Tag: fisheries

Tourist arrivals increase 16 percent in April

Tourist arrivals in April increased 16 percent in annual terms, reaching 105,309 guests during the month, but declined marginally compared to March, according to the Maldives Monetary Authority’s (MMA) latest monthly economic review.

A total of 105,560 tourist arrivals were recorded during the previous month.

“The annual increase in arrival was contributed by the increase in the number of arrivals from Asia and Europe,” the review stated.

“In April 2014, total bednights rose by nine percent in annual terms while the average duration of stay declined by six percent. As for the occupancy rate, it increased to 80 percent in April 2014 from 75 percent in April 2013, as the impact of the increase in bednights was greater than the increase in operational bed capacity of the industry during the review month.”

The central bank had explained in its monthly review for March that the annual increase in tourist arrivals was due to the rise in the number of Chinese tourists, “which offset the decline in arrivals from Europe.”

According to statistics from the Tourism Ministry for the first quarter of 2014, Europe retained the largest market share despite the continuing growth of the Chinese market, accounting for of 51.3 percent of all arrivals to the Maldives.

Asia and the Pacific recorded a growth rate of 24.4 percent at the end of first quarter, bringing in an additional 26,606 tourists to reach a total of 135,839.

The region accounted for 42.2 percent of arrivals to the Maldives at the end of first quarter of 2014.

The Chinese market also expanded by 24 percent with an additional 16,960 tourists compared with the same period of 2013.

A total of 331,719 Chinese tourists visited the Maldives last year, which was a 44.5 percent increase from the previous year.

Chinese tourists accounted for 29.5 percent of all tourist arrivals in 2013.

The Maldivian economy is largely dependent on tourism, which accounted for 28 percent of GDP on average in the past five years, and generated 38 percent of government revenue in 2012.

Real GDP growth is meanwhile expected to accelerate to 4.5 percent in 2014, “driven mainly by the tourism sector” while “economic activity is also expected to be spurred by the government budgeted expenditure of MVR16.4 billion.”

Inflation

The rate of inflation in the capital Malé – measured by the annual percentage change in the Consumer Price Index (CPI) – reached 2.6 percent in April, up from 2.3 percent the previous month.

The inflation rate in February 2014 was 3.4 percent.

“This was largely contributed by the pick up in the growth of food prices, especially fish, and also due to the moderate growth in rent prices and cost of health services,” the review explained.

“On monthly terms, the rate of inflation increased from -0.5 percent in March 2014 to 0.3 percent in April 2014, which was mainly due to the growth in fish prices.”

The International Monetary Fund (IMF) commodity price index meanwhile registered an increase of one percent in monthly terms and three percent in annual terms in April.

“The monthly increase was mainly due to the increase in prices of petroleum, food and metal prices. As for the annual increase, it was due to the increase in food and petroleum prices as metal prices fell during the review period.”

“The price of crude oil increased by one percent in monthly terms and by six percent in annual terms to US$104.9 per barrel at the end of April 2014,” the review stated.

Gross international reserves meanwhile grew by 24 percent in April compared to the same period last year, reaching US$434.8 million by the end of the month. The gross reserves however declined by 13 percent in April in monthly terms.

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Slippages in revenue or expenditure will undermine debt sustainability: MMA macroeconomic report

Shortfalls in revenue or overruns in expenditure in 2014 “will undermine medium-term debt sustainability” and adversely affect the exchange rate and prices, the Maldives Monetary Authority (MMA) has cautioned in a report on macroeconomic developments in 2013.

On the outlook for the economy in 2014, the report released this week noted that the fiscal deficit was projected to decline to 3.2 percent this year from 4.7 percent in 2013 on the back of higher revenue from tourism-related taxes and payments for resort lease extensions as well as rationalisation of subsidies.

“Despite this positive outlook, there is a considerable amount of uncertainty surrounding the 2014 budget. Overruns in current expenditure will most likely lead to financing difficulties for the government or further crowding out of the private sector,” the central bank warned.

“Any setback to fiscal consolidation either due to slippages in revenue or current expenditure will undermine medium-term debt sustainability and will have adverse implications for exchange rate and prices.”

Outlook for 2014

Economic growth in 2014 is projected at 4.5 percent, an increase of 0.8 percent from the previous year.

“Growth will be driven by the continued expansion of tourism activity which is to be mainly supported by the robust growth of Chinese tourists,” the report explained.

“In 2014, growth is also expected to benefit from the recovery of construction sector which registered declines in the past two years. Activity in the construction sector is expected to recover due to the easing of material shortages and the continued expansion of residential construction projects amid improved bank credit to the sector.”

