Tag: airport

Precious mangrove under threat as government plans airport in Kulhudhuffushi

Environmental NGO Ecocare has expressed concern that government proposals for an airport on Kulhudhuffushi island will result in the destruction of environmentally sensitive wetland areas.

“Though the constitution it self calls for sustainable development, it is sad and absurd when politicians care less about the vulnerability of Maldives and of its ecological diversity,” read an Ecocare press release.

Minister of State for Transport and Communication Mohamed Ibrahim today admitted that, should the proposed plan go ahead, there are few options but to encroach upon the island’s only remaining mangrove.

“We don’t have the details, but the new government plans to build an airport. We have prepared concept and have shared with the atoll council and the island council, and we are awaiting their comments,” said Ibrahim.

Ecocare stated that official enquiries into the specifics of the development had yet to yield any responses.

The group pointed out that – following the complete reclamation of the island’s southern mangrove for the construction of housing -the northern mangrove had been designated to be an environmentally protected zone.

Marine biologist with local environmental consultancy Seamarc, Sylvia Jagerroos, has explained the importance of such wetlands, describing them as “one of the most threatened ecosystems on earth”.

“Mangrove support the seabed meaning they prevent erosion on beachline and also enhance protection of the island in case of storm and higher sea levels,” she said.

“They support a nursery for fish and marine fauna and aid and the reef and seagrass in the food chain. The mangrove mud flats are also very important in the turnover of minerals and recycling.

Ecocare have also raised fears that the government plans to abrogate its constitutional responsibility to protect the environment as long as the proposed plans are termed ‘development’.

“Ecocare does not believe that this is a development proposal – this is just to honour a campaign pledge…it seems that he [President Abdulla Yameen] has asked authorities to get all of these promises done in 25 months,” said Ecocare’s Maeed M. Zahir.

State minister, Ibrahim, also referred to President Yameen’s August campaign pledge, in which he had suggested that the recently developed Hanimaadhoo airport – within the same area – was not enough for Kulhudhuffushi’s development.

At just just 16.6 km – or a thirty minute dhoni ride – from the new airport, Ecocare’s statement declared: “we cannot find reason whatsoever for the construction of an Airport in the Island of HDh. Kulhudhuffushi”.

Ibrahim declined to comment on the need for an additional regional airport.

Island divided

Ecocare’s Zahir suggested that most of Kulhudhuffushi’s residents were against the development, arguing that support for the proposal came largely from “party cadres” of President Yameen’s Progressive Party of Maldives.

“[Ecocare] has been made aware that there is a growing population of younger more environmentally sound locals who are opposing the idea of an airport,” Ecocare stated.

In contrast, however, Kulhudhuffushi North MP Abdul Ghafoor Moosa explained that a strong desire for economic development, alongside the government’s failure to promote the environmental case for preserving the wetlands, had resulted in strong local support for the plan.

“There are many many people who want the airport…My [parliamentary] election is a month ahead – my priority is to all people. Some of the people, they want to have the airport, so how can I comment against the airport,” said the opposition MP.

Asked about the potential for reclamation of the mangrove, Ghafoor suggested that economic imperatives would outweigh environmental.

“People are looking for the jobs and people are looking for better options,” he said. “Their concern is the airport so I am am also willing to have the airport.”

Ecocare’s Zahir suggested, however, aviation regulations make the development of a second airport in the region untenable, arguing that local development would be better served by improvements to the ferry network.

Ghafoor argued that, without significant government efforts to maintain the area, the mangroves were currently acting as breeding grounds for mosquitoes – furthering local indifference to the wetlands’ fate.

“So far, the government hasn’t brought [environmental importance] to public notice – through this muddy land, a lot of mosquitoes are coming. The government is not providing control and these things so people are suffering – when there is low tide, there is a lot of smell, due to the heat and all.”

The Maldivian Democratic Party MP suggested that a newly developed airport may only require the reclamation of 10-15 percent of the mangrove.

“Without my people surviving, how can my concern be on the environment?”

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Airport development begins, with “no chance” of GMR returning to project

The Maldives Airports Company Limited (MACL) has begun a program to further develop the airport, to be done in multiple phases.

Launching a program worth US$5 million to develop Ibrahim Nasir International Airport’s (INIA) ground handling on Thursday, MACL Managing Director ‘Bandhu’ Ibrahim Saleem revealed that various plans had been set in place for the development of INIA.

President Abdulla Yameen has today been quoted in Indian media as stating that any future management of the airport will not be carried out by foreign companies – with the Maldives government itself the preferred overseer.

Saleem told local media that, in addition to the introduction of new baggage tractors – launched during Thursday’s event – the company will also be introducing four new passenger carrier buses, heavy load vehicles for baggage carrying, a new baggage staircase and a mechanism to assist with boarding and unboarding patients with medical conditions within a period of 60 days.

He added that the projects are being conducted under the government’s 100 day policy implementation plans.

The record US$511 million development of the airport under Indian infrastructure giant GMR was prematurely terminated under the previous administration, prompting the filing of a US$1.4 billion arbitration case in Singapore.

Saleem explained that the ground handling equipment currently in use is old and damaged, which causes unnecessary delays in operations, assuring that the introduction of new equipment will allow passengers to observe a “remarkable improvement” in the speed of service.

“We are spending company money on these programs. We have not been able to purchase any such equipment since 2007,” he was quoted as saying.

Many projects underway

According to Saleem, the program is one among many development plans the company is undertaking.

Stating that the biggest challenge faced by the airport today is the issue of flight trafficking, he said that a permanent solution to overcrowding in the airport can only be found through the building of a second runway. He did, however, note that such a project would take a “tremendous amount of time”.

Adding that a review of the previously compiled Scottwilson development master plan of the airport would commence in the next two weeks, Saleem said that compiling such a plan anew would take around one year. He stated that global experts will be arriving within two weeks to assist in reviewing and updating the plans.

While the government is deliberating on undertaking such a project, said Saleem, reclaiming land and building a new runway would itself take at least two years to reach completion.

“Flyme is bringing in a new plane. Maldivian is also bringing in another new plane. So we need a runway upgrade at the airport as soon as possible. Nevertheless, it is not an easy thing to do,” he said.

The managing director added that, while these projects are pending, the airport is currently implementing smaller development projects immediately. As an example, he revealed that the construction of a new 35,000 square meter flight apron will be contracted to an external party in the next two weeks.

“We cannot do airport development in bits and pieces separately. It must be done all together. Once the Stockwilson plan is reviewed, we can begin the main work,” he said.

Saleem added that in 2014 itself, the airport traffic will increase immensely, and that the government will be focusing on reviewing the Stockwilson plan with a focus on connecting the airport to Malé.

