party (DQP), announced on private broadcaster DhiTV that the party will join the protest as the issue was of national concern.
He alleged that the government was “deceiving the people” about electricity subsidies to poor income families.
Energy policy
In a campaign rally before the second round of the 2008 presidential election runoff, President Mohamed Nasheed pledged that the price of a unit of electricity would not go up in his government.
However, the State Electricity Company (STELCO) raised its tariffs in November as part of a restructure to bring electricity charges in line with operating costs.
The company revealed at the time that it was operating at a loss of Rf320,000 (US$25,000) a day, while it faced losses in excess of Rf540 million (US$43 million) in 2008.
Moreover, it was revealed that the company had debts to the tune of US$18 million.
The government announced that the changes were part of its policy to stop providing over Rf100 million in annual subsidies to STELCO in favour of targeted subsidies.
But, in January, MPs of the ruling Maldivian Democratic Party (MDP) expressed concern that the average monthly electricity bill for households had risen almost overnight from Rf545 ($US42) to Rf725 ($US56).
The MPs called on the government to broaden its criteria for eligibility to ensure that more households would be receiving assistance.
“We have to get rid of this mentality that if a house hold electricity bill is high, they are well off,” urged MDP MP Eva Abdulla. “We have to assume that it might just be 12 people living in that household, chipping in for the bill – this is the reality.”
Under the revised rates, the price of the first hundred units consumed was up from Rf1.60 to Rf2.25, while the second and third hundred units had risen from Rf .70 and Rf2.15 to Rf2.50 each.
Earlier this week, the National Social Protection Agency (NSPA) announced that it would subsidise the fuel surchage in the electricity bill for low income families.
As part of the tariff restructure, STELCO decided to introduce a fuel surcharge of three laari for every eight laari increase in the price of diesel in the world market.
However, the surcharge would only be levied if the price of diesel exceeds Rf8 per litre.
Republican connection
Nihan said today that he doubted the validity of the procedure followed by NSPA to identify low income families.
He added that the municipality council was informed about the issue two weeks ago but no solution was found.
The MP for Vili-Maafanu further claimed that STELCO had a tank that could store fuel for three months and the reserves were purchased at “a cheap price”.
He called on all MDP MPs to join the protest tonight.
Meanwhile, Mohamed Zuhair, press secretary for the president office, claimed that the protest rally was connected to Gasim Ibrahim, business magnate and former presidential candidate of the Republican party.
Although Gasim backed the MDP in the runoff of the presidential election in exchange for posts in the coalition government, he quit as Home Minister 21 days into the new administration.
”You can see very clearly they are using Jumhoory [Republican] Party’s colour when DRP has their own colour,” Zuhair said. ”We have so far received a lot of information from local people that the rally is connected to Jumhoory party.”
Yellow standard
On the same day the DRP announced its protest, President Nasheed formed a task force to “assist and expedite” the provision of subsidies by NSPA.
Zuhair said the task force will monitor the awarding of subsidies and identify deserving recipients.
Meanwhile, Ibrahim Waheed, NSPA chairman, denied claims by DRP Vice-President Umar Naseer that subsidies were awarded exclusively to supporters of the ruling party.
Waheed said a DRP MP has been receiving subsidies from NSPA since January, but declined to reveal the identity of the opposition MP.
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Now i'm starting to understand why the press secretary is called 'Juhaa'. This guy talks more rubbish and immaturely than Mundhu. It's a shame anni has appointed such a person to his post.
Shame on you MP Eva. How could you say that to the poor Maldivians without any fact. You are shutting your eyes to the will of the Maldivians. You are elected to that chair to protect the rights of the Maldivians and to enable a better life to the Maldivians. The mass protest out in the street have proved how much Maldivians are disappointed with the governments decision to hiked prices.
Let the DRP and their allies have a go at running government. Let's see how much havoc they'll bring on this country.
If they do all the things they're promising, the country will be bankrupt in less than a month!
I suggest that President Nasheed call a mid-term election and let these morons into power. The country will be on its knees in no time! It won't be just electricity prices that'll rise. Hunger and thirst will rise faster! DRP will be ousted by hungry and angry citizens.
As per Zuhair's foolish analogy, even in Thailand its Jumuhooree Party protest because they also wear red shirt, what a nerd as press secretary
Amazing how Maldivians have forgotten the 30 years of tireny and the sufferings of the people. my personal experience, each night I sleep in fear of my husband being taken in to police. Now we have no fear of that, we can demonstrate and the opposition members are not imprisoned for treason like the type of sentences Jenny lateef suffered.
Golabo and cronies stole all the money and left MDP with what, a bloody bankrupt economy. Give this govt another year and see if they can bring their act together! of cause every one makes gross mistakes and one such is the Yameen joint pact!
nice post. thanks.
How a democratic transition can reverse overnight the corruption and mismanagement of 30 years of dictatorship. We all know that people are not fed by the government on which it has won the people.
But nothing has gone worse than the Qayoom’s era. Only one thing is changed for sure that people can express their hardship and feeling now which was a sin during the dictator’s period and we are thankful for Anni for this most valuable thing any human being can imagine “freedom” that we have now.
@Aishath
I have been living in this nation for 28 years. I have never been arrested neither tortured. I have even lived in different corners of the world and with people from different walks of life and I have observed that Maldives is one of the best spot in this earth to live unless you dont spread mischief in the land.
With regard to bankruptcy economy, these are false allegations that you MDP hypocrites spread. I heard from my own ears President Nasheed saying there wont be any problem for a government of MDP at all even if maumoon government does not have a single penny in its reserve. What are you people saying now.