While the transport and communication sectors are expected to grow “in tandem with better prospects for the tourism industry,” the report noted that primary fishing activity is projected to decline slightly.

Inflation is expected to “remain moderate” in 2014, which “largely reflects the weaker outlook for global commodity prices”.

However, lower commodity prices were expected to “offset the upward impact of one-off factors such as the introduction of GST on communication services and reversal of import duty for certain goods during the year.”

The current account deficit is expected to widen by 16 percent to US$269.9 million this year as “improved receipts from tourism is insufficient to off set the increase in imports, interest payments and remittance outflows.”

While imports are expected to grow “in line with the projected increase in economic activity from tourism, construction and government sectors,” exports are expected to decline on account of a projected decrease in fish catch and global tuna prices.

“Meanwhile, gross international reserves are projected to improve in 2014 mainly due to inflows from the planned new revenue measures stemming from the tourism sector. In line with this improvement, reserves in terms of months of imports, are also projected to increase slightly,” the report stated.

Revenue and expenditure

While total revenue excluding grants reached MVR11.5 billion (US$745 million) last year – an increase of 18 percent from the previous year – revenue collection was lower than anticipated “owing to delays in the implementation of the planned new revenue raising measures as envisaged under the budget.”

Tax revenue accounted for 75 percent of total revenue in 2013 while non-tax revenue “declined marginally” to MVR2.8 billion (US$181 million).

Total government expenditure in 2013 was MVR13.5 billion (US$875 million), which was four percent below the target.

The report explained that capital expenditure was significantly lower than expect, “which offset sizeable overruns in current expenditure.”

“Meanwhile, although the government repaid some of the unpaid bills from previous years, a further build-up of arrears took place in 2013 as well and if these are considered total expenditure for 2013 will be much higher than estimated,” the report stated.

Current expenditure accounted for 84 percent of total government spending in 2013, reaching MVR11.4 billion (US$739 million), which was 11 percent in excess of the budgeted amount.

Salaries and allowances contributed the largest share at 48 percent of current expenditure, “reflecting the bulky public sector,” followed by subsidies and social welfare contributions at 18 percent, administrative costs at 13 percent, and interest payments at eight percent.

As large debt repayments were made between December 2012 and February 2013, interest payments in 2013 declined by 19 percent compared to the previous year and stood at MVR893.6 million (US$57.9 million).

Debt and deficit

As a result of “slippages in both revenue and expenditure” in 2013, the fiscal deficit is currently estimated at 4.7 percent of GDP, down from 9.2 percent in 2012.

The budgeted target for 2013 was however 3.6 percent.

The report noted that total debt of the government reached 78 percent of GDP at the end of 2013 as a consequence of “the sustained high budget deficit” over the past years.

Domestic debt accounted for 58 percent of total public and publicly-guaranteed debt.

“In 2013, the financing requirement of the government was met almost entirely through domestic sources: mainly through the issuance of Treasury bills (T-bills) to the domestic market and monetisation,” the report explained.

Net credit to the government by the MMA “increased from MVR4.7 billion at the end of 2012 to MVR6.0 billion at the end of 2013,” the report revealed.

The total outstanding stock of T-bills meanwhile reached MVR8.2 billion by the end of 2013.

“A large part of this increase was attributable to the increase in investments by other financial corporations and public non-financial corporations, which can be seen from the increase in their share of holdings (as a percent of total outstanding T-bills) from 28% at the end of 2012 to 44% at the end of 2013,” the report stated.

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Tourist arrivals rose six percent in February

Tourist arrivals in February increased by five percent from the previous month and six percent in annual terms, according to the Maldives Monetary Authority’s (MMA) latest monthly economic review.

“The annual increase was due to the rise in the number of arrivals from Asia and Europe,” the central bank’s monthly report noted.

While total bed nights in February rose five percent compared to the same period last year, the occupancy rate rose three percent from February 2013 to 89 percent this year.

The average duration of stay however “declined marginally in annual terms during the review period,” the report stated.

The MMA had previously revealed that tourist arrivals rose 17 percent in 2013 compared to the previous year “mainly due to the large increase in tourist arrivals from China, coupled with a slight growth in arrivals from Europe.”

Statistics from the Tourism Ministry show that 331,719 Chinese tourists visited the Maldives last year, which was a 44.5 percent increase from the previous year.

Chinese tourists accounted for 29.5 percent of all tourist arrivals in 2013.

In November 2013, the Finance Ministry revealed that the tourism industry’s GDP growth in 2012 declined by 0.1 percent following 15.8 percent growth in 2010 and 9.2 percent in 2011.