GMR welcome to engage in other projects, not airport development: president

Meanwhile, President Abdulla Yameen has told Indian media that the Maldivian government is not even considering resuming the airport development contract with Indian infrastructure giant GMR.

While he repeated that the government is seeking an out of court settlement regarding the arbitration case concerning the cancellation of the GMR contract in the Waheed administration, Yameen said that the Maldives “had nothing against the GMR itself”.

“I am not saying we are saying no to GMR. What I am saying is total management of the airport is far too important for the Maldivian government (to hand over). We have nothing against GMR of any Indian company. It is just that the international airport is far too important for us, commercially and from a security point of view,” Yameen is quoted as saying to Indian publication The Hindu.

“The total operation of our airport will probably not go to any foreign party. Probably not even go to a Maldivian company. It will be undertaken by the MACL, a 100 percent government company,” he stated.

Yameen affirmed that deliberations of settling the GMR issue out of court has already begun, adding that the company is welcome to pursue other projects in the country.

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Comment: ‘Mega-loot’ – the murky and frightening sale of MACL

In my previous article in this column, I raised eight pertinent questions about the Waheed Government’s plan to sell 40 percent shares in MACL to Maldivian companies and individuals.

  1. Does the proposed sale maintain economic sovereignty or undermines it?
  2. Is the sale of MACL shares really an economic necessity in the current context?
  3. What is the reason why the sale has to be conducted within a span of 7 days?
  4. Why is there an absolute silence on the valuation of MACL shares?
  5. Does Waheed have any moral or constitutional authority to make this decision?
  6. Why is there absolute secrecy on issues such as the process to be followed for the sale?
  7. Is the timing of this transaction appropriate or is it designed to suit vested interests?
  8. Are we seeing a repeat of a series of shady transactions in the aviation space like Mamigili Airport lease extension and sale of Gan Airport to the Champa Group?

My conclusion based on a detailed review of each of these questions was that this proposed sale of MACL shares has all the elements of a big scam and that the Waheed government is going ahead with it brazenly.

Since then, the Privatisation Board has come out with a strongly-worded statement that the only prerogative to manage the privatisation process for government owned companies lies with itself.

Strangely, the board hasn’t even been contacted as yet for anything related to the proposed sale of MACL shares. Vice Chairperson of the Privatisation Board Mohamed Yasir quoted specific sections of the law that gives power to the privatisation board to decide on which companies to privatise, what should be the fair process, what should be the fair valuation as well as the process of establishing the same through an independent expert.

The above statements highlight the audacity of the attempt being made by Waheed government at this mega-loot. I have raised the question of Waheed’s moral and constitutional authority earlier. It now seems that that Waheed Government hasn’t even been acting within its legal authority on this issue. As per the process laid out in law, such privatisation of a government asset should be managed by the Privatization Board after getting Majlis approval for the same. I understand, based on discussions with people who are in the know of things that Waheed has set up a Special Committee headed by Azima Shakoor to manage the process for sale of MACL shares. In essence, rather than having the Privatisation Board and the Majlis take decisions and manage the process, it is the Special Committee headed by Azima Shakoor, Economic Committee of the cabinet and the MACL Board which have been asked to take decisions and manage the process. This is a constitutional transgression by an outgoing government, which certainly needs to be stopped in the tracks.

As a matter of fact, the ‘decision’ by Economic Committee of the cabinet is illegal to start with, since it is not authorised by law to make that decision and at best, they could have put forward a proposal to the board highlighting all the economic arguments and analysis in support of the proposal.

What is also most interesting to note here is the fact that an economic decision by the cabinet is not implemented by the Finance Minister but by the Attorney General, who is supposed to be the legal advisor to the government. So much so that the government’s Finance Minister doesn’t even have the authorisation to answer any questions related to this issue and he has been diverting all questions towards Azima Shakoor. It is not the Attorney General’s mandate to head committees which implement a major economic policy decision of the government. That the Attorney General is heading the committee also says a lot about what is going on – it clearly indicates that Waheed government’s focus is on ensuring that they get away with this sale without any legal hurdles rather than ensuring that government gets the right economic value for its asset.

It is difficult to understand the rush for selling MACL shares by a government that will have no constitutional validity three weeks from now. This level of urgency in selling off government assets may have been called for had we been in very severe economic trouble with an imminent risk of sovereign default or any other comparably dire situation. Fortunately for the Maldives, such a desperate situation hasn’t arisen as yet and this level of urgency behind the rushed sale process is certainly suspicious and needs to be investigated deeply.

Moreover, divesting a state asset is a significant economic policy decision. In most democratic countries across the world, and our democracy is modeled on principles from such stable democracies, there is a code of conduct put in place in light of a pending election. For example, as soon as the elections are announced in India, which is typically 6-8 weeks before the election date, a code of conduct comes in place which prohibits the government from making any new decisions or even undertaking activities such as laying foundation stones for projects! For these 6-8 weeks, the government in power is barred from making any new decisions and only has to focus on implementing the already ongoing initiatives. However, we have a case here where an out-going President is making and implementing a major economic policy decision one week before Presidential elections and only three weeks before he is certain to remit office.

As an unelected President, Waheed has made a number of significant economic decisions about our national assets in the last 1.5 years and has got them wrong, which will have a significant bearing on the country in the times to come. He allowed the sale of two seaplane operators to a single monopoly player but never cared to assess the implications of letting a critical part of Maldives’ tourism value chain be totally controlled by a single entity with now unchallenged power over the entire tourism sector. Much of the tourism industry has already highlighted how the sale of sea plane operations to a single monopoly player is posing an increasing threat to the viability of many resorts.

He also unilaterally cancelled the GMR concession agreement without caring to understand the potential future costs of the decision on future generations and the available trade-offs. Early indications are that the GMR arbitration is not going too well for Waheed government and we may potentially be looking at a huge claim from GMR by next year, which will ultimately have to be paid for by taxpayers like you and me.

He may no longer be the President in three weeks but he is doing all he can to make one final and the most outrageous raid on the Maldives exchequer to satisfy his and his cronies’ insatiable thirst for our national resources. All the early warning signals are there and enough alarms have been raised well in time for all the relevant independent institutions such as ACC, Privatisation Board and the Judiciary to take note of this mega-scam-in-the-making. It will be a significant failure of Maldivian institutions and even the Maldivian people if an unelected head of government is allowed to get away with this significant a loot, bypassing all the regulations and laws laid out in our constitution.

All comment pieces are the sole view of the author and do not reflect the editorial policy of Minivan News. If you would like to write an opinion piece, please send proposals to [email protected]

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Comment: Eight reasons why MACL’s share sale either doesn’t make sense, or is a giant scam

Mohamed Waheed’s government has been eyeing Ibrahim Nasir International Airport (INIA) just like a hawk circles around its prey before going for the kill.