Subsidies are important for a small nation like Maldives. IMF and World bank would always advice to make the economy 100 percent but it wont be possible for any government to take such measures. Look in to the case of greece, UK etc. UK needs over 20 billion to reconcile its deficit. However they are only able to cut down 2 billion. And on the other hand, lets see the worlds most thriving economy China. Government subsidized transport, housing, food etc., and its citizen receive a nominal salary. However, they have lots of disposable income as they have to spend less in those services.
I request DRP eadership to act more responsibly. Pass the tax bill first thing when parliament goes in action. Then please pass a bill demanding government to collect by force if required the hefty unpaid loans by senior politicians over the past 30 years. Can you dare do this. I am sure this will bring in sufficient funds for the government to manage the basic needs we are fighting for.
The pres secretary is no doubt a moron. He has lot of inside information that the protest is linked to Jumhoory party. But what a clever evidence he gave to back this claim. "they are wearing red". Moron.
What a great resource!
It is funny that people always compare Maldives with UK, USA, China and India. These are industrial countries that control the world economies. This reminds that how ignorant people are with the reality.
Probably these are the results of Qayoom’s 30 year of Darkness and false propaganda he used to manipulate people and kept people with imaginary hallucination.
How much a person can try to glorify Qayoom, the legacy of this man will remain as a person who ruled the country with iron fist to change the Maldives to his imagination, Maldives to become a rudimentary Arab culture. And he has succeeded on this. Now it is for Anni to change that to a modern society. But will be difficult task, probably impossible for him to do.
DRP and their coalition should accept @Beyya's challenge!
Pass taxation bill.
Demand government to collect (by force if required) the hefty unpaid loans by members of government, MP's, their relatives, politicians, their associates over the past 30 years.
The raw truth is: The reality of past is too dirty to be dug out!
But it also is too deep to be filled in at the expense of the middle class, the poor and the very poor.
Who will or can do what it takes!
I cannot think HEP is not capable to handle the situation, but the raw question of would he be allowed to do what ever it takes; hangs on balance!
@Andy
Here is what I suggest you do
a) Go and read an O'level economics text book
b) Read the National Statistics Figures published by the MMA (an independent institution which the MDP does not control)
Once you do these two things - you will realise that at the current level of spending the government's fiscal deficit will be in access of 25%. This would mean that we will be two or three times the level of debt in Greece. Thus - in order to maintain this level of spending - we need to print MRF like we did in 2007 and 2008.
There is an "easy" way out of this - and will probably be followed if the DRP were to come to power. This would be to devalue the MRF.
No doubt it would not affect the majority of those who really control the DRP because:
a) Majority of their leadership have USD accounts abroad
b) Their leadership has a loan in MRF - which when devalued would be worth less and therefore they would have to pay less
The economy is sick because of the excess of the previous regime. The cost of this has to be borne by the people - and the blame falls on the current regime.
So for those of you who are going out on the streets protesting against the MDP - I would advice you to first go and make sure you get as much USD as possible because if the DRP come to power - their only option would be to devalue the currency.
Since Maldives is entirely importer dependent country, devaluation of Mrf, will not affect, benefit or loss for any one. Once the devaluation is effected, the commodity price indictor will jump up automatically to adjust against dollar value. People will have to pay more Mrf for service and goods and deficit will be recovered. The Maldivian economy should be based on more like cooperative business type rather than any defined economic system.
@Saleem
You seems to be another deceptive MDP hooligan who trying to make MDP activists more gullible.
Have you ever reviewed the repercussions that face to small economies when such dramatic austerity measures are implemented. Do you have any glimpse of economic literature about such implication. For developed nations this wont be a matter as their basic needs are fulfilled by their governments. Lets take the case of UK, If people are unemployed they receive an allowance of equivalent MRF 10000.00 per month which is of a salary more than an average Maldivian, health service is offered free to all its citizen under the national insurance, housing is provided for the homeless free of charge and you are saying that for a nation like Maldives these kinds of immediate measures are compatible and we should be going back to the early 70's where poor people who are not affordable to the hiking prices should live with oil lamps to balance our book.
The fact is that IMF and neither world bank do not advice to do such a blunder. I agree to the fact that deficit is something which we need to sort. It needs to change its direction. However, this needs to be done in longterm by government subsidizing the cost that incur during this interim period and by increasing job prospects in the private sector. The reality is quite otherwise now. Private companies are in trepidation and are compelling them to decimate their costs by reducing staff to cope with the hiking costs. Investors have no confidence at all due to feeble stability in government policies.
ajmal,
the first part of ur statement says devaluation wont affect. The other part says prices will rise in terms of mrf. That is contradictory. What is this so called cooperative busines type? Anarcho-syndicalism? There is nothing stopping someone from starting up a cooperative even now.
Andy,
every government expense come from taxes (directly or indirectly) taken from the public who do productive work. There is no other way to finance a government. austerity measures could have been avoided if governent did manage its finances. When governent institutions are over staffed and under performing it is only a measure of time before it needs to be fixed. No amount of printing money will sustain it. Printing money (beyond the productivity of the economy) will result in inflation which is highly regressive tax affecting disproportionately badly on the poor.
And who is paying for the welfare state of the uk? Its their productive people with taxes. Same with scandinavian countries. Government can subsidise from only what it gets from taxes.
This is exactly the same whether it is big or small country.
Countries like greece are in debt precisely because their governent spent more than they can afford.