Despite negative growth in 2012, the Finance Ministry estimated that the industry would have expanded 5.5 percent in 2013 and forecast a growth rate of 5.2 percent for this year.

The average duration of stay has however fallen from 8.6 days in 2009 to 6.7 days in 2012, and 6.3 days in 2013.

According to the annual tourism yearbook published by the Tourism Ministry, the average occupancy rate of all tourist establishments in 2012 was 2.5 percent below the previous year at 70.6 percent.

The Maldivian economy is largely dependent on tourism, which accounted for 28 percent of GDP on average in the past five years, and generated 38 percent of government revenue in 2012.

Meanwhile, in the second largest industry, the volume of fish exports increased by nine percent in February compared to the previous year “largely contributed by the increase in the volume of fresh, chilled or frozen tuna exports.”

“However, earnings from fish exports declined by 25 percent during the same period, due to the fall in both the volume and earnings from canned or pouched tuna exports,” the review revealed.

“Additionally, earnings from yellow fin tuna exports also declined during this period compared to 2013.”

The rate of inflation – measured by the annual percentage change in the consumer price index in Malé – rose to 3.4 percent in February from 2.6 percent in January.

“This was largely due to the increase in fish prices,” the report explained.

“Similarly, the rate of inflation increased in monthly terms during February 2014, which was also due to the rise in fish prices.”

Public finance

The economic review noted that government expenditure “more than doubled” in January to MVR1.9 billion compared to the same period last year.

Total revenue fell by 11 percent to MVR1 billion “largely due to the 27 percent decline in business profit tax (BPT) [receipts].”

“Additionally, non-tax revenue also fell, owing to the significant decline in resort lease rent. As for the increase in expenditure, it was mainly due to the increase in subsidy payments,” the report stated.

As a result of “increased investments in T-bills by commercial banks, other financial corporations and public non-financial corporations,” the review noted that the total outstanding stock of government securities – treasury bills and bonds – rose nine percent in annual terms and 10 percent in monthly terms during February.

The trade deficit meanwhile narrowed by 29 percent during February compared to the previous year.

“This was due to the significant decline of 26 percent in imports which off set the 16 percent decline in exports. The decline in imports was contributed by the fall in petroleum products,” the report explained.

“Gross international reserves increased in both monthly and annual terms by 2 percent and 13 percent respectively and reached US$391.1 million at the end of February 2014. Reserves in terms of months of imports also rose in both monthly and annual terms to 2.7 months at the end of the same period.”

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Fisheries minister reveals details of fishermen’s allowance

The Ministry of Fisheries and Agriculture has compiled procedures under which fishermen can apply for the government’s scheme for an allowance of MVR10,000 (USD 649) for fishermen during lean months.

Provision of MVR10,000 to fishermen ‘regardless of catch’ was a campaign pledge of the ruling Progressive Party of Maldives (PPM) during the 2013 presidential elections.

Speaking at a press conference held on Sunday, Minister of Fisheries and Agriculture Dr Mohamed Shainee stated that the scheme will commence from Tuesday, April 1.

“The objective of this scheme is to further aid the fisheries industry to become a main pillar in strengthening the country’s economy. We are trying to give support and assurance to fishermen that they can maintain their careers in fishing,” Shainee stated.

“More than a form of social protection, this scheme is more a means to further develop the fisheries industry economically. Through this scheme, we are assuring an income for the fishermen”.

The minister stated that only tuna and yellowfin tuna fishermen are eligible to participate in the scheme during its initial stages.

“However, we are at the moment unable to include other forms as we do not have the statistics on how much they generally earn. Nevertheless, other fishermen will also be able to participate in the scheme,” Shainee added.

Under the newly comprised procedures, the ministry categorised tuna and yellow fin tuna fishing vessels into three categories: vessels smaller than 45 feet in length, vessels between 45 and 65 feet in length, and vessels larger than 65 feet in length.

Under the scheme, fishermen working on vessels smaller than 45 feet in length are to get an allowance of MVR3500 (US$227) in return for a monthly premium of MVR350 (US$23) paid to the state.

Fishermen working on vessels between 45 and 65 feet in size are eligible to receive an allowance of MVR5000 (US$324), while needing to pay a monthly premium of MVR400 (US$26).

Those working on larger vessels – over 65 feet in length – will be given the full allowance of MVR10,000 (US$649), and are required to pay a premium of MVR500 (US$32).

The premium fees are to be paid up front for a year in order to participate in the scheme. The minister stated that the government is working to arrange the receipt of payments through island councils.

“As over 90 percent of Maldivian fishermen work in vessels of over 65 feet in size, we have targeted the full amount of MVR 10,000 for them,” Shainee told press today.