Ever since MACL took over the airport from GMR, Waheed has been coming up with one scheme after the other to somehow move assets and ownership of INIA. Whenever such changes in ownership of valuable assets occur, a number of people invariably end up making a lot of money during the process.

First, he changed the MACL board and filled it with his political cronies in order to gain total control over the goings-on at INIA. Then, he tried to move all the assets of MACL into another company created through a secret Presidential decree so that it became a shell company, with all the value pulled into the new company.

This failed due to a number of legal issues. But now Waheed has now decided to sell shares in MACL to ‘Maldivian individuals and companies’ directly.

I will count eight reasons why I believe this proposed sale of MACL shares to ‘Maldivian companies and Maldivian individuals’ makes no sense and may potentially be a big scam-in-the-making.

1. Maintaining economic sovereignty or undermining it?

One reason Waheed’s spokesperson gave for this action was to “prevent foreigners from owning the airport in the future and protect the sovereignty of the airport”.

Essentially, rather than keeping control of MACL’s shares with it and hence ensuring the stated objective, it wants to sell these shares to third parties who can then go ahead and sell their holdings to foreigners. You can see the irony in the very argument that Waheed government is making for selling shares in MACL and wants us to lap up. Clearly, they believe that an average Maldivian on the street is silly and will happily agree to anything thrown his way as long as its wrapped with terms like ‘foreigner’, ‘sovereignty’ or ‘enslavement’.

On the contrary, by selling shares to Maldivian individuals and companies Waheed’s government is in fact opening doors for foreigners to actually go ahead and own INIA in the future.

Currently, the secondary financial markets in the Maldives are practically non-existent and it is easy for shares to change hands in off-market transactions. The regulatory framework for share sale & purchase is rudimentary and fails to ensure that equity shares of a company are not effectively transferred to a foreign entity. In fact, Waheed hailed the sale of two sea plane operators to American investment firm Blackstone as a shining example of how he has been able to bring investments into the Maldives. However, these transactions were an equity share sale of two businesses that are at the centre of Maldivian tourism, to foreign companies.

As a result of this share sale, significant control over Maldivian air space as well as businesses that are central to the health of Maldives tourism was given to an American investor. We have already heard of the problems most resorts are facing with the two sea plane operators and how they are being arm-twisted into signing long term agreements on unfavourable terms.

What will stop a foreign investor like Blackstone buying equity shares in MACL from a bunch of individual or large investors, and ultimately becoming the owner of INIA? In reality, it is this proposed sale of shares in MACL that is the start of potential ‘economic enslavement’ rather than a measure to stop the same in the future!

2. An economic necessity?

One argument that could have possibly been put forward by more aware and informed politicians would have been that this share sale is intended to plug the huge gap in the country’s financial position.

All of us know very well about the grave financial situation that the country and the government is in right now. After exhausting all of the recurrent expenditure budget for the year in the first four months, Waheed’s government has been relying on rolling over T-bills to finance its day-to-day expenses. However, it has already ruled out a supplementary budget for finance these expenditures and stated that it would continue to roll-over these T-bills in the short term. In this context, such a significant decision on divestment of state asset to private individuals is clearly neither a part of the government’s strategy to finance its projects and daily expenditures, nor an economic necessity in the current context.

3. All in the course of seven days

When Nasheed’s government privatised the airport, it put up the airport through an international bidding process managed by the World Bank’s International Finance Corporation (IFC). Work on the privatisation started in July 2009 and finished through announcement of the winning bidder in June 2010. Hence, it took 11 months for the previous government to complete a financial transaction related to the airport.

There were many allegations of corruption around the way the process was managed, which were later ridiculed by the Anti-Corruption Commission (ACC). Now, we have a situation where those who alleged financial irregularities in an 11-month long international bid process are looking to sell shares in the same company over the course of one week!

Even if one were to not compare this plan of share sale to local companies and individuals with the previous bidding process, a share sale like this typically takes more than a year for most companies to complete. Planning and execution of a public offering in most cases is a 6 to 12 month process at the minimum in most countries with well-developed regulations and mature financial markets.

However, here we have a case where an outgoing government wants to complete a public sale of shares of the most valuable national asset in a week. Quite clearly, there is much more to this share sale than meets the eye, which is why it may be important to finish the whole process in the blink of an eye.

4. Eerie silence on the valuation of shares or lack of it

Waheed’s government has given no indication at all of the proposed valuation of MACL and the price at which it is planning to sell the shares. Fair valuation of a share is a matter of opinion and a matter of sound professional judgement of bankers who typically assist with share sales. There are no investment banks in the Maldives who could assist with the sale of shares and no research houses which could come out with an investment report for the public to determine whether the determined price of MACL shares is fair value or not. If a share sale has to be conducted, such experts would typically have to be brought in from other countries such as India, Singapore and Malaysia which have developed financial markets.

GMR made a claim of US$1.4 billion for the loss of profits that it would have earned in the next 10 years, which it couldn’t due to the alleged illegal termination of its contract by Waheed government. Equity shares in MACL would entitle one to profits from INIA for the course of eternity. Hence, what we are looking at is a multi-billion dollar financial transaction – 40 percent of this is also going to represent hundreds of millions of dollars, if not billions.

In this context, the fact that no one in the government has made any statement about engaging an international bank or an expert to help determine the fair value of MACL shares is a clear giveaway. There has been no attempt to find out what would be the fair value of MACL shares, and the intention is to sell these to Maldivian companies and individuals in the matter of a week. One can only deduce from all this that the price (likely to be peanuts) and the buyers of MACL shares have already been decided, and what is proposed to be undertaken over the course of next is a likely to be big sham.

5. Waheed’s moral and constitutional authority to make this decision

Waheed’s term is coming to an end on  November 11 and as this column goes to press, efforts are still ongoing to ensure that a new President is put in power by then. Clearly, this is a significant economic policy decision which must be taken by the new President in line with his announced economic policy, based on which he would have been voted into power. Waheed was never voted into power and his manifesto was given a big thumbs-down in the first round election where he received only 5.13 percent of the votes. Clearly, he doesn’t have the moral authority to make such a significant economic policy decision one month before he is scheduled to hand over power to his successor.

As far as constitutional authority is concerned, your guess is as good as mine. With much larger constitutional questions open for debate today, I wouldn’t dare comment on this but I would certainly be surprised if it allows an outgoing President to make such significant economic decisions that have long term economic impact on the state of the nation.

