DRP party congress scheduled for April

Dhivehi Rayyithunge Party (DRP) has announced its party congress is to take place between April 23-25, local media has reported.

DRP Spokesperson Zeena Zahir told local media that the congress had initially been scheduled for March, but was later cancelled due to the unavailability of the Dharubaaruge conference centre.

“We will be able to conduct it [congress] next month. Male’ City Council has notified us with a letter that Dharubaaruge will be available for that date,” Zeena was quoted as saying in local media.

The party is to hold elections for two deputy leader positions, youth wing leaders and women’s wing leaders during the congress.


STO “quite sure” 17,000 tonne shipment of almost depleted building materials will arrive next month

The State Trading Organisation (STO) has announced that a 17,000 tonne shipment of aggregate and river sand will be imported to the Maldives in April.

The announcement follows recent concerns made by the company over its dwindling stocks of both materials, after India revoked its quota to export the material to the Maldives.

Managing Director of STO Shahid Ali told local media that the company is “quite sure” a 17,000 tonne shipment of aggregate and river sand will be brought in early next month.

Local media reported that the shipment will be coming from both Sri Lanka and Bangladesh.


Maldives facing worst economic situation in recent history: MMA Governor

The Maldives is facing its worst economic crisis in recent memory, the governor of the country’s central bank said earlier this week.

“The Maldives is now in a dangerous economic situation never before seen in recent history,” local media reported Governor of the Maldives Monetary Authority (MMA), Dr Fazeel Najeeb, as saying during a ‘Finance Forum’ held by the Pension Administration office on Bandos Island Resort.

“Expenditure in the country has exceeded income, and as a result the budget deficit is increasing. From November 2010 inflation has also been going up,” he said.

The country last year spent 63.1 percent of its GDP on state expenses, Dr Najeeb claimed, adding that only four countries had worse percentages, including Cuba and Zimbabwe.

Parliament’s Finance Committee revealed earlier this month that expected revenue for 2012 had plunged 23 percent – a shortfall of US$168.6 million, leaving the country with a budget deficit of 27 percent. Key unaccounted losses include up to US$135 million in land lease payments due to policy reinterpretation, and around US$8 million a quarter in airport concession fees due to a Civil Court ruling blocking the levying of an airport development charge.

Government spending for the year has meanwhile increased by almost 24 percent, to a total of US$1.13 billion. Spending unaccounted for in the 2012 budget following the controversial change of government of February 7 has included the promotion of a third of the police force, lump sum payments to military personnel, US$6.5 million in fishing subsidies, reimbursement of US$28.8 in civil servant salaries following cuts by the previous administration, the creation of two new ministries, and the hiring of international PR firms to counter negative publicity.

President Dr Mohamed Waheed Hassan meanwhile reported this week that India had granted the Maldives a US$25 million increase in credit facility, on top of a US$100 million facility extended in November 2011.

Figures from the MMA’s monthly economic review in April show projected GDP growth of 5.5 percent this year, down from 7.5 percent last year, but are drawn from the 2012 budget and do not account for the increase in expenditure highlighted by the Finance Committee.

However, “key indicators of the tourism sector showed declines as tourist arrivals fell in both monthly and annual terms during the month of March 2012. The decrease in arrivals mainly came from China although arrivals from Europe were also slightly lower,” the MMA noted, observing that tourist bed nights also declined.

The government said earlier this month it would hold industry consultations with the tourism sector as to how the additional revenue might be raised, and present recommendations from the International Monetary Fund (IMF), which included doubling the Tourism Goods and Services Tax (TGST) to 12 percent, according to Tourism Minister Ahmed Adheeb.

Minivan News spoke to several resort managers, who reacted poorly to the proposal.

“If we were to increase now, we’d – again – have to absorb all of it until new contracts with tour operators set in, some time in March 2013,” one manager told Minivan News.

“An increase on sales prices on the resort by way of adding on the GST – as any other increase – will be felt a lot more by resorts such as ours with a more price sensitive clientele, than by many of the upper market properties. How this will affect the country as a whole – rising prices, inflation, etc – and its effect also on tourism, is anybody’s guess,” the manager added.

The situation had led to a “feeling of insecurity” among many stakeholders in the industry, the manager said.

“Taxes, charges, rent-fees – nobody will dare a prediction for in two months from now let alone for next year,” he said. “This is not limited to possible financial burdens but is also true for other areas: infrastructure, industry projections, etc.”

Another resort manager said that any increase to the TGST, particularly if it was sudden, would have “serious ramifications on many of the markets.”

“Some operators will not accept the increase mid-contract and hence resorts will have to absorb this from revenue,” the manager explained. ”The additional costs will need to be balanced somewhere in the operation.”

The manager expressed frustration that resorts were being asked to shoulder the country’s financial burdens without any commitment from the government to reduce expenditure.

“We have seen an increase in some public services salaries and a reduction of working hours in many government departments who are meant to serve the resorts. Many of these government departments already make it difficult for the resorts to do their jobs, with bureaucracy and rules to keep extra people in a job rather than making it easier to support the resorts in order to do their job: build more business, increase revenue and hence increase GST [revenue] in a positive manner. An increase in GST right now is the wrong solution.”


Malé power cuts to continue till May 8: “Just no other option”, says STELCO

Scheduled power cuts in Malé are likely to continue till May 8 as the State Electric Company Ltd (STELCO) struggles to meet increased demand for electricity during the hottest month of the year.

Speaking to Minivan News, STELCO spokesperson Ibrahim Rauf said the company is only able to generate 35 megawatts of electricity per day at present, and faces a shortage of  2.5 megawatts.

The shortage is due to a delay in completing the fourth power project which will add two generators, each capable of producing eight megawatts of electricity, to the company’s functioning 17 generators.

The fourth power project was scheduled to be completed by December 2011, but will now be completed in May and generators will be running by May 8, Rauf said.

Hospitals and government offices will not face power outages, he added.

Meanwhile, Environment Minister Dr Mohamed Muiz has ordered all government offices to keep air conditioning at 25 degrees centigrade in order to reduce overloading STELCO, local media reported. The move could save one megawatt of electricity, an amount that can serve 300 households per day.

“We have to cut electricity because there’s just no other option,” Rauf told Minivan News. Malé has faced almost daily power outages throughout April.

Power interruptions would only last for an hour he said, adding that households can check when their buildings were likely to face outages on STELCO’s website.

“If households and businesses spread out use of electricity, for example, by doing ironing or operating heavy machinery at night or during weekends instead of during peak hours, the demand for electricity will decrease. Then we can reduce the frequency of power outages,” Rauf said.

He identified peak hours to be from 10:00am to 12:00pm, and from 1:30pm to 2:30 pm. Only Malé has been affected. The city’s suburbs Villingili and Hulhumalé and industrial island of Thilafushi will not be affected, Rauf said.

Lack of rain and increased temperatures in April also bring severe water crises annually to many islands in the Maldives. Maldives National Defense Forces (MNDF) have previously said over 60 islands have reported water shortages. MNDF is now providing desalinated water to these islands.

Telecomm provider Dhiraagu’s internet services were also interrupted this weekend due to damage sustained to an underwater submarine cable.

STELCO is a state company which provides electricity to 50 percent of the population. The company owns 23 powerhouses in 23 islands.