Tourism ministry seizes environment regulatory powers

The parliament has granted powers to the tourism ministry to authorise developments on resorts in a move critics say will weaken the environment protection regime, and pave the way for corruption.

Amendments to the tourism law passed today transfers to the tourism ministry the Environment Protection Agency’s (EPA) powers to evaluate environmental impact assessments (EIAs) and authorise projects such as land reclamation. The agency functions as an independent body under the environment ministry.

Voting on the bill submitted by government-aligned MP Mohamed Ismail took place amid continuing protests by opposition Maldivian Democratic Party (MDP) MPs.

It was passed with 41 votes in favour after Speaker Abdulla Maseeh Mohamed asked for a show of hands.

If the amendments are ratified, resorts will have to seek authorisation from the tourism ministry for any development that could “permanently alter” the island, plot of land, or lagoon’s environment. The ministry must evaluate an EIA report before issuing permission.

EPA permanent secretary Ajwad Musthafa told the economic affairs committee during its review of the legislation last week that “the independent checks and balances system will be lost” if the regulatory powers are transferred to the tourism ministry.

The move amounts to allowing the tourism ministry to “self-regulate,” he contended.

The EIA process is the “main instrument” of the environment protection regime and adheres to international best practices, he said, noting that the reports are prepared by independent and qualified consultants.

Ajwad also objected to transferring technical experts to the tourism ministry as the agency’s “institutional capacity” was built up over a long period.

EPA director Miruza Mohamed meanwhile warned that the move could reduce funding from international donors.

However, the ruling party says “making the services available under one roof would ease the burden on investors, speed up services, and improve investor confidence.”

The involvement of other ministries and institutions in regulating resorts hinders the tourism ministry and “lowers investor confidence”.

The new provisions state that “only the tourism ministry will have the authority” to conduct assessments and authorise development projects.

The tourism ministry will also have the power to impose fines not exceeding US$5 million for violations.

Transparency and accountability

Environmental NGO Ecocare warned that the move conflicts with the environment protection law – which requires the EPA to evaluate assessments – and could “pave the way for corruption”.

“Under this particular scenario we also feel that when EPA assess and evaluates EIA reports, it is a more transparent practice than leaving this to the Tourism Ministry, who carry out the evaluation and awarding of bids for tourist resorts,” Ecocare said in a press release today.

The current system put in place by the Environment Protection and Preservation Act includes checks and balances and assures transparency and accountability, Maeed Mohamed Zahir from Ecocare told Minivan News today.

With the changes to the law, an unscrupulous official at the tourism ministry can grant approval “regardless of the effect on the environment,” he said.

Opposition Maldivian Democratic Party (MDP) MP Fayyaz Ismail said at the committee last week that the tourism ministry presently “discriminates” in issuing and suspending operating licenses to resorts.

Fayyaz warned that officials could misuse the authority to approve development projects on resorts and selectively impose fines at whim.

MP Ali Fazad, a ruling Progressive Party of Maldives MP, also expressed concern with the amendments conflicting with the existing environment law as “two laws would have two [provisions] for the same thing”.

However, all ruling coalition MPs on the committee voted in favour of the bill and forwarded it to the parliament floor.

The law also introduces a new scheme to allow the extension of resort leases to 99 years for a lump sum payment of US$5 million.

The changes aim to incentivise investors, make it easier to obtain financing from international institutions, and increase revenue for the government.

To be eligible for a lease extension, a resort property must be operational with an existing lease period of 50 years and must not owe money to the government.

Under the current Tourism Act, the maximum lease period for resorts or hotels is 50 years. However, the constitution allows leases up to 99 years.


Former fisheries minister faces corruption charges over lease of Thun’bafushi to Champa Moosa

The Anti-Corruption Commission (ACC) has asked the Prosecutor General’s Office (PGO) to press corruption charges against former Fisheries and Agriculture Minister Abdulla Kamalludheen for alleged abuse of power to unduly benefit a third party.

The ACC said in a press statement on Wednesday (October 2) that Kamalludheen renewed the lease for Kaafu Thun’bafushi in November 2006 despite multiple violations of the agreement by the leaseholder – business magnate ‘Champa’ Mohamed Moosa.

