Vice President Waheed Deen meets Nigerian counterpart during INIA stopover

Vice President Mohamed Waheed Deen met with his Nigerian counterpart Namadi Sambo at Ibrahim Nasir International Airport (INIA) on Thursday (May 30).

During a stopover en route to China, Sambo held discussions with Deen on issues including extending cooperation in addressing concerns over piracy, security and terrorism, according to the President’s Office website.

As part of wider talks on bilateral relations between the two countries, the two vice presidents also spoke on issues of tourism, agriculture and energy. Vice President Sambo departed for China the same day following the meeting.

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GMR-Maldives arbitration to begin mid 2014: Attorney General’s Office

The Attorney General’s (AG’s) Office has confirmed that an arbitration case concerning the government’s decision to void its concession agreement with Indian Infrastructure giant GMR will begin by the middle of next year.

Deputy Solicitor General Ahmed Usham today told Minivan News that both parties had agreed to commence proceedings by the middle of 2014 and were now waiting on arbitrators to confirm the exact schedule for when their respective cases would be presented.

The initial agreement was reached after representatives for the state and GMR met in London, England on April 10 for a preliminary procedural meeting.  A timetable was agreed upon for holding hearings over the cancellation of a US$511 million contract to develop and manage a new terminal at Ibrahim Nasir International Airport (INIA).

Usham said that the hearing in London last week had been focused solely on establishing a timetable for when arbitration will begin proper in Singapore.

“It is quite straight forward in these procedural hearings.  We discussed the schedule for hearings, such as when cases would be presented, as well as when parties can reply and make counter claims,” he said. “These arbitrators are quite busy, so it can be difficult to manage time in their schedules.”

The AG’s Office has previously claimed that the Maldives will be represented by Singapore National University Professor M Sonaraja, while former Chief Justice of the UK, Lord Nicholas Addison Phillips, will represent GMR.

The arbitrator mutually agreed by both GMR and the government is retired senior UK Judge, Lord Leonard Hubert Hoffman.

Concession agreement

In 2010, GMR-Malaysia Airports Holdings Berhad (MAHB) consortium, the government of former President Mohamed Nasheed and Maldives Airport Company Limited (MACL) entered into a 25-year concession agreement worth US$511 million (MVR 7.787 billion). The agreement charged the GMR-MAHB Consortium with the management and upgrading of INIA within the 25 year contract period.

However, in November 2012, the government of President Dr Mohamed Waheed Hassan Manik declared the developer’s concession agreement void and ordered it to leave the country within seven days.

A last minute injunction from the Singapore High Court during arbitration proceedings was overturned on December 6, after Singapore’s Chief Justice Sundaresh Menon declared that “the Maldives government has the power to do what it wants, including expropriating the airport.”

GMR is seeking US$800 million in compensation for the sudden termination, while the Maldivian government is contending that it owes nothing as the contract was void ab initio – meaning the contract was invalid from the outset.

Should the argument of void ab initio fail, the government has claimed the second legal grounds on which it would argue in favour of termination of the contract would be that the contract had been ‘frustrated’.

‘Frustration of a contract’ is an English contract law doctrine which acts as a device to set aside contracts where an unforeseen event either renders contractual obligations impossible, or radically changes the party’s principle purpose for entering into the contract.

“The government has given a seven day notice to GMR to leave the airport. The agreement states that GMR should be given a 30 day notice but the government believes that since the contract is void, it need not be followed,” said then Attorney General Azima Shukoor.

The awarding of the bid in 2010 was overseen by the World Bank’s International Finance Corporation (IFC), which the Waheed government has accused of being “negligent” and “irresponsible”.

Should the matter be decided in the government’s favour, uncertainty remains as to the potential impact on foreign investor sentiment given the prospect of sudden asset seizure under the ‘void ab initio’ precedent.

If decided in GMR’s favour, the outcome of the case could potentially see the Maldives facing sovereign bankruptcy, with millions of dollars in additional debt emptying the state’s already dwindling reserves, crippling the country’s ability to obtain further credit, and potentially sparking an economic or currency crisis.

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Ibrahim Nasir International Airport reduces jet fuel costs

Ibrahim Nasir International Airport reduced the price of jet fuel from US$1.16 per litre to US$1.14 per liter for international flights and from US$1.14 to US$1.13 for domestic flights, reports local media.