“However, this government has not neglected any fisherman. By this I mean that, although our pledge says MVR10,000 for fishermen on all lean months, we have made the scheme inclusive of even the remaining 10 percent of fishermen,” Shainee explained.

Minister Shainee expressed confidence that the scheme would encourage fishermen to engage in fishing even during the lean months.

It was further revealed that discussions are currently being held to hand over the management of the scheme to the National Social Protection Agency.

It was noted that 722 fishing vessels are currently in the state registry, while 11,894 fishermen are registered as working on these vessels – only 5 percent of them are listed as working on vessels less than 45 feet in length.

According to the ministry, over 80 percent of the registered fishermen work on vessels larger than 65 feet in length. In a previous interview with Minivan News, Dr Shainee had noted that encouraging fishermen to use for economically sized vessels would improve the industry’s profitability.

On Saturday, President Abdulla Yameen revealed at a political rally that application forms for the scheme will be available from April 1 onwards. He further stated that the allowance will be released to fishermen before the end of May.

Yameen further revealed that discussions are being held between the State Trading Organisation (STO) and the Indian government to arrange the supply of petroleum products at a lower price.

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Tourist arrivals rose 17 percent in 2013

Tourist arrivals to the Maldives rose 17 percent in 2013 compared to the previous year, according to the latest Maldives Monetary Authority (MMA) monthly economic review.

“This was mainly due to the large increase in tourist arrivals from China, coupled with a slight growth in arrivals from Europe. Reflecting this, the total bednights and occupancy rate also recorded an increase during the year,” the MMA’s review stated.

The review did note, however, that the average duration of stay declined in 2013 compared with the year before.

Statistics from the tourism ministry show that 331,719 Chinese tourists visited the Maldives last year, which was a 44.5 percent increase from the previous year.

Chinese tourists accounted for 29.5 percent of all tourist arrivals in 2013.

The central bank also noted that real GDP (Gross Domestic Product) was expected to “accelerate to 4.5 percent in 2014, driven mainly by the tourism sector.”

In November 2013, the finance ministry revealed that the tourism industry’s GDP growth in 2012 declined by 0.1 percent following 15.8 percent growth in 2010 and 9.2 percent in 2011.

Despite negative growth in 2012, the finance ministry estimated that the industry would have expanded 5.5 percent in 2013 and forecast a growth rate of 5.2 percent for this year.

The average duration of stay has however fallen from 8.6 days in 2009 to 6.7 days in 2012 and 6.3 days in 2013.

According to the annual tourism yearbook published by the Tourism Ministry, the average occupancy rate of all tourist establishments in 2012 was 2.5 percent below the previous year at 70.6 percent.

The Maldivian economy is largely dependent on tourism, which accounted for 28 percent of GDP on average in the past five years, and generated 38 percent of government revenue in 2012.

Meanwhile, in the fisheries industry – the second largest domestic industry – “the volume of fish exports increased by 48 percent while the earnings on fish exports rose by 14 percent” between January and November 2013 compared to the same period in 2012.

“This was contributed by the increase in both the volume and earnings on fresh, chilled or frozen tuna,” the MMA report stated.

It added that fish purchases rose by 21 percent from January to September 2013 compared to the same period the previous year.

Inflation

The monthly review noted that the International Monetary Fund (IMF) commodity price index increased by two percent in monthly terms during December 2013.

“This increase was due to the rise in food, metal and petroleum prices in the review period. In annual terms the IMF commodity price index increased by one percent, contributed by the increase in petroleum prices which off set the price declines in food and metal.The price of crude oil increased by three percent in monthly terms during December 2013, while prices rose by six percent in annual terms,” the review stated.

The rate of inflation in the capital Malé meanwhile decreased to 3.1 percent in December 2013, the MMA revealed, which was “largely due to the fall in fish prices.”

“Similarly, the rate of inflation in Male’ decelerated  marginally in monthly terms during December 2013, which was also due to the fall in fish prices,” the review stated.

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Local fish exporters reduce price paid for catch

Local fish exporters have this week announced that they will be reducing the price paid to fisherman following a drop in global fish prices.

Horizon Fisheries, Koodoo Fisheries Maldives Ltd (KFML), Felivaru Fisheries and MIFCO have all reduced fish buying prices, telling local media that the price would increase along with global market prices.

Global fish prices are reported by local media to have dropped from US$2500 to US$1850, with Maldivian fishermen now receiving MVR18 per kg of fresh fish with ice, and MVR16 per kg without.

Ibrahim Manik of the Fisherman’s Union has suggested that leading government figures are amongst the country’s largest fish exporters.

