First batch of Faaragema dogs arrive in Maldives

Five of the 16 sniffer dogs for the newly established “Faaragema” dog squad arrived in the Maldives last night.

According to the Maldives Police Services, a Dutch and a British dog trainer accompanied the first batch of dogs and will train police officers in handling the dogs.

The dogs were due to arrive the previous night, but their arrival was delayed after the handlers deemed the journey from the Netherlands was too long for the puppies. They were then quarantined in Malaysia.

Faaragema dog squad

Five more puppies will arrive tonight and the remaining six are to arrive tomorrow night.

The dogs were brought in to tackle drug trafficking in the Maldives, and are going to be kept in custom made kennels at Ibrahim Nasir International Airport.

Speaking to local media, Home Ministry’s spokersperson Thazmeel Abdul Samad said that the dogs and the kennel had cost the government US$ 80,000.

The Home Ministry has meanwhile requested the Dhivehi Language Academy to come up with 16 Dhivehi names for the puppies.

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INIA capacity will increase threefold with new runway and terminal, says economic council

Additional reporting by Hassan Mohamed

The capacity of Ibrahim Nasir International Airport (INIA) will increase threefold to seven million passengers annually with the development of a new new runway alongside the previously announced new terminal, the cabinet’s economic council has revealed.

At a press briefing today, Minister of Economic Development Mohamed Saeed said efforts were underway under the direct supervision of President Abdulla Yameen to secure financing for the projects.

“The previous development concept was only for the development of the terminal,” says Saeed.

“But now we are talking of a whole new airport. We are going to build a second runway. President Yameen wants to build a second runway. That means there is no debate to this.”

After presenting a conceptual video of the airport depicting the envisioned developments, Saeed said the government’s target was completing a large portion of the project by 2017.

“We estimate that MACL [Maldives Airports Company Ltd] will earn MVR6.4 billion (US$ 410 million) in revenue in 2017 as a result of the redevelopment,” Saeed explained, adding that the income would be unprecedented in the government-owned company’s history.

Under the new master plan, Saeed said the project for the second runway has been awarded to Chinese Beijing Urban Construction Group (BUCG), which has since submitted BOQ (bill of quantities) and designs to the Chinese Exim Bank.

The project – to be financed by a concessionary loan – also involves building a fuel farm and expanding the cargo terminal as well as the runway apron, Saeed noted.

The development of the airport terminal was awarded to Japanese Taisei Corporation and is to be financed by the Japanese Bank for International Cooperation (JBIC), Saeed added.

Saeed revealed that he would be leaving for Tokyo in the coming weeks to fast-track the loan approval process, adding that construction could begin as soon as the loans are approved.

In December, MACL signed an agreement with Singapore’s Changi Airports International for consultancy in the development and expansion of INIA.

The estimated cost of the projects is US$845 million, Saeed continued, which includes improvements to the shore protection of Hulhulé Island, new seaplane facilities, new hangars, nine aero bridges, existing runway resurfacing and the relocation and demolition of existing facilities at the airport.

The redeveloped airport would also be connected to Hulhumalé via a new road, Saeed said.

Speaking at a ceremony last night, Saeed claimed that the Maldives will see US$600 million of foreign investment in the next five years.

Meanwhile, the United Kingdom, Germany and Canada has recently alerted tourists on travelling to the Maldives, citing political instability after former president Mohamed Nasheed was arrested on terrorism charges.

Asked if the current unrest could adversely affect the Maldivian economy, Saeed urged the opposition to refrain from engaging in activities that could harm the tourism industry and the economy.

GMR Compensation

In June last year, Indian infrastructure giant GMR won an arbitration case against the government for the premature termination of its airport development agreement in 2012.

A Singaporean tribunal deemed the airport development contract “valid and binding” and the MACL liable for damages after former president Dr Mohamed Waheed’s administration declared the deal void ab initio (invalid from the outset).

The exact amount owed by MACL is to be determined after the second phase of the arbitration case, with GMR seeking US$1.4 billion in damages – a figure which exceeds the state budget for 2014.

However, Attorney General Mohamed Anil has contended that the government was liable only for GMR’s initial outlay of US$7 8million, plus any costs for construction work completed after the 2010 deal was agreed.

