Ibrahim Nasir International Airport (INIA) in Male’ has become the second duty free operator in the Asia Pacific region to sell a recently launched US$39,000 (MVR592,000) bottle of whisky, reflecting what one retailer said is the growing significance of the destination for providers of high-end luxury goods.
Earlier this month, resort chain Anantara announced it would be offering guests a limited edition elephant-harvested coffee – priced at US$1,100 per kilogram – to target high-end gourmet appeal.
While the sale and consumption of alcohol products outside of the country’s airport and resort properties is prohibited under local law, the Maldives National Chamber of Commerce and Industries (MNNCI) said there remained definite potential for local industry and crafts to profit in a market like INIA, despite the MNNCI’s “concerns” over the development.
According to the Moodie Report, an influential travel retail publication, one Chinese passenger travelling through INIA this month purchased the limited edition commemorative Balvenie Fifty whisky just nine days after it had gone on sale at the site. Only 88 bottles are said to have been produced.
“With the Maldives being a top luxury travel destination in the Indian Sub-Continent, we believe that Malé duty free can act as a gateway to the great collection of rare and vintage malts,” distiller William Grant and Sons’ Indian Sub-Continent Brand Development Manager Neeraj Sharma told the trade publication.
GMR, the Indian infrastructure group with a concession agreement to manage and develop the new airport terminal and retail facilities, has taken exclusive rights to certain duty free items to be sold at INIA.
However the GMR contract, which was drafted with assistance from International Finance Corporation (IFC), has come under intense criticism in the country’s political circles, with some key MPs and now government-aligned parties accusing the company of corruption and seeking to “enslave the nation and its economy”.
GMR has denied the charge, contending that it is contracted to operate as a caretaker for the site, which continues to remain Maldivian owned.
However, in the same week when INIA was selling the exclusive whisky to a passenger, local groups supporting a move to “re-nationalise” the airport continued to campaign to sway public opinion against the developer, releasing a large balloon in the capital adorned with the message “go home GMR”.
The government and GMR are presently involved in an arbitration case in Singapore concerning GMR’s levying of an airport development charge.
MNCCI Vice President Ishmael Asif said aside from selling exclusive duty free goods, local manufacturers of products such as wood carvings and traditional clothing could also benefit from operating in INIA. However, Asif stressed that local laws needed to be amended accordingly.
“There are no local laws right now protecting authentic Maldives products. The goods being sold as Maldivian often come from other countries and do not reflect our traditions and culture,” he claimed, pointing to the types of products sold in stores on busy retail streets like Chaandhanee Magu in Male’ as an example.
Asif claimed that legislation outlining quality and production standards could greatly boost the profitability and market for local techniques such as wood carvings of fish and dhonis (local boats) as well as smaller items like drums used in bodu beru – a local musical form combining rhythmic drumming and dancing.
According to the MNCCI, factories previously existed during the 1990’s specialising in such local woodworking techniques, which used paints and fabrics derived from local materials and colourings. Asif claimed that these factories were no longer in operation outside of some specialist operations supported by resorts based in Baa Atoll.
“We have been trying to work on a special logo that can be used to identify local Maldivian products, this is something that could be done and used at the airport,” said Asif.
The MNCCI added that in recent years, specialist retail groups had set up operations to try and provide authentic products to the country’s lucrative tourism trade, but had more recently struggled to maintain a property in the capital. The commerce group added that organisations such as the UN were now being sought to provide support to such enterprises to help maintain local cultural practices.
In terms of high-end luxury products, Asif added that traditionally INIA – formerly Male’ international Airport – had been viewed locally as a way to bring tourists to the country, rather than as a means of making money as a retail location.
“We are known [as a destination] for having expensive resorts, and the Maldives has tried to develop the best resorts in the world,” he claimed. “GMR seem to feel this is only a place for the elite, [while] we need to accommodate everyone.”
GMR said that as part of a redevelopment of the existing airport terminal, new restaurant properties providing fast food and Thai specialities – particularly popular with Maldivians – would be opened to both passengers and local people.
Yet despite the untapped retail potential for Maldivian products at INIA, the MNNCI said it held “concerns” over the airport agreement with GMR, which was signed with the previous government, and complained it had not been consulted about developing local retail potential.
Asif has previously said that the MNNCI held concerns about the impact of the GMR deal on local businesses, alleging that a planning council related to the infrastructure group’s bid had not been open to the public or its members.
He pointed to the case of local enterprises such as MVK Maldives Private Limited, which in December last year was ordered by the Civil Court to vacate the Alpha MVKB Duty Free shop based at INIA after its agreement had expired.
However, speaking to private broadcaster Raaje TV last month, former Economic Development Minister Mahmoud Razee, who worked with the previous government and international partners on the GMR agreement, denied the deal had resulted in local enterprises being kicked out.
“The privatisation policy does not itself kick others out. It is about honouring the contract. No one has actually been kicked out, but private parties have opportunities to participate. The issue that has always existed is getting cheap capital for small scale businesses,” he said at the time.
Razee claimed that the GMR deal reflected a commitment by the former government to pursue privatisation as outlined in the Maldivian Democratic Party’s (MDP’s) manifesto.
“Firstly, if or when anything is run like a business, private people are more skilled and efficient. They are far more competent and they work for profit unlike the government,” he claimed. “This means it requires less cost for the government, but needs more outside investment or capital. Private people are more skilled and efficient in terms of managing. The end product thus is more beneficial.”