The State Trading Organisation (STO) signed a US$136 million agreement March 31 to provide Maldives Airports Company Limited (MACL) with jet fuel.

The MACL said the price reduction is a result of the decrease in the product’s cost, which took effect April 1.

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Preliminary hearing on GMR-Maldives arbitration case scheduled for April 10 in London

The preliminary hearing of the arbitration case concerning the government’s voiding of its concession agreement with Indian Infrastructure giant GMR is scheduled to take place on April 10 in London, reports local media.

On February 3, the parties announced the appointment of arbitrators for the case.  According to the Attorney General’s office, the Maldives will be represented by Singapore National University Professor M Sonaraja, while former Chief Justice of the UK, Lord Nicholas Addison Phillips, will represent GMR.

The arbitrator mutually agreed by both GMR and the government is retired senior UK Judge, Lord Leonard Hubert Hoffman.

Speaking to the newspaper, Deputy Solicitor General Ahmed Usham said that the meeting will take place at the presence of three arbitrators appointed to hear the case along with lawyers representing the government of Maldives, Maldives Airports Company Limited (MACL) and GMR.

“It is not an official hearing of the arbitration case. It is a hearing in which a date for the commencement of the hearings would be agreed and to agree as to how the case should proceed. Decisions concerning how the proceedings should take place will be agreed,” Usham told Haveeru.

He also said that although the preliminary hearing was to take place in London, the official hearings of the case will be heard in Singapore.

In 2010, GMR-Malaysia Airports Holdings Berhad (MAHB) consortium, government of former President Mohamed Nasheed and Maldives Airport Company Limited (MACL) entered into a 25-year concession agreement worth US$511 million (MVR 7.787 billion) – in which the GMR-MAHB Consortium was contracted with the management and upgrading of Ibrahim Nasir International Airport (INIA) within the 25 year contract period.

However in November 2012, the government of President Dr Mohamed Waheed Hassan Manik declared the developer’s concession agreement void and ordered it to leave the country within seven days.

A last minute injunction from the Singapore High Court during arbitration proceedings was overturned on December 6, after Singapore’s Chief Justice Sundaresh Menon declared that “the Maldives government has the power to do what it wants, including expropriating the airport.”

GMR is seeking US$800 million in compensation for the sudden termination, while the Maldivian government is contending that it owes nothing as the contract was void ab initio – meaning the contract was invalid from the outset.

Should the argument of void ab initio fail, the government have claimed that its second legal ground on which it would argue in favour of termination of the contract would be that the contract had been ‘frustrated’.

‘Frustration of a contract’ is an English contract law doctrine which acts as a device to set aside contracts where an unforeseen event either renders contractual obligations impossible, or radically changes the party’s principle purpose for entering into the contract.

“The government has given a seven day notice to GMR to leave the airport. The agreement states that GMR should be given a 30 day notice but the government believes that since the contract is void, it need not be followed,” said Attorney General Azima Shukoor at the time of announcement of the contract.

The awarding of the bid in 2010 was overseen by the World Bank’s International Finance Corporation (IFC), which the Waheed government has accused of being “negligent” and “irresponsible”.

Should the matter be decided in the government’s favour, uncertainty remains as to the potential impact on foreign investor sentiment given the prospect of sudden asset seizure under the ‘void ab initio’ precedent.

If decided in GMR’s favour, the outcome of the case could potentially see the Maldives facing sovereign bankruptcy, with millions of dollars in additional debt emptying the state’s already dwindling reserves, crippling the country’s ability to obtain further credit, and potentially sparking an economic or currency crisis.

In December 2012, the Maldives government paid back US$50 million to the State Bank of India, after it refused to extend the period of the treasury bonds issued by the bank during the previous government. India has called in further installments of US$50 million, forcing the government to draw on the state reserves.

Finance Minister Abdulla Jihad has said the government is yet to come to an arrangement to pay the next US$50 million installment to SBI, explaining that the money will have to come from the Maldives Monetary Authority (MMA).

“The US$50 million due in February will have to be paid from the reserve. We have been ordered to pay the amount. There has been no change to the order so far. So it must be paid,” Jihad told local media at the time.

At the start of 2013, state reserves had shrunk to MVR 4.9 billion (US$317.7 million), according to the MMA.