6. A thick cloud of secrecy

What is most important is to understand whether he plans to bypass the Majlis for undertaking this transaction. It was Waheed and his current and former allies who raised their voices against how the GMR concession was awarded without Majlis approval. In fact, this is the legal reason that Azima Shakoor cited as the basis for declaring the GMR contract void ab-initio.

Now that the Waheed government wants to go ahead with share sale in MACL, has he sought or planned to seek Majlis approval for this? He doesn’t have majority in the Majlis now since DRP and MDP have joined hands and this proposal is likely to be shot down given the lack of any ground work as well as his own unpopularity with majority of the Majlis.

Leaving aside Majlis approval, it is not even clear if the majority of the MACL board has passed a resolution authorising any such sale or shares. There are only two statements made by members of the government till now in this regard – by Finance Minister Abdulla Jihad confirming that “40 percent of the shares will be sold to Maldivian public and Maldivian companies as soon as possible” and by the President’s Office confirming the intent of this sale in the next seven days.

MACL CEO Bandhu Saleem has deflected all questions to the Minister of Finance, who has in turn deflected all the detail related questions to the Attorney General. The Attorney General has not spoken on this in public till date, let alone answered any questions in this regard.

7. An ill-timed transaction that suits vested interests

The Maldives is burning today – literally so with Monday morning’s arson attack on the pro-opposition media house Raajje TV. Protests are taking place every day and every night on the streets of Male’ calling for elections as scheduled and for restoration of the basic constitutional right to vote. Credibility of the Supreme Court and other state institutions is under the scanner and the country is almost in a state of constitutional void.

Whichever way one looks, the political environment couldn’t have been more ill-suited for carrying out one of the most significant multi-million dollar economic transaction, of a public asset, in the history of the Maldives.

However, this is also the reason why it is the most suited for a malafide transaction since the national agenda is dominated by fears for the future of democracy. This provides the perfect opportunity for undertaking the most outrageous looting of a national asset and sweeping it under the carpet. Public memory is too short to remember this for long and too preoccupied right now to notice anything else.

8. More of the same game that has been played a few times over the last one and a half years

During Waheed’s tenure over the last 1.5 years, his Transport Minister signed a 99-year lease extension for Mamigili Airport in favour of his political boss Gasim Ibrahim. On the face of it, the minister was fired but the decision was never reversed. The loss that this ad-hoc extension may have caused to the exchequer was never quantified and never spoken about in public.

Under Waheed’s tenure, KASA Holdings owned by ‘Champa’ Afeef bought 30 percent of Addu International Airport for ~US$4 million, thereby valuing Gan Airport at close to US$13 million. This was a private transaction of a public asset and was done under utmost secrecy with news of the sale  given only afterwards in a press briefing by STO’s Managing Director Shahid Ali. There was no justification, no clarification and no questions asked or answered with respect to this private sale of a public asset. It is not even known till date whether the company was even valued higher than the scrap value of its assets.

A very rushed-up transaction, no discussion or record of economic merit, bypassing the Majlis and an eerie silence about the transaction until it is completed have all been fundamental to the modus-operandi till date.

Clearly, this sale of shares in MACL is more of the same game that has been played again and again under Waheed government.

Summing up, this is about to be the biggest looting ever done in the Maldives and it is happening right now in front our very own eyes, orchestrated by a man  none of us ever elected and 95 percent have rejected less than a month ago.

All comment pieces are the sole view of the author and do not reflect the editorial policy of Minivan News. If you would like to write an opinion piece, please send proposals to [email protected]

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MACL denies imminent strike action by air traffic controllers, as staff allege pay and safety concerns

Air traffic controllers in the Maldives say they are building up to a full work stoppage over ongoing grievances and safety concerns left unaddressed by the current government.

Such strikes could lead to delays and disruption of flights to the luxury tourism destination, that welcomes almost one million tourists a year.

Several controllers responsible for organising the strike explained to Minivan News that they have been raising safety concerns with all relevant government authorities following the restructuring of the state-owned Maldives Airports Company Limited (MACL). Despite countless promises, no action had been taken, they said.

“For the last six months we’ve been ‘going by the book’, following all the procedures which causes a lot of delays. In the aviation industry that is considered a mild strike,” the air traffic controllers explained.

The air traffic controllers are now “building towards a full strike”, and many are even now calling in sick to work, the sources said.

A full strike would involve notifying all the relevant regional and international agencies, airlines, and all relevant government agencies in the Maldives, because no planes will be able to land except for hospital and humanitarian aircraft.

“This strike affects everyone, sea planes as well. Whatever happens at Ibrahim Nasir International Airport (INIA) will cause delays at the domestic airports as well,” they added.

Six air traffic controllers should be on duty at all times, three in the control tower and three in area control, the sources said.

“Last night only two people showed up to work,” they confirmed.

“The [MACL] management and Maldives National Defence Force (MNDF) had to run the system last night,” the air traffic controllers claimed. “Management is totally stressed.”

“This morning only one person was working area control, so management has had to fill in and today at 1:00pm nobody one went into work,” the controllers stated.

As a result, MACL management is also trying to close the area control centre and combine all operations in the control tower, the sources said.

“A pilot from a domestic carrier called me today to say he’s hesitant to fly because the guy currently in the tower doesn’t know what he’s doing – it’s a big safety issue,” one of the controllers alleged.

Ground staff at Kaadedhdhoo domestic airport in Gaaf Dhaal Atoll told Minivan News that since strike activity began many domestic flights had been delayed “three or four hours” while a number of international flights coming into Male’ “have been diverted to Colombo”.

CEO of the Maldives Airports Corporation Limited (MACL), Ibrahim ‘Bandhu’ Saleem, told Minivan News no such strikes were occurring.

“As far as I’m concerned there is no strike – you are wrong,” said Saleem.

He explained that there have been no flight cancellations or delays at INIA and that “only Male’ international [airport], not domestic airports, are under my control.”

While Saleem insisted there is no strike, he noted “there are contingency plans in place [in the event of a strike].” He declined to answer further questions.

The air traffic controllers told Minivan News that while they were not aware of flights being cancelled as of early this afternoon, a flight from Dharavandhoo airport in Baa Atoll was one-and-a-half hours delayed this morning “because INIA couldn’t handle the air traffic.”

Safety and standards

The air traffic controllers claimed strike action was supported by 75 controllers – over 95 percent of the country’s qualified staff.  They are demanding the reinstatement of a professional grading system, adherence to International Civil Aviation Organisation (ICAO), and the holding of the presidential run-off election that remains suspended by the Supreme Court.

“This was not a political issue,” they emphasised. “But now because we’ve lost trust in and cannot negotiate with the current government, [the strike has taken a political direction],” the air traffic controller sources told Minivan News.