“The senior officials of the PPM administration are fish exporters. Gasim’s Jumhooree Party and Yameen’s PPM’s [Progressive Party of Maldives] Zameer are fish exporters. As they make profits fishermen are facing a lot of damages.”

In the wake of the reduced prices, however, the government’s KFML announced it would be reducing ice and fuel charges in order to lessen the effects of the reduced fish prices.

The company reduced the selling price of diesel from MVR 17.25 to MVR 17, and the price of a ton of ice from MVR1050 to MVR 850, Sun Online revealed. The company also announced it would be reducing maintenance fees as well as attempting to penetrate new markets.

The newly appointed Minister of Fisheries Dr Mohamed Shainee told local television last week that he hoped the ruling Progressive Party of Maldives manifesto pledge to ensure all fishermen receive a basic income of MVR10,000 could be introduced next year.

“There is a lot of support for the policy from fishermen. This will incentivize the fishermen. They catch more than MVR 10,000 on good fishing days. But if the weather is bad or if the catch is low, there is a degree of despair. We are providing an incentive to overcome this despair to get ready for the next fishing season,” Shainee told Sun TV.

He revealed that the government would finance the scheme through the collection of MVR500 from each fisherman during the good months of fishing each year. It was also noted that the government planned to allocate MVR45 million from the MVR100 million allocated to subsidies fuel charges for fishing boats and hopes to designate a budget of MVR 90 million for the scheme.

While tourism is the Maldives’ largest economic sector, indirectly responsible for up to 70 percent of GDP and up to 90 percent of foreign exchange, fisheries is the country’s largest employer at over 40 percent.

The total fish catch has been declining each year since 2006 reaching 83.1 thousand metric tonnes in 2011, leading to fears about the impact of climate change and overfishing by better equipped fishing fleets on the borders of the Maldives’ Exclusive Economic Zone (EEZ).

The European Union earlier this month declined to extend the duty-free status of imported fish from the Maldives, following the country’s failure to comply with international conventions concerning freedom of religion.

The Maldives exports 40 percent of its US$100 million fishing industry to the EU, its single largest export partner by value.

Before January 2014 those exports are duty-free under the Generalised System of Preferences (GSP) program, a non-reciprocal trade agreement extended to developing countries.

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Tourism industry GDP growth flatlined in 2012, reveals Finance Ministry

The tourism industry’s Gross Domestic Product (GDP) growth in 2012 declined by 0.1 percent following 15.8 percent growth in 2010 and 9.2 percent in 2011, the Finance Ministry revealed in a “Fiscal and Economic Outlook: 2012 to 2016” statement included in the 2014 budget (Dhivehi) submitted to parliament last week.

“The main reason for this was the political turmoil the country faced in February 2012 and the decline in the number of days tourists spent in the country,” the statement explained.

“The most important statistic used to measure productivity in the tourism sector is the total number of nights tourists spend in the country. As the most number of tourists to the country now come from China, we note that the low number of nights on average that a Chinese tourist spends in the Maldives has an adverse effect on the tourism sector’s GDP.”

However, despite negative growth in 2012, the tourism industry is expected to have grown by 5.5 percent in 2013, with a 5.2 percent growth rate forecast for 2014.

The Maldivian economy is largely dependent on tourism, which accounted for 28 percent of GDP on average in the past five years, and generated 38 percent of government revenue in 2012.

Tourism growth

According to the annual tourism yearbook published by the Tourism Ministry, the average occupancy rate of all tourist establishments in 2012 was 2.5 percent below the previous year – at 70.6 percent.

“The major decline in occupancy rate was recorded from the resort/hotel sector, while the occupancy rate of guest houses and safari vessels remained constant at 23.4% in 2012,” the yearbook stated.

The average duration of stay fell from 8.6 days in 2009 to 6.7 days in 2012.

Moreover, following 20.7 percent growth in tourist arrivals in 2010 and 17.6 percent in 2011, the growth rate slowed to 2.9 percent in 2012, well below the annual average of 7.7 percent growth rate from 2008 to 2012.

The yearbook revealed that the overall positive was largely a result of the “outstanding performance” of the industry prior to the transfer of power in February.

“Fiscal discipline”

The outlook statement meanwhile observed that most economic and monetary problems facing the Maldives were “directly or indirectly related to the state’s ‘fiscal discipline.'”

The Finance Ministry noted that a fiscal responsibility law ratified in May stipulates that government debt must be brought below 60 percent of GDP within the next three years.

While public debt in 2012 stood at 78.6 percent of GDP in 2012, the outlook statement revealed that it had fallen to 72.6 percent this year.