“Gross international reserves at the MMA have been declining slowly, and now account for just one and half months of imports, and could be more substantially pressured if major borrowings maturing in the next few months are not rolled over,” an International Monetary Fund (IMF) delegation observed during a mission to the Maldives in November last year.

Moreover, one of GMR’s lenders, Axis Bank, is also seeking the repayment of loans for the airport project, which were guaranteed by the Ministry of Finance and approved by the Attorney General’s Office under the former government.

Attorney General’s office was not available for a comment at time of press.

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Government lacks plan to address “bad shape” of airport: dismissed transport minister

Former Transport Minister Dr Ahmed Shamheed has said criticism leveled at the government by Adhaalath Party (AP) President Sheikh Imran Abdulla over a lack of development at Ibrahim Nasir International Airport (INIA) was justified considering the “bad shape” of the site.

Dr Shamheed, who served under the current government before being dismissed in November 2012, has warned that failure to outline a development plan for INIA after the government evicted the foreign investor renovating the site could be disastrous for the country.

Late last year President Waheed’s government declared void an agreement with Indian infrastructure group GMR to upgrade and develop the airport, and gave them seven days to leave the country. The deal was the Maldives’ largest single foreign investment project, valued at  US$511 million.

The Adhaalath Party was a key opponent of foreign development of the airport, demanding it be reclaimed on nationalistic grounds.

However speaking to private broadcaster DhiTV yesterday (January 28) the party’s President Sheikh Imran Abdulla claimed that there had been a worrying lack of progress in developing the site after it had been handed to the state-owned Maldives Airports Company Limited (MACL).

Sheikh Imran, an outspoken supporter of attempts to “reclaim” the management of INIA from GMR, raised concerns that the airport was returning to the “bad condition” it was previously in, criticising MACL for lacking a vision to manage and develop the site,” according to Sun Online.

“Maldivian people had great hopes when the airport was reclaimed from GMR. It was been two months since and still, there is no vision for the airport. There is no proper plan for how it will be managed,”  he was quoted as saying.

Development plans

Former Transport Minister Shamheed told Minivan News today that he believed Sheikh Imran’s criticisms were fair, adding that if the government did have a plan for development, they had not demonstrated it so far.

“I haven’t heard what the government is planning. They seem to be managing the airport as if everything is perfect. Yet they may have to close down the site in future without further development. If [the government] has a plan they haven’t revealed it yet. All they have talked about is setting up a company to manage the site.”

According to Dr Shamheed, following the decision to terminate the GMR contract last year the government has been facing two key challenges with regard to the airport.

The first of these challenges is securing sufficient financing for completing renovation of the existing terminal and runway.  The second key issue, Dr Shamheed said, obtaining expertise and skilled developers to bring the airport in line with international standards as expected of a destination like the Maldives.

“To get the airport to the right level, they will need to bring in outside help,” he claimed. “The airport is in very bad shape right now and work is needed on the runway, all of which cannot be done without finance.”

Minivan News was awaiting a response from MACL at the time of press. Meanwhile, both current Minister of State for Transport and Communications Mohamed Ibrahim and President’s Office Media Secretary Masood Imad were not responding to calls.

Despite the criticisms, President Dr Mohamed Waheed today asserted that “shockingly big investments” would be coming to the Maldives in unspecified areas.

Speaking at the opening of the MACI BuildExpo 2012/2013 show at the Dharubaaruge convention hall in Male’, President Waheed claimed that despite the decision to void a sovereign agreement with GMR – a decision backed by Singapore’s Supreme Court – investor trust in the Maldives had not been diminished.

Sublease plans

Just last month, Minister of Tourism Ahmed Adheeb stated that the government was not planning to hand over full control of operations at INIA, but might sublease specific development projects to international parties through a “transparent” bidding process.

Adheeb told Minivan News that privatising the only international airport allowed it to become a monopoly which was not in the best interests of the country.

The Maldives cabinet also last month recommended forming a government-owned company to operate INIA  through a special contract with the Maldives Airports Company Ltd (MACL).

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Government considering seeking compensation from GMR: Attorney General Azima Shukoor

Attorney General (AG) Azima Shukoor has said the Maldives government could opt to seek compensation from infrastructure group GMR after it decided to void the India-based company’s concession agreement to develop Ibrahim Nasir International Airport (INIA), according to local media.