“We were counting on a new election and government so we could bring our problems to them. If there’s no election our grievances will be exacerbated. [Now] we don’t know when we’ll be able to vote and elect a new government,” the sources continued.

The controllers repeatedly emphasised that the Maldivian Air Traffic Controllers Association (MATCA) was not involved [in organising the strike], “because they don’t want this to appear a politically motivated thing.”

Concerns and demands

The air traffic controllers said staff were not getting proper breaks, domestic airports are understaffed, the radar system – installed at INIA in 2008 – does not meet ICAO standards, and the professional grading system for controllers had been abolished.

“Everyone got knocked down to the same grade one position, there have been no promotions or pay raises in four years,” the sources explained.

The professional grading system ranks experience level and qualifications, with four levels: 1) basic air traffic, 2) aerodrome (tower) controller, 3) approach controller, and 4) area controller. While the same task is performed at each level, the airspace area each controller is responsible for increases.

“If air traffic controllers are continuously stressed out they might get into trouble by losing a picture [on radar],” the sources warned. “More fatigue means more mistakes, but we can’t makes mistakes is this job.”

The sources said MACL staff from Male’ are sent to work the domestic airports. However, the majority of domestic airports are understaffed, with only one or two air traffic controllers. At least three people should be running the control tower at any given time, the sources explained.

“Where there is only one person working the tower – like in Forvumulah’s airport – that individual has to stay awake. He only gets four hours of sleep a day and has to work 30 days continuously without a day off,” they continued.

“If you are the only person on duty you cannot leave the room, it’s a safety issue,” the controllers explained.

Thimarafushi airport in Thaa Atoll has no air traffic controller, however the Civil Aviation Authority gave authorisation for the airport to operate anyway, the sources alleged.

“That’s totally fine by us, even in the US there is uncontrolled airspace. It’s not a big issue as long as the pilots feel that they can land and take off,” the sources added.

“No one to trust” in government

“The government is trying to say everything is running smoothly, while trying to buy us out,” alleged the air traffic controllers. “We also gave an interview to Haveeru yesterday but they nothing has been posted about it.”

“Minister Adheeb called us today asking us if we were on strike. He’s pretending he didn’t know that our concerns hadn’t been addressed, even though we met with him earlier this year,” the sources noted.

“Three supervisors – of eight total – went to the MACL Managing Director’s meeting today. He’s asking them to talk to us to bring us back to work,” the sources continued.

“We are professionals and don’t want to create chaos in the Maldives, but with the current situation there is no one to talk to,” they explained. “We’ve tried to do it in a democratic way and did every single thing [to resolve our grievances]. We’ve exhausted all resources. There is no one to trust,” they added.

“We have been trying to raise these problems – again – since 7 February  2012 with the current government run by [President Mohamed] Waheed, [Jumhooree Party Presidential Candidate and MP] Gasim [Ibrahim], and [Progressive Party of the Maldives Presidential Candidate and MP Abdulla] Yameen,” the sources continued. “They promised us action but didn’t take it.”

The air traffic controllers have additionally met with Vice President Waheed Dean, Defence Minister Mohamed Nazim, Tourism Minister Ahmed Adheeb, Transport Minister Ameen Ibrahim, MACL, the Civil Aviation Authority, and the Labour Relations Authority, “but nothing happened,” they explained.

Over a year ago air traffic controllers submitted a case to the Labour Tribunal signed by more than 40 individuals, the sources noted.

“On December 21, 2012, over 60 air traffic controllers signed a petition that gave notice that we would be going on strike. We were promised that by January 1 our grievances would be addressed, the grading structure would be re-implemented and we would receive proper raises,” the sources added.

The controllers agreed to withdraw the case when promised the reforms and did, however  the promised action was still not forthcoming.

“We met with MDP’s Mohamed Nasheed and he pledged that under his government he would correct the mistakes and try to get us better pay,” the controllers noted. “We [also recently] met with the other political parties, but so far nothing.”

“Some [of us] are waiting for confirmation in writing [that our demands will be met], but many are waiting for the Supreme Court to rule so we can have an election,” the sources continued. “We’ve heard that MACL ground services employees are also planning to strike.”

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Arbitration tribunal in GMR hearing agrees separate assessment of liability

The GMR-Malaysia Airports Holdings Berhad (GMR-MAHB) consortium has won an early legal skirmish in the Singapore-based arbitration hearings into its US$1.4 billion compensation claim for early termination of its contract by the Maldivian government.

GMR-MAHB won a concession agreement to manage and upgrade Ibrahim Nasir International Airport (INIA) under the Maldivian Democratic Party (MDP) administration, which was ousted from power on 7 February 2012 amid protests and a police mutiny.

The new government, comprising a coalition of former opposition parties under current President Mohamed Waheed, declared in late 2012 that GMR-MAHB’s agreement was ‘void ab initio’ (invalid from the outset) and gave the developer seven days’ notice to leave the country.

The US$511 million agreement was at the time the country’s single largest foreign investment. According to the government’s own engineering assessment, the development was 25 percent complete at the time GMR-MAHB was evicted.

The consortium has since lodged a US$1.4 billion claim with the Singapore Court of Arbitration, an amount eclipsing the Maldives’ annual state budget. The government is being represented by a Singapore National University Professor M. Sonarajam, while GMR-MAHB is being represented by former Chief Justice of the UK, Lord Nicholas Edison Phillips. The arbitrator is retired senior UK Judge, Lord Leonard Hubert Hoffman.

Latest hearings

During the second round of procedural hearings earlier this month, the tribunal acceded to GMR-MAHB’s request to split the proceedings into firstly determining liability, before quantifying the amount of compensation to be paid separately.

Minivan News understands that the tribunal agreed this would simplify examination and quantification of what was effectively three claims being made in the hearing: GMR-MAHB’s claim for compensation as per the termination clause of its concession agreement, its parallel claim for loss of profits over the lifespan of the agreement due to its termination, and the government’s counter-claim for restitution should the tribunal decide in its favour.

According to a source familiar with the matter, the government’s legal team opposed splitting the proceedings in such a fashion as they had not had access to GMR-MAHB’s documentation, and would therefore be unable to assess the scope of the claim at stake.

Minivan News understands that the tribunal rejected the government’s position on the grounds that it would be quicker, fairer and less costly to resolve the case by first determining liability for each of the claims, and then quantifying these.

Separate development paths

Local media has meanwhile reported that Maldives Airports Company Limited (MACL), which took over management of the airport following the government’s eviction of the foreign investor, has sought a US$150 million loan from Thailand’s Exim Bank for the construction of a new runway.

Sun Online reported MACL Managing Director Bandhu Saleem as stating that MACL’s three-year development project, involving reclamation of land for the runway and development of a new terminal, would cost a total of US$380 million.