Based on documents from the fisheries ministry and the former minister’s testimony, the ACC found that Kamalludheen was aware that dredging, construction of a seawall, and reclamation work was done in Thun’bafushi without either conducting an Environment Impact Assessment (EIA) or seeking authorisation from the government.

Moreover, the island was used without a lease agreement from August 2004 to November 2006, the ACC noted, after the agreement expired.

The initial agreement signed in August 1999 authorised the government to reclaim the island with 15 day’s notice if any clauses were violated.

The ACC found that Kamalludheen informed the President’s Office in 2004 that the ministry did not invoke the clause to terminate the agreement as the illegal actions could not be undone.

The former fisheries minister told ACC investigators that, as senior officials and staff from the ministry frequently visited the island, “it cannot be said that the work carried out in Thun’bafushi was done without the ministry’s knowledge”.

While Kamalludheen claimed that the decision to renew the lease was made following consultation with the President’s Office, the ACC contended that the minister had to bear responsibility for “losses to the state” due to his culpability or negligence.

Abdulla Kamalludheen served as fisheries minister and home minister in the cabinet of former President Maumoon Abdul Gayoom. He is currently a senior member of the Jumhooree Party (JP) and was involved in campaigning for JP presidential candidate, business tycoon Gasim Ibrahim.

“Environmental criminal”

In June 2011, the Environment Protection Agency (EPA) labelled Champa Moosa “an environmental criminal” and fined him the maximum penalty of MVR100 million (US$6.5 million) for irreversibly damaging the marine ecosystem around Thun’bafushi.

“This was originally a reef ecosystem with a small sand bank in the middle, but he has been dredging the island without any clearance and the changes are now irreversible,” EPA Director Ibrahim Naeem told Minivan News at the time.

After three surveys of the area, the EPA had assessed the damage as amounting to MVR2.2 billion (US$144.6 million), not including the impact of sedimentation from the dredging which can smother coral kilometres from the site.

A foreign consultant who was involved in surveying the island told Minivan News that the area “seems to have been used as a dumping ground.”

“There were what looked like hundreds of used car batteries, waste metals and oil drums leeching into the marine environment,” the consultant said.

Fine overturned

In November 2011, the Civil Court overturned the EPA’s MVR100 million fine on the grounds that the administrative action was not “lawful, procedurally fair, and expeditious” as required by article 43 of the constitution.

The judge ruled that the EPA had not given Champa Moosa adequate opportunities to respond to the allegations, which made the administrative procedure “unfair.”

Naeem however insisted that the EPA had given all necessary documents to Champa and that he had been given “more than enough time to prepare his appeal.”

Several days after Champa was issued the fine in June 2011, the then-Director General of the EPA Mohamed Zuhair suddenly resigned from the post, publicly stating on DhiTV – a private broadcaster owned by Champa – that his departure was due to “political interference” in the EPA’s fining of the tycoon.

Environment Minister Mohamed Aslam however claimed that Zuhair had decided to take a voluntary redundancy package three weeks before his sudden departure, which rendered him ineligible for the lump sum pay out.

“This is Champa building his court case by attempting to question the independence of the EPA,” Aslam alleged at the time, noting that as the EPA’s Director General, Zuhair’s signature was on all the correspondence with Champa, including the notice informing him of the fine.

Champa Mohamed Moosa with former President Gayoom
Champa Mohamed Moosa with former President Gayoom

Naeem meanwhile expressed surprise at Zuhair’s DhiTV appearance, noting that “[Zuhair] was the guy who signed the letter [fining Champa]. Why would he have done so if he was not happy about it?”

Zuhair’s sudden resignation following the fining meant he had forfeited his entitlement to the redundancy package he had applied for, Aslam noted.

“Thun’bafushi has been an issue long before we took office,” Aslam said, explaining that the previous administration had initially rented the island to Champa for MVR100 a year (US$6.40) under an agreement that stipulated that he “not do anything detrimental to the environment – he was allowed to grow trees and monitor the shifting of the islands. He was not allowed to reclaim or extend the island.”