GMR last week confirmed that it was seeking an estimated US$800 million in compensation in order to recover what it has claimed are investment and earnings after the government “wrongfully” terminated its contract.

In a press conference held yesterday (December 17), the attorney general maintained the government’s belief that the agreement with GMR to develop INIA was illegal.  She added that the government therefore intended to seek compensation for damages it “might” have incurred during the process of entering into the contract with GMR, local newspaper Haveeru reported.  The contract was signed during the administration of former President Mohamed Nasheed.

Highlighting the pending arbitration process in Singapore Court between the government and GMR, Shukoor said that efforts were being made to appoint arbitrators for the hearings. She added that the government and Maldives Airports Company Limited (MACL) had appointed a “member” of Singapore National University as their arbitrator.

Similarly, GMR will also be given a 30-day period to appoint an arbitrator on its behalf.

Shukoor suggested during the yesterday’s press conference that it may take a period of one year until the due procedures were completed before a decision was made in the courts.

“It will take about two months time to appoint the panel to overhear the arbitration case. After that, parties will exchange documents and affidavits and respond to it and only after that a proper hearing on the matter will be held and might take up a period of one year,” she suggested.

Indian media reported last week that GMR had sent a letter to the Finance Ministry stating that it would seek compensation worth US$800 million.  Shukoor denied such a communication had been sent, adding that she did not believe such a demand could even be made.

“We terminated the agreement on the grounds of void ab initio (void from the outset) , therefore we will begin the negotiation on the position that the government of Maldives do not require to pay back anything,” Shukoor explained.

However, she admitted that owing to the size of GMR’s investment, there remained a possibility that government might have to pay some amount that would be determined through the arbitration process.

“Even if we do require paying back as compensation, it would be based on the decisions reached during the arbitration process. If it is settled out of court, then it would be based on legal arguments raised by the parties to the contract,” she added.

Shukoor has also claimed that even before INIA was handed over to GMR, no asset valuation was carried out – a decision expected to cause problems for the government. She also said that it has not been yet decided how the asset valuation would be carried out or how the amount that the government might seek in compensation from GMR would be calculated.

Even with the arbitration process now proceeding, Shukoor told local media that if the government believed additional compensation was required, it would seek the additional amount through the same courts.

“A lot of work is being carried at the moment. However, we have not yet calculated the amount we might have to pay or the amount that had been invested and even the amount we expect to seek,” she explained.

GMR demands US$800 million in compensation

GMR is seeking US$800 million in compensation following the termination of its US$511 million concession agreement signed under the former government back in 2010.

The Indian infrastructure giant has said that the proposed US$800 million claim was based on its “provisional estimates” and that the company had also taken into account the Maldives’ ability to cover such payments if compensation was awarded by the Singaporean courts overseeing arbitration.

GMR’s chief Financial Officer (CFO) Sidharath Kapur previously told Minivan News that the sum was a “preliminary estimate” based on a number of factors including investments made by the company, debt equity and loss of profits as a result of the contract termination.

He also added that on last Tuesday (December 11) the company had communicated with Maldives Ministry of Finance by sending an official letter outlining its concerns that the contract had been “wrongfully” terminated without respect for the agreed procedures.

Meanwhile according to Finance Minister Abdulla Jihad, no mechanism is currently budgeted should the Maldives face a multi-million US dollar bill for evicting GMR, but stressed it was not for the company to decide on any eventual payment.

He also played down fears that any potential fine could prove perilous for the country’s economy, as well as attempts to reduce the spiralling budget deficit, stating that any possible fines would be set by the Singaporean arbitration court hearing the dispute.

“We will deal with the matter when we know the amount of compensation to be paid,” he said at the time. “GMR cannot decide, it will be down to the court [hearing the arbitration].”

The INIA concession agreement

In 2010, the government of Maldives through its Finance Ministry, MACL and GMR-MAHB entered into a concession agreement with INIA whereby the Malaysian-Indian consortium were to develop and operate the airport for a period of 25 years.

According to the concession agreement a “project company” under the name GMR International Airport Limited (GMIAL) was to carry out the development project.

However, a lengthy dispute between the new government of President Dr  Mohamed Waheed Hassan and the GMR Group led to the eviction of the agreement.

On November 27, President Mohamed Waheed’s cabinet declared the agreement void, and gave the company a seven day ultimatum to leave the country.