The US$511 million agreement to manage and develop INIA – signed during the tenure of former President Nasheed – represented the largest foreign direct investment in the Maldives’ history.

Chinese arrivals

Saeed meanwhile noted that Chinese tourist arrivals account for 35 percent of all tourist arrivals to the Maldives, predicting further growth in the coming years.

However, according to statistics from the Tourism Ministry, Chinese arrivals have been slowing down in the past months, with negative growth recorded during December and January.

“January 2015 was recorded as the worst performed month for the Chinese market to the Maldives so far, with a strong negative growth of 33.1 percent,” the ministry noted in a statement last week.

“China being the number one market to the Maldives, the negative growth registered from the market was reflected in the total arrivals to the country.”

However, Saeed insisted that arrivals would pick up this month with the Chinese new year celebrations on February 19 and continue to rise with the growth of outbound Chinese tourists, which reached 109 million last year.


Related to this story

Government seeks US$600 million from China and Japan for airport development

Tourist arrivals decline in January as Chinese arrivals slow down

GMR wins arbitration case, tribunal deems airport deal was “valid and binding”

Police arrest former President Mohamed Nasheed ahead of terrorism trial

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Airport at standstill for one hour after aircraft grounded

The Ibrahim Nasir International Airport (INIA) came to a standstill yesterday (August 6) after a Cathay Pacific aircraft was unexpectedly grounded.

The runway had to be closed down for about an hour from 9pm because of a hydraulics problem on the plane. Hydraulic fluid consequently leaked onto the runway, causing numerous delays and disruptions, reported local media Haveeru.

According to Haveeru, one Emirates Flight which was scheduled to land had to be diverted elsewhere. Other flights delayed due to the incident include Malaysian Airways, Singapore Flights, and a number of domestic flights.

An official from INIA told Haveeru, “The runway has been cleared and is now operational. The delay took about one hour. Operations are now turning back to normal,” he said.

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Russia slams Maldives after US detain Russian at Malé international airport

The Russian Foreign Ministry has described the actions of Maldivian authorities as “outraging” after the US secret service apprehended Russian citizen Roman Seleznyov at Ibrahim Nasir International Airport on Saturday (July 5).

The US Department of Homeland Security has confirmed that Seleznyov was arrested after having been indicted for hacking into point of sale systems at retailers throughout the United States between October 2009 and February 2011.

As well as accusing the US of kidnapping Seleznyov – the son of Russian MP Valery Seleznyov, Russian diplomats have been quoted as condemning the role of the Maldives.

“The stance of Maldives’ authorities cannot be but outraging, since despite the existing international legislation norms they allowed another country’s special service to kidnap a Russian citizen and take him out of the country,” said the Russian Foreign Ministry.

“We demand that the Maldives’ government provides necessary explanations,” officials told Russian news agency ITAR-TASS.

Russian diplomats also said that the US had confirmed Seleznyov had been put on a private jet by US officials and taken to the US Pacific Ocean territory of Guam.

Seleznyov’s father told ITAR-TASS today that any charges should have been brought through the Maldives’ courts.

“At present, it is the same for me whether Roman Seleznyov is guilty or not. But if American authorities had real evidence of his implication in the crime, they should have brought some charges through the Maldives’ court,” said the MP.

“No one had the right to take him anywhere without the sanction issued by the Maldives’ court. And here many questions to law enforcement agencies of the Maldives arise,” Valery Seleznyov was quoted as saying.

The US government has described the detainee as “one of the world’s most prolific traffickers of stolen information”, noting that the arrest “reflects the hard work by the U.S. Secret Service and our interagency and international partners”

The statement from the Department of Homeland Security did not reveal details of Seleznyov’s arrest, with no mention made of the Maldives.

“This important arrest sends a clear message:  despite the increasingly borderless nature of transitional organized crime, the long arm of justice – and this Department – will continue to disrupt and dismantle sophisticated criminal organizations,” said Secretary of Homeland Security Jeh Johnson.

Speaking during a celebration to mark US independence day earlier this week, Maldives Foreign Minister Dunya Maumoon pledged continued assistance to the US in suppressing terrorism, organised crimes, drug trafficking, and other security issues.

Dunya also thanked the US for previous assistance in these areas.