“The terminal is being designed. The funding will be available in the next six months or so. We are planning to start the construction of the terminal as soon as the runway is completed,” Saleem reportedly told Sun.

Future development of the airport and fallout from the arbitration proceedings is likely to be affected by the upcoming election.

Of the four presidential candidates contesting the presidential election on September 7, both resort tycoon Gasim Ibrahim and incumbent President Mohamed Waheed have taken strongly nationalistic positions on MACL retaining full control (and responsibility for financing) the airport’s development.

Gasim’s running mate, Dr Hassan Saeed, was an early and emphatic proponent of GMR-MAHB’s eviction, previously issued a pamphlet calling for the cancellation of the agreement and likening it to “taking bitter medicine to cure a disease” or “amputating an organ to stop the spread of cancer.”

The Progressive Party of the Maldives (PPM), a major opponent of the MDP’s government’s signing of the concession agreement, has in recent months appeared to have taken a more conciliatory position, blaming the fallout of the agreement’s sudden cancellation on President Waheed.

“We told the next President Mr Waheed that he should hold discussions with the GMR Group and the Indian government to arrive at an acceptable solution, after which the government was free to act on its own,” PPM head and former Maldivian President Maumoon Abdul Gayoom told Indian media in June. “Unfortunately, this was not done and suddenly there was this unhappy ending.”

The MDP has meanwhile signalled that if elected, it intends to negotiate the return of the developer. Construction of the new terminal was originally pegged for completion by 2014.

“The coup government nullified the agreement, and we will see how best to rectify it,” former Economic Development Minister Mahmoud Razee told Minivan News.

“If need be we will go to the Majlis. Our objective is to get work restarted as quickly as possible,” he said.

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Comment: The unfortunate reality of an island airport

Milton Friedman, one of the most influential economists of 20th century, once said “If you put the federal government in charge of the Sahara Desert, in 5 years there’d be a shortage of sand”.

While it has been proved time and again that Governments have no business being in business, the issue is still widely debated and will probably linger on in eternity. However, in the Maldives, this issue of state ownership of businesses takes a totally different dimension. When Mr Friedman made this, now legendary, comment he referred to only the inefficiencies in decision making and economic management that most governments and politicians are riddled with. In the Maldivian context, one has to take into account the mala fide intent as well as narrow self-interests of people in the government as well.

An unfortunate example of how the Government of the day not only destroys value but systematically works against the interest of the people is our prized national asset – Ibrahim Nasir International Airport.

Caught in the middle of political wriggling and costly lawsuits, politicisation of the airport by everyone across the political spectrum and the mullahs typifies all that is wrong with our economy, our businesses and our government.

Ever since the ousting of GMR, whatever progress that had been made at the airport is now being undone – reversal of employees benefits such as employee insurance which was given by GMR to stalling of development works at the airport are just a few examples.

I have been told of way too many stories of flight delays due to systems outages, long unmanageable queues and leaking roofs to be convinced all over again of the Government’s inefficiencies in managing enterprises.

But I do not intend to focus on Government’s inefficiency in managing our national airport in this article. I would rather highlight the systematic manner in which the current Government seems to have taken control of the airport to serves its and its cronies’ own narrow self-interests rather than let it be run in a professional manner that is best for the passengers as well as the nation.

First, Dr Waheed’s government wanted to create a new airport company (MIAL) to take over management of Ibrahim Nasir International Airport with a new MD and a new Board of Directors with the intent of setting up tight control on the airport management. When the AG advised them of legal impossibilities related to this action, he appointed the same set of cronies to the MACL board to ensure he controls the board and all important commercial decisions at the airport.

Of course, at the time of cancelling the agreement, Government did say that new and professional management will be brought to manage the airport within 3 months and there will be no political influence in managing it going forward. Whatever happened to Dr Waheed’s ideas of ‘professional management’, Dr Hassan Saeed’s idea of ‘internationally experienced  foreign CEO and CFO’ and Sheikh Imran’s ‘national consultations for deciding the future of the airport’.

On political appointees and lack of professional management, it is interesting to note that Dr. Waheed’s political appointee as the MD of MACL– Bandhu Saleem has at least started making some noises around what are all the challenges that are facing the airport – lack of funds, no master plan and hardships & sacrifices for 3-4 years in each phase of airport’s development. He said these things in an interview to a local daily and what is most painful is that whatever he said only highlights the stupidity of the decision to oust GMR.

If it was that easy for a government company to get US$350 million funding for the airport, then why would anyone anywhere across the world privatise airports in the first place?

And by that logic, even Dr Waheed would have got his US$500 million loans from China and US$350 million grant from Saudi Arabia for budgetary support by now surely? As for the master plan for development, it was to be announced within 3 months of GMR’s ouster and we haven’t heard a word from anyone on this yet. There are bigger battles for all the politicians to fight, within themselves, in two months.

It’s clear by now that all these lofty promises always sound good to the general public and Bandhu Saleem’s game plan seems to be the same for now, even though reality it is most important to first take care of the basics. I have been told by sources that in one of the first meetings that he called after moving to his office at the airport, his authority was challenged and thwarted directly by the attendees. He intended to undertake frivolous discussions on the “Vision & Mission” for the airport when all the other attendees didn’t even have permanent contracts or medical insurance covers, something that they enjoyed under GMR management.

While airport’s development by MACL is an elusive dream that may never see the light of day, the fear really is that since it is back under MACL (effectively government) control, systematic corruption will rise like never before. What is most interesting for us to note is that all of these moves to take control of the airport operations come at a time when the Presidential elections race is heating up by the day.

Campaign funding is the need of the hour and we know that most elections are won or lost on the level of funding that is available to a candidate. With his allies deserting him thick and fast, what may still keep Dr Waheed in the hunt for the election is the money that his cronies are willing to bet on him while he is still in power.

It is well known that the likes of MVK Shafeeg and Najah have their eyes set on more airport concessions. MVK Shafeeg has been funding most of the anti-GMR protests and has been providing campaign funding aggressively to Dr. Waheed’s coalition.

So, I’ll not be surprised if we see MVK shops coming up in duty free section of the airport soon. A refurbished and world class duty free offering was one of the best things that GMR had done at the airport. MACL’s previous MD Mafooz had publicly stated that duty free is one of the best profit earners for the airport. It will only be in return for securing his campaign funding that Dr. Waheed’s government will allow MVK to get duty free shops at the airport for peanuts.

After all, securing massive amount of funds may be half the battle won in the presidential race of September 2013.  Whatever happens to the airport and its development after that can be put on the backburner like it had been for each of the last 25 years – except for the two when GMR managed it!

