Businesses need an “economic tsar” or a “tyrant” to succeed, says President Yameen

An “economic tsar” or a “tyrant” is essential for a business to succeed, President Abdulla Yameen said at a ceremony held last night to celebrate local investment company Alia’s 50th anniversary.

While business decisions are made in boardrooms after considering social factors, President Yameen said economic decisions should be taken by “someone with an economic mindset.”

“Success for a business is to have an economic tsar or an economic tyrant leading it,” said Yameen, addressing Alia’s senior management.

Alia Group has remained successful for so long because it is a “strong family business,” Yameen suggested.

“There cannot be many owners in a business. Businesses will get suggestions from the board, but when it comes to decisions, if there is one person who makes the decisions, it is more efficient,” he added.

Alia – founded by the late Ali Abdulla, father of former first lady Laila Ibrahim – started out in the early 1960s as Alia carpentry, before expanding into the construction industry.

Ten years later, the company reached an agreement with Yamaha, and introduced the Yamaha outboard engine to the Maldives, still being widely used in the transportation industry.

President Yameen praised Ali Abdulla for his vision and forward thinking, adding that under his management Alia had transformed the construction industry whilst revolutionising sea transportation with the introduction of the Yamaha engine.

Economy and investments

Yameen went on to say that the government is aiming toward increasing the rate of economic growth in the Maldives.

“The GDP growth this year is estimated at eight percent or higher,” he said.

“This growth, when compared to other countries and our close neighbour’s sluggish two to three percent growth, is a very vibrant economic situation.”

Last year, the government enacted its its flagship Special Economic Zones (SEZs) Act, which President Yameen’s administration insists would attract large scale foreign direct investments.

While the government forecasts it will receive US$ 100 million as acquisition fees for the SEZs by August 2015, the opposition has criticised the lack of significant foreign investments despite assurances from the government.

Last night, Yameen said peace and stability in the Maldives together with the government’s policies would spark interest from potential foreign investors.

“If we are able to grab the attention of the investors, and with the current direction of the economy, there will be big infrastructure projects in the future,” said Yameen.

Such investments would provide opportunities for local construction companies and create employment opportunities for the youth, he said.

“Sovereign guarantee”

President Yameen last night reiterated the government’s pledge to provide sovereign guarantees on loans to develop new resorts, noting that that the tourism industry offers “lucrative” employment opportunities for youth.

The economy does not benefit if resort development on islands leased by the government remains stalled for eight or 12 years, Yameen said.

“The rent for the islands might go into MIRA [Maldives Inland Revenue Authority],” he continued.

“However, the opportunity cost of the eight years is much higher. Imagine the amount of dollars which would cumulate and roll through the resort if it had been developed.”

Last year, the cabinet’s economic council announced plans to remove import duty on construction material needed for the refurbishments of resorts, in order to stimulate resort development.

Correction: This article previously identified Alia’s founder as Ali Ibrahim. This is incorrect. Alia was founded by Ali Abdulla.

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