The US granted Personal Identification Secure Comparison and Evaluation System – or PISCES – came into use in the Maldives last year after a deal with Malaysian IT firm Nexbis was terminated.

The system – cited by local media as flagging the arrival of Seleznyov in the country – was criticised by the outgoing Malaysian firm as being no more than a “terrorist tracking system”.

Minivan News was unable to obtain comment from immigration or police officials at the time of publication.

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MACL deny jet terminal outsourcing rumours

Maldives Airports Company Ltd (MACL) CEO Ibrahim ‘Bandhu’ Saleem has denied reports suggesting plans to sell the private jet terminal at Ibrahim Nasir International Airport.

“We are not aware that such discussions have taken place even. Our company has definitely not conferred on selling of the jet terminal or any other business with our share in it,” Saleem told Haveeru.

Saleem’s comments come in response to a press release from tour operators organisation MATATO earlier this month, expressing concern over rumoured plans to outsource both the terminal and aeronautical services facilities.

Saleem said he had no idea where the rumours had come from, though he told Haveeru that discussions at the government level were nothing to do with him.

MACL is a 100 percent state-owned company governed by a Board of Directors appointed by the president of the Maldives.

Prior to MATATO’s statement on June 11, Minivan News had learned that the cabinet’s economic council is currently discussing a deal with billionaire Thai businessman William Heinecke.

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GMR holds to US$1.4 billion compensation figure

GMR is sticking to the US$1.4 billion compensation claim for the abrupt termination by the Maldivian government in December 2012 of a concession agreement to develop the Ibrahim Nasir International Airport (INIA).

“The forceful takeover of the airport by Maldives government amounts to repudiation of a valid contract and therefore damages, including loss of future profit has to paid. Thus, GMR’s claim is $1.4 billion,” Indian media reported the Bangalore-based infrastructure giant as saying in a statement on Friday (April 25).

GMR noted that the Maldivian government had acknowledged for the first time that the company was owed compensation.

Prior to departing for Singapore on Thursday, President Abdulla Yameen told the press that the government would have to pay compensation to GMR upon conclusion of the arbitration process currently underway.

Asked if he was confident the outcome of the arbitration would be favourable for the Maldives, Yameen said: “The reality we have to accept is that a government with full sovereign powers made an agreement with a foreign party and leased [the airport]. This is a government, and what preceded this was a government as well. So believe we have to pay them some kind of financial compensation. “

He added that the government’s objective in the arbitration hearings was to lower the compensation amount.

If the judges on the arbitration panel accept the government’s arguments for nationalisation or expropriation, Yameen said the compensation owed to GMR could be smaller.

“We’re going to have to provide compensation in any case,” he conceded.

The US$1.4 billion sought by GMR for “wrongful termination” exceeds the annual state budget whilst the national debt is expected to rise to MVR31 billion (US$2 billion) this year.

Earlier this month, Yameen had said that the out-of-court settlement sought by GMR was too high, and that he would now await the outcome of the arbitration proceedings, which could take up to another two months.

Despite the pending arbitration decision, expansion and development of INIA was among the five mega-projects for which the government was seeking investors at the Maldives Investment Forum held in Singapore’s Marina Bay Sands yesterday.

President Yameen also met officials of the Beijing Urban Construction Group yesterday, who “expressed their interest in engaging in the infrastructure development of the [INIA],” according to the President’s Office.

Void ab initio

In December 2012, the administration of former President Dr Mohamed Waheed voided the 25-year concession agreement with the GMR-led consortium.

The US$511 million contract awarded by his predecessor former President Mohamed Nasheed – following a bidding process overseen by the World Bank’s International Finance Corporation (IFC) – was the largest foreign direct investment in the country’s history.

Waheed’s government – of which President Yameen’s Progressive Party of Maldives was a coalition partner – declared the contract ‘void ab initio’ – invalid from the outset – and gave the company seven days to leave the country.

After GMR received a stay order for the eviction from the Singapore High Court, the government successfully appealed the injunction at the Singapore Supreme Court.

Chief Justice Sundaresh Menon declared that “the Maldives government has the power to do what it wants, including expropriating the airport.”

At a press conference in the wake of the airport takeover, Finance Minister Abdulla Jihad – who retained his post under the new administration – said that the Maldives would pay whatever compensation was required “however difficult” while Attorney General Azima Shukoor expressed hope that the compensation would be lower than anticipated.