However, the figure is expected to grow to 81 percent of GDP in 2014.

A budget surplus in the coming years would be necessary to reach the legally mandated target, the finance ministry stated.

Fiscal deficit (as a percentage of GDP)

While the estimated fiscal deficit in the 2013 budget was MVR1.4 billion (US$90 million) or 3.6 percent of GDP, the deficit at the end of the  year would stand at MVR1.7 billion (US$110 million) or 4.7 percent of GDP, the statement noted.

The main reason for the higher than expected deficit spending was failure to implement proposed revenue raising measures intended to generate MVR1.8 billion (US$116.7 million) in new income.

The measures included hiking the Tourism Goods and Services Tax (T-GST) to 15 percent, raising the airport service charge to US$30, leasing 14 islands for resort development, raising tariffs on oil, introducing GST for telecom services, and “selectively” reversing import duty reductions.

In April, parliament rejected government-sponsored legislation to raise the departure tax on outgoing passengers, prompting Finance Minister Abdulla Jihad to seek parliamentary approval to divert MVR 650 million (US$42 million) allocated for infrastructure projects in the budget to cover recurrent expenditure.

The move followed a cabinet decision to delay implementation of new development projects financed out of the budget due to shortfalls in revenue.

Meanwhile, Jihad reportedly told parliament’s Finance Committee last week that no foreign bank was willing to lend to the Maldives anymore because of instability.

When the new revenue did not materialise, Jihad said the finance ministry approached foreign banks to sell treasury bills, but was turned down. Some banks refused to roll-over previously sold T-bills, he added.

As a result, Jihad said, the government was forced to overdraw from the public bank account at the Maldives Monetary Authority.

Moreover, banks only agreed to buy T-bills at an 11 percent interest rate, Jihad said, which would not be sustainable for the government.

While MVR500 million (US$32 million) a month was needed to pay salaries and allowances for state employees, government income in some months was just MVR300 million (US$19 million), Jihad noted, leaving no option but to turn to the central bank.

Deficit and debt

The total public and publicly guaranteed external debt in 2012 stood at MVR11 billion (US$713 million) and was estimated to have reached MVR11.6 billion (US$752 million) this year, the outlook statement revealed.

A total of MVR2 billion (US$129 million) from foreign loans was disbursed in 2013 for development projects, with 7.44 percent from multilateral financial institutions, 34.5 percent from bilateral partners, and 51.8 percent from commercial banks.

The MVR839 million (US$54 million) estimated as budget support in 2013 meanwhile included US$25 million from a stand-by credit facility provided by India in 2011 and a US$29.4 million loan from the Bank of Ceylon.

External and domestic debt

The external public debt is projected to increase to MVR12.5 billion (US$810.6 million) next year, the finance ministry noted.

Domestic debt in 2012 was MVR13.8 billion (US$895 million) and MVR16 billion (US$1 billion) in 2013. This figure is projected to rise by 15 percent to MVR18.5 billion (US$1.19 billion) next year.

The state’s total debt in 2013 is therefore estimated to be MVR27.7 billion (US$1.79 billion) – expected to rise to MVR31 billion (US$2 billion) in 2014.

The government spent MVR2.7 billion (US$175 million) in 2012 and MVR3.5 billion (US$227 million) in 2013 for loan repayment and interest payments to service foreign and domestic debts.

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Dead dolphin found with puncture wound to head

A dolphin with a puncture wound to the head was found dead and stranded on Hoadedhdhoo Island in Gaafu Dhaalu Atoll yesterday morning (July 17).

In the early morning hours of Tuesday a Hoadedhdhoo resident discovered the dead dolphin on the west side of the island – which faces away from the interior of the atoll towards the open sea.

The dolphin showed no signs of life, but had sustained a visible puncture wound which was bleeding onto the hard, flat coral that surrounds the island like a buffer.

“I think fishing boat people injured it because its head was bleeding. The dolphin looked like its head had a puncture from a fishing hook,” a Hoadedhdhoo government official told Minivan News today (July 17) on condition of anonymity.

This incident could be a potential issue for the Maldives’ fishing industry, which is known for its environmentally sustainable pole and line method, where no nets are allowed, preventing bycatch which makes it ‘dolphin safe’.

The source said he believed the dolphin must have died recently because there was no foul odor coming from the body at the time it was discovered.

A white object in the dolphin’s mouth was a piece of coral probably put there by small children that had been playing near the body, the source explained.

The source noted that “not a lot” of fishing boats are seen off the coast of Hoadedhdhoo. However, large pods of dolphins have been observed in the channel slightly north of Hoadedhdhoo.