Shukoor at the time stated the government reached the decision after considering “technical, financial and economic” issues surrounding the agreement.

She also claimed the government had obtained legal advice from “lawyers in both the UK and Singapore as well as prominent local lawyers – all who are in favour of the government’s legal grounds to terminate the contract.”

The INIA was handed over to the government on December 8, in an invitation-only press conference; Finance Minister Jihad presented the official handover documents to MACL Managing Director Mohamed Ibrahim, and said that the Maldives would pay whatever compensation was required “however difficult”.

With arbitration proceedings underway in Singapore over the contested airport development charge (ADC), GMR received a stay order on its eviction and appeared confident of its legal position even as the government declared that it would disregard the ruling and proceed with the eviction as planned.

On December 6, a day prior to its eviction, the government successfully appealed the injunction in the Supreme Court of Singapore. Chief Justice Sundaresh Menon declared that “the Maldives government has the power to do what it wants, including expropriating the airport.”

That verdict, effectively legalising the sovereign eviction of foreign investors regardless of contractual termination clauses or pending arbitration proceedings, was “completely unexpected”, according to one GMR insider – “the lawyers are still in shock”, he said at the time.

A last ditch request for a review of the decision was rejected, as was a second attempt at an injunction filed by Axis Bank, GMR’s lender to the value of US$350 million.

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Annulling GMR agreement “only option for reclaiming airport”: Dr Hassan Saeed

The only option for “reclaiming the airport from GMR” is to invalidate or cancel the concession agreement with the Indian infrastructure giant, argues Dhivehi Qaumee Party (DQP) Leader and Special Advisor to the President, Dr Hassan Saeed, in a new book (Dhivehi) released on Monday.

The book, titled: “Loss and challenges of the long-term leasing of Male’ international airport to GMR” was launched at a ceremony on Monday at the government-aligned private broadcaster DhiTV by Home Minister Dr Mohamed Jameel Ahmed, deputy leader of the DQP.

The booklet covers various issues surrounding the concession agreement awarding management and development of the international airport to a consortium of GMR Infrastructure Limited and Malaysia Airports Holdings Berhad (MAHB), alleged purported national security threats, economic and financial damages and undue advantages for the consortium.

Speaking at the book launching ceremony, Home Minister Jameel said it was the duty of the most capable people in the country to step forward and help “liberate” the nation from “grave problems” during the current “difficult times”.

Jameel claimed the former DQP presidential candidate’s book would reveal a number of facts that the Maldivian people were unaware of before the signing of the agreement.

The Home Minister added that he hoped ongoing efforts by the coalition of parties supporting the current government would yield results.

Dr Hassan Saeed was not responding to calls by Minivan News at time of press.

In his book, Saeed laid out three choices for the government: continuing the agreement in its current form, resolving disputes through dialogue or invalidating the agreement.

The DQP leader contended that cancelling the agreement and nationalising the airport would be the beneficial course of action for the nation.

“There is little hope that GMR would implement changes brought to the agreement through dialogue,” Saeed wrote. “GMR will change what is written in the agreement in black and white any time it pleases. For example, although the agreement states that 27 percent of from oil revenue must be paid to the state, it has been changed. GMR knows very well the skill to change the minds of the government of the day and its senior officials.”

Saeed further claimed that the concession agreement posed dangers to national security, in addition to being contrary to public interest and violating the constitution, the Public Finance Act and the Companies Act.

If the airport was not nationalised in the near future, since all parties in the ruling coalition opposed the deal, Saeed argued that the presidential election in 2013 would become “a referendum” on annulling the agreement.

Saeed claimed that GMR would donate large sums of money to parties in favour of keeping the agreement in place.

Conceding that cancelling the agreement would strain relations with India, Saeed contended that the move would be beneficial in the long-term to both countries.

Saeed compared cancelling the deal to “taking bitter medicine to cure a disease” or “amputating an organ to stop the spread of cancer.”

The book also likened GMR to the Indian Borah traders expelled from the Maldives by former President Ibrahim Nasir.

IFC role

Meanwhile, in June this year, a delegation from the International Finance Corporation (IFC) – a member of the World Bank group and the largest global institution focused on the private sector in developing countries – met with senior government officials to address concerns over the concession agreement.