A special audit conducted by the Auditor General’s Office in early 2013 found that as of October 31, 2012, GMR Male’ International Airport (GMIAL) had completed 25 percent of the refurbishments and upgrades to INIA planned for the end of 2014, and had been invoiced by its contractor for US$69 million.

“Significant progress had been made in some areas – for example, 87 percent of the material for land reclamation had been dredged,” the report (English) stated.

“In the meantime, all work on the ground on the improvement to the airport has ceased. Sensitive elements of the new structures that had been planned by [GMR] are incomplete and exposed to the weather and at risk of damage – possibly closing off the option of re-using these elements to reduce the cost of any future development of the airport,” the report concluded.

After examining the bidding process, the audit report stated that evidence to back allegations of “improper interference” during technical bidding process “is not conclusive on this point”, and deferred the matter to the Anti-Corruption Commission (ACC), which ruled out corruption in June 2013.

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Yameen concedes that GMR is owed some compensation

With additional reporting by Ahmed Rilwan

President Abdulla Yameen has today said the government was sure it would have to pay some compensation for cancelling the agreement made with the Indian infrastructure giant GMR to lease Ibrahim Nasir International Airport (INIA).

“The truth we should accept is that a government with all its sovereignty has given permission to a foreign party under an agreement,” said the president.

“So we believe some sort of financial compensation must be paid to them. A compensation must be given for taking the airport [from them]. What we are trying to make sure this compensation is not big but average.”

Yameen was speaking to the press before leaving for Singapore to take part in the Maldives Investment Forum – an event he described as “the first step taken towards a fresh start for the Maldives in today’s world economy”.

In November 2012, President Dr Mohamed Waheed’s cabinet declared the GMR agreement void ab initio – invalid from the outset – and ordered the developer to leave, just two years into its 25 year concession agreement.

President Yameen explained to the press today that his advisors believed that, if the arbitration panel could be persuaded that the deal had been anulled due to the airport’s national importance, the compensation would be small.

GMR had initially claimed US$1.4 billion – a figure greater than the Maldives’ annual state budget.

Yameen’s Progressive Party of Maldives (PPM) formed part of the Waheed coalition government, though it’s leader – former President Maumoon Abdul Gayoom – has since accuse Waheed of going against his party’s advice by failing to reach an amicable agreement with GMR and the Indian government.

During his first official state visit to Indian in January, Prime Minister Dr Manmohan Singh requested President Yameen to “amicably” settle the GMR airport issue.

Earlier this month, Yameen had said that the out-of-court amount sought by the infrastructure company was too great, and that he would now await the outcome of proceedings, which could take up to another two months.

The US$511 million concession agreement to manage and upgrade the airport – awarded under the former government of Mohamed Nasheed – was the single largest foreign investment in the Maldives’ history.

President Yameen will tomorrow give the keynote speak at the landmark investment forum, as he seeks to generate interest from foreign investors for five ‘mega-projects’ – one of which is the further development of Ibrahim Nasir International Airport (INIA).

As part of the president’s attempts to lure foreign investors back to the country, he has promised special economic zones which hopes will be “likened to cities in Dubai or the Emirates” and “the [business] environment we have in Singapore.”

Senior management of Singapore’s Changi International Airport visited the Maldives earlier this month, with Yameen explaining the purpose of the visit to press this afternoon.

“Changi’s management will be our final consultant with the terminal [project] and other consultancies required for the airport,” he explained. “We want to seek technical expertise and information on how to do things from Singapore Changi.”

“The project has progressed far now, Changi has expressed interest. So we believe all the supervisory and consultancy work of this terminal will be carried out by Changi.”

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“Ideal” time to invest, says MNCCI as Maldives Investment Forum approaches

With additional reporting by Daniel Bosley

“The last 3 years there has been a lot of turmoil, but now is the ideal time to invest and talk about business,” suggests Ishmael Asif, Vice President  of the Maldives National Chamber of Commerce and Industries (MNCCI).

In light of the upcoming Maldives Investment Forum (MIF) in Singapore, Asif told Minivan News that the Maldives can offer a secure political backdrop for any potential foreign investments.

“From the chamber, we would like to give a message to foreign investors that political tension is over and there is room for investments. Maldives always welcomes foreign investments.”