All comment pieces are the sole view of the author and do not reflect the editorial policy of Minivan News. If you would like to write an opinion piece, please send proposals to [email protected]

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President opens Maldives’ first Burger King

President Mohamed Waheed has opened the Maldives’ first Burger King, one of four international restaurant chains in Ibrahim Nasir International Airport (INIA)’s new food court.

Besides Burger King’s there are two restaurants on either side of the departure gates.  The new restaurants include ‘casual’ Thai eatery Thai Express, a Australian cafe chain selling mixed drinks and snacks called Coffee Club, and Swensen’s ice creamery, which has already been operating in the airport for several months.

The chains were introduced by the Minor Food Group, a Thai-based subsidiary of the Minor International hospitality and restaurant brands conglomerate that also operates six resort properties in the Maldives, including Anantara, Naladhu and the Per Aquum brands.

The new food court was originally planned as part of the temporary refurbishment of INIA during the construction of a new terminal by Indian infrastructure giant GMR, prior to the government’s controversial eviction of the firm in December 2012. The company recently claimed it is seeking compensation in a Singapore court of US$1.4 billion, an amount four times the size of the Maldives’ state reserves.

The official opening of Burger King and the other restaurants began this morning with the recitation of the Holy Quran, followed by speeches, ribbon cutting, and the serving of food to the many assembled government dignitaries and school students brought across from Male’ for the event.

A company spokesperson told Minivan News that the reception and performance of the burger chain in its first two days of operation had surpassed expectation, perhaps unsurprising given the anecdotal practice by some Male’ families of bringing McDonalds and KFC takeaway back with them on weekend flights from Colombo. Certainly Burger King was extremely popular with the assembled school students, who steadily worked their way through mountains of whopper burgers.

Minor International Chairman and CEO William Heinecke meanwhile noted that the food court improved the quality of the airport by providing a variety of international food demanded by tourists.

“President Waheed told me earlier that this airport is very special to him because as a student he helped carry the stones to make the runway,” Heinecke said.

President Waheed expressed confidence that food court was a sign the airport was developing into a “world class facility”, “and all this under the leadership of our Maldivian colleagues”.

“This is the first big project since the new management took over the airport,” the president said. “Inshallah soon we shall see major investment such as a new runway, which we are currently seeking financing for.”

The manager of one outlet meanwhile identified “consistency of supply” as a key operational challenge in the Maldives for strict branded outlets, noting that chains such as Burger King in particular had extremely high standards of brand consistency.

Employment culture

Several speakers predicted that the introduction of the Maldives’ first major multinational fast food chain could usher in the concept of part-time employment to the Maldives, particularly for students, and help combat widespread youth unemployment.

Of the food court’s initial 53 employees eight were Maldivians who had been sent to Thailand for training, Heinecke said, stating that one of the company’s goals would be to increase the extent of Maldivian employment, particularly part-time students.

Minor Food Group CEO Paul Kenny observed that the firm had success introducing the concept 20 years ago in Thailand. Part-time work, he said, could contribute greatly to an individual’s development.

President Waheed urged young Maldivians to seek work in the fast food outlets, noting that during his tenure as a student he had worked as a tutor “as my parents could not afford to pay me an allowance.”

He also expressed hope that an outlet would open in Male’, and that the price of burgers would eventually come down (regular value meals were around the US$10-12 mark at time of press).

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GMR compensation claim of US$1.4 billion eclipses annual state budget

Indian infrastructure giant GMR has filed a claim for US$1.4 billion in compensation from the Maldives, following the government’s sudden termination of its concession agreement to manage and upgrade Ibrahim Nasir International Airport (INIA).

According to Indian media, the 75 page claim for “wrongful termination” of the concession agreement includes payments to subcontractors and loss of profits over the lifespan of the 25 year agreement.

Both the government and the state-owned Maldives Airports Company Limited (MACL) will be invited to respond, with a final court order in the case expected in March 2014.

In separate Singapore-based arbitration proceedings one of the project’s lenders, Axis Bank, is also seeking payment of US$160 million for a loan guaranteed by the Maldivian Finance Ministry.

Axis Bank recently raised concerns with MACL and the government, after President Mohamed Waheed moved to create a state-owned airport company and transfer to it MACL’s management responsibilities.

The prospect of MACL’s assets being dissipated led Airports Council International (ACI), the global body representing the world’s airports, to advise its members to exercise caution before making any investment in the Maldives relating to INIA, warning of “legal and financial risks”.

The government subsequently dropped the attempt, after its Attorney General Aishath Bisham warned that President Waheed had exceeded his authority in appointing board members to the new entity.

The lead up to eviction

GMR, in consortium with Malaysia Airports, narrowly won the International Finance Corporation (IFC)-managed bid for the airport in 2010, and signed the agreement with MACL under the former government of Mohamed Nasheed

The then-opposition, including the Progressive Party of the Maldives (PPM), People’s Alliance (PA), Dhivehi Qaumee Party (DQP) and Adhaalath Party (AP), opposed the agreement primarily on nationalistic grounds, and alleged corruption in the bidding process.

Other concerns raised by the opposition at the time included the prospect of GMR allowing Israeli military aircraft to stop over in the Maldives and refuel “after bombing Arab countries”.

The DQP then filed a civil court case, managing to block the developer’s charging of an Airport Development Charge (ADC) stipulated in the concession agreement, on the grounds it was a tax and therefore required parliamentary approval.

Backing the concession agreement, the Nasheed government permitted the airport developer to deduct the ADC from its share of the revenue as a stopgap measure, while it sought to appeal.

However shortly afterwards the Nasheed government was deposed during February 7 2012’s controversial transfer of power, and the opposition parties assumed control of the government – and the prospect of paying GMR for the development of the airport.

The government received US$525,355 from the airport for the first quarter of 2012, compared to the US$8.7 million it was expecting, at time it was facing a crippling budget deficit, a foreign currency shortage, plummeting investor confidence, spiraling expenditure, and a drop off in foreign aid.

In the second quarter GMR presented MACL with a bill for US$1.5 million, and in the third quarter, US$2.2 million.

“The net result of this is that the Maldivian government now has to pay GMR for running the airport,” wrote DQP Leader and newly-appointed Special Advisor to President Mohamed Waheed, Dr Hassan Saeed, in a self-described “candid” letter to Indian Prime Minister Manmohan Singh.

A subsequent report by the government’s own Auditor General (AG) found concession revenue due the government had plummeted fourfold as a result of the court verdict sought by Saeed’s own party while it was in opposition.

According to the report, net concession revenue to the government had fallen to just US$6,058,848 in 2012, compared to US$25,424,877 in 2011.