On the bidding process, which was organised by the IFC and “evaluated based on the payment of an upfront fee as well as annual concession fees as a percentage of gross revenues to the government”, a document by the organisation explained that, “Each bidder was required to demonstrate that it had the requisite experience in developing, designing, constructing, operating, and financing airports of a similar size.

“The technical solutions proposed by the bidders were also expected to consider the specific conditions on Hulhulé Island,  including its physical and environmental constraints, and the coordination required between conventional aviation activities, seaplanes, and motor boats.

“The cornerstone of the project was the construction of a new passenger terminal expected to meet LEED silver criteria and to be carbonneutral—i.e., to minimize energy consumption and carbon emissions through the use of energy-efficiency and renewable-energy technologies, and minimize water consumption. The bidders were also asked to make specific, predefined improvements to the existing airport infrastructure, and to manage all core airport services, including the provision of fuel—a historically established role at Malé airport.”

However, in early September, the government accused the IFC of negligence during the bidding process for INIA – allegations there were rejected by the organisation amidst continued calls from government-aligned parties to renationalise the airport.

Both the government and GMR are presently involved in an arbitration case in Singapore over the airport development.

Previous publications

In August, Dr Hassan Saeed released a book in English entitled, “Democracy betrayed: behind the mask of the island President”.

Speaking to local media at the book’s launch at the studios of private broadcaster Villa Television (VTV), DQP Secretary General Abdullah Ameen said the book detailed reasons why former President Nasheed had to resign on February 7.

Ameen added that the reasons mentioned in the book included the controversial detention of Criminal Court Chief Judge Abdulla Mohamed and allegations that Nasheed wished to “destroy the values of Islam” in the country.

In the months leading up to the controversial transfer of power on February 7, the DQP published a pamphlet titled ‘President Nasheed’s devious plot to destroy the Islamic faith of Maldivians’.

In an interview with UK’s the Guardian newspaper recently, Saeed said the charges were justified. “You look at his behaviour, his actions, you have to come to that conclusion,” Saeed said.

The Nasheed administration had slammed the publication at the time for containing “extremist, bigoted and hate-filled rhetoric”. The pamphlet and religious-based allegations also led to successive attempts by the Nasheed administration to arrest two senior members of the party and sparked a debate on freedom of expression and hate speech in the Maldives.

Saeed was also a co-author of the book Freedom of Religion, Apostasy and Islam, which discussed the issue of apostasy in Islam and stirred controversy during the 2008 presidential election.

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Maldives travel retail in the spotlight after airport sells US$39,000 bottle of whisky

This story was originally published on Minivan News’ spin-off travel review site, Dhonisaurus.com.

Ibrahim Nasir International Airport (INIA) in Male’ has become the second duty free operator in the Asia Pacific region to sell a recently launched US$39,000 (MVR592,000)  bottle of whisky, reflecting what one retailer said is the growing significance of the destination for providers of high-end luxury goods.

Earlier this month, resort chain Anantara announced it would be offering guests a limited edition elephant-harvested coffee – priced at US$1,100 per kilogram – to target high-end gourmet appeal.

While the sale and consumption of alcohol products outside of the country’s airport and resort properties is prohibited under local law, the Maldives National Chamber of Commerce and Industries (MNNCI) said there remained definite potential for local industry and crafts to profit in a market like INIA, despite the MNNCI’s “concerns” over the development.

According to the Moodie Report, an influential travel retail publication, one Chinese passenger travelling through INIA this month purchased the limited edition commemorative Balvenie Fifty whisky just nine days after it had gone on sale at the site. Only 88 bottles are said to have been produced.

“With the Maldives being a top luxury travel destination in the Indian Sub-Continent, we believe that Malé duty free can act as a gateway to the great collection of rare and vintage malts,” distiller William Grant and Sons’ Indian Sub-Continent Brand Development Manager Neeraj Sharma told the trade publication.

GMR, the Indian infrastructure group with a concession agreement to manage and develop the new airport terminal and retail facilities, has taken exclusive rights to certain duty free items to be sold at INIA.

However the GMR contract, which was drafted with assistance from International Finance Corporation (IFC), has come under intense criticism in the country’s political circles, with some key MPs and now government-aligned parties accusing the company of corruption and seeking to “enslave the nation and its economy”.