The forum – set to take place on Friday (April 25) at the Marina Bay Sands hotel in Singapore – will aim to increase the interest of Asia-region investors, and will be the first forum of such a scale to be hosted by the Maldives in another country.

Investors will have the opportunity to submit proposals for five mega projects, including the following – whose details have been provided by the Ministry of Economic Development:

Ihavandhippolhu Integrated Development Project (iHavan) – This project aims to capitalise on the US$18 trillion worth of goods that pass through the channel to the north of the Maldives’ northernmost atoll each year.

The project is set to include a transshipment port facility, airport development, a cruise hub, yacht marina, bunkering services, a dock yard, real estate, and conventional tourism developments.

Citing growing east-west trade between China and India, the project also proposes to take advantage of more than 30 large cities which lie within a 4000km radius of the atoll. Moreover, the South Asian Free Trade Arrangement (SAFTA) means that export processing zones established in iHavan will enjoy duty free access to 1.7 billion people in the South Asian region.

Expansion of Ibrahim Nasir International Airport (INIA) Following the 2012 termination of the GMR concession agreement, the government is currently devising a new master plan for developing the country’s main international airport.

Around forty percent of the tourism industry’s bed capacity is currently situated in the same atoll as the airport, with 80 percent of tourists taking less than one hour to reach their destination from INIA. Furthermore, the government plans to increase tourist arrivals to 5 million per year during its current term.

“As such, the need to expand the airport’s capacity to cater to this additional demand and to provide value added commercial and high end retail services of highest international standards, is a key priority of the Government,” explains the forum’s website.

Hulhumale’ Phase II DevelopmentThe next stage of the development in the Maldives “first fully reclaimed, pre-planned city” will involve further reclamation to the north of the island.

Potential investors are being made aware of President Abdulla Yameen’s plans to develop the island into a ‘youth city’ with a population of 50,000, which will include a “technopolis park” to facilitate light industries.

The construction of the long-awaited bridge between Malé and Hulhumalé is planned to further open up economic opportunities in the reclaimed island city.

Relocation and expansion of the existing central portNoting that the country’s major port in Malé has reached its capacity, the MIF will hope to attract investors to assist in the relocation of the main port to the nearby industrial island of Thilafushi.

The project will include reclamation work on the island, the introduction of state-of-the-art facilities – including warehousing capacity, and marine harbour and support functions to cater to all types of vessel.

Exploration for oil and gas With oil imports accounting for 31 percent of the Maldives’ imports in 2012, the country is seeking to reduce reliance on foreign fuel with an oil and gas exploration projects, explains the event information.

Previous attempts to locate economically viable reserves were unsuccessful, though the government wishes to find investors who can undertake more extensive surveys in the country’s territory.

The proposed projects are due to be supported by the “relatively freer regulatory environment” provided by the special economic zones promised by the Yameen administration.

Creating a future for the Economy

Asif noted that the decision to hold the conference in Singapore sends a clear message to the international community that the Maldives is keen to discuss ideas with their potential partners, and to build bridges with countries they would like to work with in the future.

“It will create a better platform for Maldives when we do work in places like Singapore – it’s an ideal place to unveil something like this so we can go forward with that area.”

The operator’s of Singapore’s Changi Airport met with President Yameen last week, sparking rumours that they would provide consulting services on the development of INIA.

“Such a forum like this is organised to give a positive vibe, that we are open for foreign investment and willing to discuss [ideas],” he added.

A host of countries have already expressed their interest and are registered for the Maldives Investment Forum, President’s Office Spokesperson Ibrahim Muaz confirmed today.

“There is a lot of co-operation from business groups from other countries, like China, the US, Japan and from this area. There are a lot of participants registered on the forum,” said Muaz,

President Yameen will be leaving tomorrow afternoon to attend the forum, where he will give the keynote speech to the more than 300 investors from 15 countries who have reportedly registered to participate.

Following a presentation detailing the five projects, Tourism Minister and head of the cabinet’s Economic Council Ahmed Adeeb will give a speech, before a question and answer session regarding the proposed projects.

President Yameen’s vision for foreign investment was spelled out recently, during the inauguration of a housing project in Hulhumalé – part of the ‘youth city’ project.