Rather than appeal the Civil Court verdict obstructing the ADC, “The new government took the view that it would not be proper for it to intervene in the legal process for the benefit of a private concern,” the report noted, and instead, on April 19 2012, the informed the developer it was “retracting the previous agreement [to offset the ADC] on the grounds that the then Chairman of MACL did not have the approval of the MACL board to make the agreement.”

GMR asserted that this decision was a political event as defined within its concession agreement, and warned that this would amount to a breach of the agreement by the government.

“The government did not accept this argument,” noted the AG.

Seeking a way out of the agreement but wary of the heavy penalties in the termination clause, the government accused the World Bank’s IFC of “irresponsibility” and “negligence” in its conduct of the bidding process.

“The government must also consider how much money has to be paid back as compensation if terminating the agreement,” said Attorney General at the time, Azima Shukoor, during a prescient press conference in September 2012.

“It is clear to all of you that the Maldives financial and economic situation is at a critical level, and in this situation [termination] is not an easy thing to do,” Shukoor said.

In August 2012, with the new terminal and refurbishment 25 percent complete according to the government’s outside engineering assessment, the government ordered a halt to construction pending new ‘regulatory approvals’, and demanded a second runway not included in the original agreement.

GMR agreed to construct an emergency runway and proposed exempting Maldivian nationals from paying the ADC as a compromise. The company received no response to the offer.

Dr Hassan Saeed meanwhile issued a pamphlet calling for the cancellation of the agreement, likening it to “taking bitter medicine to cure a disease” or “amputating an organ to stop the spread of cancer.”

In his letter to Indian Prime Minister Manmohan Singh, dated September 19 2012 and obtained by Minivan News, Saeed further claimed that “GMR and India ‘bashing’ is becoming popular politics”, and warned that “as a result, “the Maldives is becoming fertile ground for nationalistic and extremist politicians.”

“I want to warn you now that there is a real danger that the current situation could create the opportunity for these extremist politicians to be elected to prominent positions, including the Presidency and Parliament on an anti-GMR and anti-India platform,” Saeed informed Singh.

Saeed went on to accuse GMR of extensive bribery, including the payment of “millions of dollars to buy MPs to get a parliamentary majority for the then ruling Maldivian Democratic Party”.

He claimed that “politicians and MPs who end up in GMR’s pocket keep silent but no one – with the exception of former President Nasheed and his key associates – have defended the indefensible GMR deal in public.”

Eviction

In late 2012 the government declared the concession agreement ‘void ab initio’ (invalid from the outset), and gave GMR seven days’ notice to leave the country.

The move swiftly followed the Singapore Supreme Court’s lifting of an injunction blocking MACL from taking over the airport pending arbitration proceedings, on the grounds the arbitration court had no jurisdiction to prevent the Maldives as a sovereign state from expropriating the airport.

The full verdict however did not exempt the government from compensation for this maneuver. In fact, according to the verdict document, Financial Controller for the Ministry of Finance Mohamed Ahmed “affirmed in an affidavit that the Maldives government would honour any valid and legitimate claim against it. He also stressed that the Maldives government had never defaulted on any of its payments.”

Moreover, lawyer representing MACL, Christopher Anand Daniel, “also accepted that if the arbitration tribunal found that the Appellants were wrong in their asserted case that the Concession Agreement was void ab initio and/or had been frustrated, but the Appellants had by then already gone ahead with the taking over of the airport, they would at least be liable to compensate the respondent for having expropriated the airport” (emphasis retained).

ACC exonerates airport deal

The Auditor General’s report acknowledged allegations of corruption in the deal, but finding the evidence “not conclusive on this point”, deferred to the judgement of the Anti-Corruption Commission (ACC).

That arrived on June 17, 2013, in the form of a 61 page investigative report that concluded that the bidding process was conducted fairly by the IFC, and that the GMR-MAHB consortium won the contract by proposing the highest net present value of the concession fee.

The ACC further concluded that the awarding of the contract did not contravene amendments brought to the Public Finance Act requiring parliamentary approval for such agreements.

Furthermore,  “Considering the situation (2008, 2009 and 2010) when the decision was made to privatise the Male’ International Airport,” the ACC’s calculations showed that MACL would make a profit of about US$254 million in 25 years if the airport was operated by the government-owned company.

Conversely, the government would receive about US$534 million in the same period from the GMR consortium if the airport was privatised, the ACC found.

Reactions

Following publication of the ACC’s report, the government has backed away from allegations of corruption and instead declared to evict the developer was made due to its impact on state finances.

“Back before the government took back control of the airport from GMR, the reason we gave was that the deal was bleeding the country’s economy. We were paying GMR to keep them here,” President’s Office Spokesperson Masood Imad told Minivan News last week.

Azima Shukoor meanwhile labelled ACC’s report “incomplete” and “lacking professionalism”, in an interview with local media.

“There’s no contradiction between the government’s decision and the ACC report. We never levelled any corruption charge in terminating the agreement,” said the former Attorney General, in an interview with local media.

“Did [the ACC] omit the factors deliberately or unknowingly or simply just overlooked them? But a lot of factors have been overlooked and omitted from the report. The state will suffer great losses because of it. Especially when the country is tied up in [arbitration proceedings],” Shukoor was reported as saying.

“The state did a thorough investigation of the contract, including what happened during and after the signing of the agreement. So the government’s legal position doesn’t and shouldn’t change due to the report. We made a very firm decision,” she said.

Speaking at a campaign rally on the island of Thimarafushi in Thaa Atoll, former President Nasheed observed that the figure sought by GMR as compensation amounted to more than the annual state budget of the Maldives.

“Even today in my view it is one of the most important duties of the People’s Majlis to renew the contract, find a way to hold discussions with the company over [renewal], and save the Maldives from the great misfortune our people are about to face,” he said.

Former President Maumoon Abdul Gayoom’s PPM have meanwhile laid the blame for the airport debacle on President Waheed, accusing him of “ignoring advice”.

“We told the next President Mr Waheed that he should hold discussions with the GMR Group and the Indian government to arrive at an acceptable solution, after which the government was free to act on its own,” he said. “Unfortunately, this was not done and suddenly there was this unhappy ending,” Gayoom was reported as saying in the Hindu, following a visit to India and a meeting with Prime Minister Singh.

Following the PPM’s apparent turnaround on the GMR issue, Parliamentary Group Leader of the Waheed-aligned Dhivehi Rayithunge Party, Dr Abdulla Mausoom, said it was in fact senior figures in the PPM who were among the most vocal supporters for terminating the GMR agreement.

“It is ironic that we are hearing these statements from the PPM, whose leader has been witnessed supporting rallies demanding the cancellation of the [GMR] agreement,” he said.

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