GMR has denied the charge, contending that it is contracted to operate as a caretaker for the site, which continues to remain Maldivian owned.

However, in the same week when INIA was selling the exclusive whisky to a passenger, local groups supporting a move to “re-nationalise” the airport continued to campaign to sway public opinion against the developer, releasing a large balloon in the capital adorned with the message “go home GMR”.

The government and GMR are presently involved in an arbitration case in Singapore concerning GMR’s levying of an airport development charge.

Authentically Maldivian

MNCCI Vice President Ishmael Asif said aside from selling exclusive duty free goods, local manufacturers of products such as wood carvings and traditional clothing could also benefit from operating in INIA.  However, Asif stressed that local laws needed to be amended accordingly.

“There are no local laws right now protecting authentic Maldives products. The goods being sold as Maldivian often come from other countries and do not reflect our traditions and culture,” he claimed, pointing to the types of products sold in stores on busy retail streets like Chaandhanee Magu in Male’ as an example.

Asif claimed that legislation outlining quality and production standards could greatly boost the profitability and market for local techniques such as wood carvings of fish and dhonis (local boats) as well as smaller items like drums used in bodu beru – a local musical form combining rhythmic drumming and dancing.

According to the MNCCI, factories previously existed during the 1990’s specialising in such local woodworking techniques, which used paints and fabrics derived from local materials and colourings. Asif claimed that these factories were no longer in operation outside of some specialist operations supported by resorts based in Baa Atoll.

“We have been trying to work on a special logo that can be used to identify local Maldivian products, this is something that could be done and used at the airport,” said Asif.

The MNCCI added that in recent years, specialist retail groups had set up operations to try and provide authentic products to the country’s lucrative tourism trade, but had more recently struggled to maintain a property in the capital. The commerce group added that organisations such as the UN were now being sought to provide support to such enterprises to help maintain local cultural practices.

In terms of high-end luxury products, Asif added that traditionally INIA – formerly Male’ international Airport – had been viewed locally as a way to bring tourists to the country, rather than as a means of making money as a retail location.

“We are known [as a destination] for having expensive resorts, and the Maldives has tried to develop the best resorts in the world,” he claimed.  “GMR seem to feel this is only a place for the elite, [while] we need to accommodate everyone.”

GMR said that as part of a redevelopment of the existing airport terminal, new restaurant properties providing fast food and Thai specialities – particularly popular with Maldivians – would be opened to both passengers and local people.

Yet despite the untapped retail potential for Maldivian products at INIA, the MNNCI said it held “concerns” over the airport agreement with GMR, which was signed with the previous government, and complained it had not been consulted about developing local retail potential.

Asif has previously said that the MNNCI held concerns about the impact of the GMR deal on local businesses, alleging that a planning council related to the infrastructure group’s bid had not been open to the public or its members.

He pointed to the case of local enterprises such as MVK Maldives Private Limited, which in December last year was ordered by the Civil Court to vacate the Alpha MVKB Duty Free shop based at INIA after its agreement had expired.

However, speaking to private broadcaster Raaje TV last month, former Economic Development Minister Mahmoud Razee, who worked with the previous government and international partners on the GMR agreement, denied the deal had resulted in local enterprises being kicked out.

“The privatisation policy does not itself kick others out. It is about honouring the contract. No one has actually been kicked out, but private parties have opportunities to participate. The issue that has always existed is getting cheap capital for small scale businesses,” he said at the time.

Razee claimed that the GMR deal reflected a commitment by the former government to pursue privatisation as outlined in the Maldivian Democratic Party’s (MDP’s) manifesto.

“Firstly, if or when anything is run like a business, private people are more skilled and efficient. They are far more competent and they work for profit unlike the government,” he claimed.  “This means it requires less cost for the government, but needs more outside investment or capital. Private people are more skilled and efficient in terms of managing. The end product thus is more beneficial.”

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Driver receives minor injuries after driving off airport runway

A Maldivian national received minor injuries today after losing control of a vehicle on the runway of Ibrahim Nasir International Airport (INIA) that crashed into the site’s surrounding waters, local media has reported.

Police confirmed that only one person was in the vehicle during the time of the incident, which occurred at about 11:30am today.  Officials at the airport said the driver, who was taken to Hulhumale’ Hospital for treatment, had not been seriously injured, according to local newspaper Haveeru.

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