“What we would like to confirm for the foreign investors who come to the Maldives is that foreign investors should feel that Maldives is your second home here,” said Yameen.

“We are going to open up the Maldives in a huge way to foreign investors. Our thirst cannot be quenched. The opportunity to foreign investors is going to be enormous.”

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Amount proposed by GMR for out-of-court settlement too big, says president

President Abdulla Yameen has said that the compensation proposed by GMR for an out-of-court settlement is too big and the government does not believe that it has to be paid.

“GMR is seeking a very big compensation. We, the government, do not believe that we can pay such an amount, or that it is necessary to pay it. So now we are facing [the issue of] unmatching numbers,” Yameen was quoted as saying in local media.

Yameen suggested that the large compensation being sought is the reason the parties have failed to reach an out-of-court settlement.

Both sides are now awaiting the conclusion of the arbitration, revealed Yameen, and further discussions will continue afterwards if it is necessary. He did not reveal the amount proposed for an early settlement.

Proceedings of the arbitration case, in which GMR is seeking US$1.4 billion as compensation for the abrupt termination of the Ibrahim Nasir International Airport (INIA) contract, has already begun in Singapore.

Last week the government appointed sitting Supreme Court Judge Abdulla Saeed as a legal expert in the arbitration case, with the Saeed promptly travelling to Singapore.

According to the Judges Act, however, any judge leaving the country to take part in a judiciary or law-related event should first obtain special permission from the independent Judicial Service Commission (JSC).

Judicial Service Commission (JSC) member Sheikh Shuaib Abdurahman – one of the two members legally required to give consent for such a trip – has said said he was unaware of Judge Abdulla Saeed’s departure, though the Attorney General’s office has told local media that all necessary permissions were acquired.

The Maldives’ legal team includes Attorney General (AG) Mohamed Anil,  Deputy AG Ahmed Usham, and a team of experts from Singapore and the UK.

Haveeru has reported that GMR hired former Sri Lankan Attorney General Mohamed Shibly Aziz, former Maldivian Deputy Solicitor General Ibrahim Riffath, and Maldivian lawyer Fayaz Ismail to assist them in matters related to the Maldivian legal system.

The AG’s Office is now looking into Riffath’s involvement in the case, stating that he could have accessed privileged information when working at the office during the cancellation of the GMR agreement and several other GMR related cases before that.

The office has noted that information obtained through holding such a position cannot be utilised in such circumstances.

The AG’s Office earlier stated that the Maldives would be represented by Singapore National University Professor M. Sonaraja, while former Chief Justice of the UK Lord Nicholas Addison Phillips were to represent GMR.

The arbitrator – mutually agreed upon by both GMR and the Government of Maldives – is retired senior UK Judge Lord Leonard Hubert Hoffman.

Legal experts are expected to present their opinions to the arbitration panel today, local media has reported, while the process is expected to continue until Wednesday.

Airport development plans

The government owned Maldives Airports Company Limited which took over the airport’s management from GMR after the cancellation of the agreement, is now planning further development.

A US$5 million work project to develop ground handling at INIA was announced in January, with more plans to be announced in the near future based on a revised version of the previously compiled Scott Wilson airport development master plan.

Since assuming office President Yameen has made repeated assurances that the country is safe for foreign investors, calling for new developers from the Arab-Muslim countries in particular.

“The thrust of the government is to welcome foreign investment, ‎and to assure all investors that your investment – your money – is safe ‎with us, and your stay here in Maldives is going to be conducive ‎for you”, Yameen said earlier this month at a housing project inauguration in Hulhumalé.

The president yesterday shared the government’s INIA development plans with a delegation of Singapore’s Changi Airport Group and Changi Airport International in a meeting at the President’s Office, although a subsequent press release did not specify the exact reasons for the visit.

President Yameen will also travel to Singapore later this month to inaugurate the Maldives Investment Forum, a government initiative to showcase ‘high level’ investment opportunities in the country.

During the forum, the government’s development plans and projects will be revealed to international corporate and individual investors. One of the key five projects being scheduled for presentation is the the development of INIA.

Earlier this month Maldives Tourism Development Corporation Plc – 45 percent of whose shares are held by the government –  sold Herethera Island Resort in Addu City for US$33 million to Singapore’s Canaries Private Ltd.

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