Jumhoree Party (JP) Leader and MP for Alif Dhaal Maamigili, Gasim Ibrahim, has alleged corruption in the proposed sale of a stake in the Addu International Airport Company Ltd (AIA) to finance development of the Gan airport in Addu City.
The allegations were made in a six-page letter from the business magnate MP sent on Tuesday to President Dr Mohamed Waheed, which was leaked to local media last week.
The JP presidential candidate reportedly contended that the government had decided to sell a 30 percent stake in AIA to a local company named Kasa Holdings “without due consideration.”
‘Champa’ Hussain Afeef, tourism pioneer and business mogul, owns Kasa Holdings.
A consortium formed by the Maldives Airports Company Ltd (MACL), the State Trading Organisation (STO) and the Gan Airport Company meanwhile owns AIA.
AIA Managing Director Shahid Ali – also managing director of STO – confirmed to newspaper Haveeru in September that the AIA board of directors had decided to sell a 30 percent stake in AIA to Kasa Holdings for MVR60 million (US$3.9 million).
Shahid explained that Kasa Holdings and a Malaysian company had bid for the project following a public tender or announcement. He added that the Finance Ministry was consulted prior to the decision to sell the 30 percent stake.
Moreover, the bid announcement was made after the President’s Office approved the process, he said. However, the sale has been held up after the Transport Ministry asked the consortium to review the process and determine if the valuation was in line with the Public Finance Act.
Shahid said in September that AIA had requested legal advise from the Attorney General and that the government had not instructed the company on how to proceed.
Gasim meanwhile said in his letter that MVR60 million for 30 percent of AIA’s share was “a very small amount” as the value of the airport would be higher than MVR 3 billion (US$200 million).
Moreover, while US$44 million had been estimated as the cost of developing the airport, the JP MP claimed that the project could be completed with US$24 million.
An “open tender just in China alone” for the project would suffice to prove his assertion, Gasim wrote in his letter to Dr Waheed.
If the sale goes through, Gasim warned that Kasa Holdings would be positioned to acquire 70 percent of AIA by moving to sell 40 percent to a buyer of its choice.
“If a member representing the government does not attend a board meeting held to sell this 40 percent, Kasa Holdings will have the power to sell 40 percent of shares to whoever it pleases at whatever price it wants,” Gasim wrote. “In light of my experience on how these [deals] are completed, I have to say that the ultimate result would be the remaining unsold 40 percent being sold to a buyer of Kasa’s choice and the opening up of the opportunity for Kasa Holdings to control 70 percent, and within this opportunity, for [Kasa] to sell 51 or more percent of AIA to another foreign party.”
Gasim further contended that the move would pose a risk to national security, as the government would have no legal powers over the company.
Cancelling the agreement would mean paying the foreign party a “huge amount in compensation,” he claimed.
Gasim insisted that the Gan aiport should be developed by MACL and offered in his letter to reclaim land for the project free of charge “using my own dredger, employees and machinery with the government only providing oil.”
In October 2011, Gasim opened the Maldives’ first private airport at his native Maamigili with his ‘Flyme’ Villa airline landing the first flight in the new airport in Alif Dhaal atoll.
Gasim’s Jumhooree Party, part of the ruling coalition, is among parties calling for the nationalisation of the Ibrahim Nasir International Airport and cancellation of the previous administration’s concession agreement with Indian infrastructure giant GMR to develop and manage the Hulhule airport.