About five or six years ago a small dolphin was found dead on the same side of the island, however it did not appear to have sustained any injuries, another Hoadedhdhoo resident told Minivan News on condition of anonymity.

Dolphins essential for Maldives’ ecosystem

Following the reported incident, Minivan News contacted the Maldives Marine Research Centre (MRC) to determine the species and age of the dead dolphin.

“From the characteristics of its body shape and erect dorsal fin, it appears to be a common spinner dolphin (Stenella longirostris). They can be easily identified by a long slender beak with a black tip and black lips, while their bodies are mainly grey with three toned coloration,” MRC Assistant Research Officer Mariam Shidha told Minivan News today.

While it was difficult to determine the exact size of the deceased dolphin based on the photographs, it is “most likely to be an adult”, since adults range between 1.8 – 2.1 meters in size, while they mature at the size of 1.5 – 1.7 meters, explained Shidha.

“Dolphins are important to our ecosystem because they are apex (top level) predators which control the populations of fishes and squids to keep it all balanced,” Shidha emphasised.

She explained that stranding of cetacean species – a such as whales, dolphins, and porpoises – “do not happen that often” in Maldivian waters; at most two to three per year are reported.

“[Moreover,] in the Maldives its a very rare thing for a dolphin to be injured by a fishermen since they are not a bycatch of pole and line fisheries,” she said. “However, in the Pacific Ocean, fishermen sometimes purposefully catch dolphins as they use other [unsustainable] fishing methods in order to get to the yellowfin tunas that swim underneath dolphins.”

“The MRC has had no reports of such deliberate acts of abuse or harm to dolphins [in the Maldives],” said Shidha. However, any incidents of people harming dolphins or strandings should be reported to the MRC.

All dolphins and whales are protected under the Maldivian Law and almost all the species of dolphins found in Maldivian waters are listed in the IUCN’s red list of threatened species, noted Shidha.

The MRC is working to raise awareness about why dolphins are essential for the environment in the Maldives.

“We are educating the public on the importance of protecting these charismatic fauna which are so important for the functioning of the ecosystem,” emphasised Shidha. “Also we have held a Cetacean Symposium and outreach programs for school children.”

Fisheries Ministry

“When we find a [stranded] dolphin it’s important to know how it happened. However, I don’t know how we can investigate [in this case],” Minister of Fisheries and Agriculture Ahmed Shafeeu told Minivan News today.

“The type of pole and line fishing we have [in the Maldives] is done in a way that doesn’t harm dolphins,” said Shafeeu. “We have not had reports of dolphins being caught, it’s very unlikely.”

“Although an accident or something can happen, in that case the dolphin should be released immediately,” he emphasised. “Catching dolphins in any way [intentional or unintentional] is not allowed by law.”

“Sometimes dolphins are found washed up on the shore [of an island]. In those cases the incident should be reported to the local island council,” explained Shafeeu. “[But] there is no specific regulation that requires island councils to report to national offices if an animal is found.”

“However, if there are concerns of malpractice or someone is known to be deliberately hurting an animal, then it should be reported [to the relevant authorities beyond the island level],” he added.

‘Dolphin safe’

Environmentally-friendly, sustainable pole and line fishing allows Maldives’ tuna to be certified as ‘dolphin safe’, enabling it to be sold as a “premium” product for the European and US markets.

The ‘dolphin safe’ certification is provided by the Earth Island Institute (EII), an international non-governmental organisation (NGO).

Earlier this year EII Associate Director Mark Berman explained to Minivan News that EII’s ‘dolphin safe’ policy requires that “no tuna company will deal in sea turtles, sharks, dolphins, whales, or their products. All efforts to minimise bycatch of these species is mandatory”.

A November 3, 2011 EII press statement read, “the Maldives tuna industry has adopted a policy to ensure that no dolphins are ever killed in tuna nets.”

“That Dolphin Safe standard is respected all over the world”, Dolphin Safe program Associate Director Mark Berman told Minivan News at the time. “Major tuna importing nations will not buy tuna from governments that harm dolphins.”

According to the EII website, the companies licensed with the dolphin-safe label must meet the following criteria:

  • No intentional chasing, netting or encirclement of dolphins during an entire tuna fishing trip;
  • No use of drift gill nets to catch tuna;
  • No accidental killing or serious injury to any dolphins during net sets;
  • No mixing of dolphin-safe and dolphin-deadly tuna in individual boat wells (for accidental kill of dolphins), or in processing or storage facilities;
  • Each trip in the Eastern Tropical Pacific Ocean (ETP) by vessels 400 gross tons and above must have an independent observer on board attesting to the compliance with points (1) through (4) above
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Governance, socio-economic and political issues threaten Maldives’ reefs: study

Governance, socio-economic and political issues within the Maldives are reducing the ability of local, atoll and national management to address threats to coral reefs nationwide, according to a recently published study.

The extent of coral reef recovery following the 1998 and 2010 bleaching incidents was collaboratively studied by Reef Check, the Marine Conservation Society and Biosphere Expeditions, with the results recently published in the expedition report entitled “Little and Large: Surveying and Safeguarding Coral Reefs and Whale Sharks in the Maldives”.

“Given the severity of the initial catastrophic bleaching [in 1998], there has been a moderate to good recovery of corals in the central Maldives atolls… [however] most coral communities in the central reefs are still recovering from the massive bleaching event,” the study found.

Furthermore, human activities causing local environmental pollution and global climate change impacts are “suppressing recovery” from coral bleaching incidents for reefs nearer to “more heavily populated centres” as well as threatening sustainable “maintenance of the very corals on which the Maldives exist,” the report noted.

“[However] the potential for a full recovery of Maldives corals in many sites is good,” it continued.

The report identified numerous government and management shortcomings that exacerbate the threats impeding reef recovery in the Maldives, despite ongoing government efforts to establish Marine Protected Areas (MPA) as well as reduce carbon emissions nationally and internationally.

Governance problems must be addressed if the Maldives is to achieve UNESCO Biosphere Reserve status for the entire island nation, the study emphasised.

Governance shortcomings harm reef resilience

Political instability and the recent economic downturn in the Maldives have shifted immediate priorities away from marine conservation, according to the report.

“Unfortunately, the monitoring budget for the [Maldives] Marine Research Centre (MRC) appears to have been drastically cut in the recent past, with little information coming out of the MRC in terms of reef conditions,” noted the study.

There is also “inadequate investment in enforcing” environmental conservation laws, particularly in MPAs.

“Enforcement has been undervalued as a net contributor to the nation’s wealth, because economic returns from such an investment are not easily apparent or quickly attainable,” the study explained.

Inadequate reporting of rapid environmental degradation was a key concern highlighted in the study, because this destruction has “degraded the natural capital of the islands and the reefs that support local and tourist islands.”

Reefs have been “heavily modified” over the past 30 years – due to the lack of “concurrent precautionary management” – as “resource exploitation has expanded to meet the demands of an increased human / tourist population,” the report added.

Education and awareness regarding sustainable reef management is lacking, as balancing environmental resource extraction with protection is not included in the national curriculum, according to the report.

Meanwhile, business and tourism remain heavily dependent on a carbon-based economy due to the Maldives’ geographic remoteness, the study noted.

Given that the “Maldives’ islands are entirely, naturally made from the fine coral sand washed up onto the very shallowest coral platforms, with the highest point reaching approximately 2.4 meters above sea level” the study emphasised the importance of correcting these governance issues for reef protection.

Reef destruction threatens Maldives’ survival

Coral reefs play an unrivalled role in the Maldivian culture, lifestyle, and for fisheries relative to most other Indian Ocean states, in addition to supporting an expanding tourism and recreation industry, noted the study.

Human activities such as “tourism, reef fishing, coral mining, dredging, reclamation and the construction of maritime structures and pollution represent most impacts on coral reefs,” the study identified.

Overfishing of keystone species that are important for keeping reef predators in check, as well as inappropriate atoll development, sedimentation, and pollution were also identified as key threats.

Climate change induced impacts including sea surface temperature increases and seawater acidification from increasing concentrations of atmospheric carbon dioxide are, respectively, leading to coral bleaching as well as decreased coral skeletal strength, growth rates, and reproductive outputs. Carbon dioxide levels in the atmosphere need to be reduced to less than 350 parts per million, the report noted.

The mutually reinforcing combination of these threats will have “detrimental consequences” for the Maldives unless national and local government, tourism, and local island groups manage the local and global impacts threatening reefs, the report emphasised.

“Only with the development of capacity-building, training and resources committed to conservation at the local atoll and island level will mitigating measures be implemented,” stated the study.

Proactive island level sustainable environmental management is essential for coral reef health and recovery from previous “catastrophic, massive bleaching”, the report recommended.

This includes establishing and promoting sustainable fisheries that protect species from overfishing, including enforcing and expanding “no-take zones” for one in every three reefs, particularly around grouper spawning locations.

“Pollution must [also] be tackled” to prevent algal growth, which harms reef health.

The study concluded that “local islands, their political administrators and resorts should adhere and enforce these environmental standards, where possible, in order to stave off the most severe detrimental effects of climate-driven change to the health of the reefs.”

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