Tag: Local Councils

Parliament approves new Elections Commission member, ambassador to Pakistan

Parliament today approved President Abdulla Yameen’s nominees for a vacant seat on the Elections Commission (EC) and the new ambassador to Pakistan.

Former Human Rights Commission of Maldives President Ahmed Saleem was approved as the ambassador to Pakistan whilst Ahmed Akram was appointed to the EC.

Saleem had also served at the foreign ministry, the Maldives High Commission in Sri Lanka, and the Maldives’ permanent mission to the UN in New York.

Both nominees were approved unanimously with 53 votes in favour. Opposition MPs did not participate in the vote.

Akram was previously the deputy secretary-general of the Maldivian Democratic Party (MDP) and is reportedly related to the wife of the party’s former chairperson, MP ‘Reeko’ Moosa Manik, who was expelled from the party last year. Akram also quit the party last year.

President Yameen nominated Akram to the EC after the five-year term of a previous member expired in November.

Today’s sitting also proceeded amidst continuing protests on the People’s Majlis floor by opposition MDP MPs over the conviction of former President Mohamed Nasheed.

Preliminary debate on an amendment submitted to the constitution by government-aligned Maldives Development Alliance MP Ahmed Amir as well as voting on the president’s nominees took place amidst the opposition MPs’ protest.

Opposition MPs used whistles and megaphones to call for the release of the opposition leader.

Amir’s amendment meanwhile – which would require a three-quarters majority of the 85-member house to be passed – proposed removing clauses b) and c) from Article 231 of the Constitution.

The clauses stipulate that local councils shall be elected for a three-year term and that chairs and deputy chairs shall be elected through secret ballot by councillors.

The MP for Dhaal Kudahuvadhoo proposed specifying both the terms and process of electing chairs and deputy chairs in the Decentralisation Act.

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Funds allocated for councils in next year’s budget lower than 2014, says LGA

Local Government Authority (LGA) CEO Dr Ahmed Shukry told parliament’s budget review committee yesterday that funds allocated for city, island, and atoll councils in the 2015 state budget was lower than this year’s budget.

Shukry said the amount allocated for the Malé City Council, six atoll councils and 43 island councils was MVR25 million (US$1.6 million) less than this year.

If the requested amount is not provided, Shukry said many councils would face difficulties paying salaries and utility bills, which was already a recurring issue.

In addition to the LGA, a number of independent institutions, the National University of Maldives, and the judiciary have told the budget committee that the finance ministry has not allocated the requested amount of funds in the record MVR24.3 billion (US$1.5 billion) state budget for 2015.

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Maldives strategically unprepared for SEZs, argues former Finance Minister Inaz

The Maldives is strategically unprepared for the negative consequences of creating special economic zones (SEZs), former Finance Minister Ahmed Inaz has warned.

In an opinion piece published on newspaper Haveeru last week, Inaz argued that SEZs could worsen income inequality, deprive local councils of sources of revenue, and lead to a large influx of foreign labour.

“If [the government] wants to create special economic zones, it should prioritise solving problems in the judiciary that the entire country is concerned about as well as the budget deficit,” he wrote.

Policies concerning the SEZs should be formulated with a long term plan that looks ahead 10 to 20 years into the future, Inaz advised.

Investor confidence should be secured, he continued, for which laws needed to be reviewed through political dialogue.

Speaking at a forum on SEZs last week, Maldives Monetary Authority Governor Dr Azeema Adam also cautioned that political consensus was necessary for SEZs to be successful and stressed the importance of a long term strategic plan.

President Abdulla Yameen ratified the SEZ Act on September 1, which he has said would “transform” the economy through diversification, whilst relaxed regulations and tax concessions were necessary to attract foreign investors and launch ‘mega projects’ to mitigate the reliance on the tourism industry.

Inaz meanwhile predicted that a population of foreign workers many times the size of the local population would be created with the development of SEZs.

“Problems (social, political and economic) as well as opportunities that could arise as a result of the [expatriate] population should be weighed academically and discussed and debated,” he advised.

Inaz served as finance minister during the administration of former President Mohamed Nasheed and oversaw the enactment of tax reforms in 2011.

After leaving the Maldivian Democratic Party in February 2012, Inaz told Minivan News he would “always remain independent and serving the national interest.”

Consequences of SEZs

Unlike China and other East Asian countries where SEZs were created about 50 years ago, Inaz observed that the Maldives has never been a “closed economy.”

A large and cheap labour force and rich natural resources contributed to China’s economic success, he noted.

However, he added, social scientists believe that industrial development came at the cost of social cohesion.

Moreover, large multinational companies exert undue influence over decision-making in China and other East Asian nations, Inaz suggested.

While a free market economic policy has always been pursued in the Maldives, “with the designation of separate economic zones, other regions of the Maldives would be closed economically,” Inaz wrote.

Inaz argued that policies enacted in China to integrate its economy with a globalised world were unsuited to the Maldives.

In addition to establishing infrastructure such as airports, utilities and transport networks, Inaz observed that China trained skilled workers such as engineers, accountants, and lawyers years in advance.

“The question is whether there are nearly enough Maldivians with good work ethics who would be inexpensive (compared to neighbouring countries)?” he asked.

Social and economic problems created as a result of not regulating migrant workers during the past 15 years could increase manifold with SEZs, Inaz warned.

If Maldivians were unprepared for new jobs, Inaz predicted that wages could also be adversely affected in the domestic job market.

Inequality

One of the biggest challenges facing the Maldives was income inequality and the small size of the middle class, Inaz continued, which was most evident in the regional disparities between the capital and outer atolls.

Inaz stressed that empowering local councils to generate income by utilising land and lagoons was necessary to reduce disparities.

While social security benefits reduces the income gap, Inaz warned of the negative impact on government revenue of tax exemptions for investors in SEZs.

China and Singapore created SEZs after putting the state’s fiscal affairs on a sustainable footing, he noted.

The value of the Maldivian currency deteriorated as a result of persistent budget deficits since 2004, Inaz observed, which forced the state to print money to finance deficit spending.

Consequently, the interest rate on treasury bills was now nine percent, he noted, which restricts opportunities for local businesses to partner with foreign investors in the SEZs.

“It would be unwise to establish [SEZs] without easing the burden placed on Maldivian businesses by the budget deficit and T-bill rates,” he advised.

If SEZs are created with the fiscal status quo unchanged, Inaz suggested that the government would lose sources of revenue from taxes and lease rent.

The government’s position in negotiations with potential investors would also be weak, he contended.

Inaz further argued that successive governments had been unable to improve provision of services due to a weak system of governance.

“With this reality and serious challenges, what high ground would we climb for safety from the big waves formed by opening up the whole country through a special economic zones law?” he asked.

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Bill proposed to transfer land from local councils to central government

Progressive Party of Maldives (PPM) MP Riyaz Rasheed has proposed transferring land and lagoons under local council jurisdiction or ownership to the housing ministry.

“I am proposing amendments to the Decentralisation Act to the [People’s] Majlis today because of the disputes concerning land between councils, city councils and the housing ministry, and because the existing land law and decentralisation law does not make clear enough to us who has ownership of land,” said Riyaz while presenting the legislation (Dhivehi) at yesterday’s sitting of parliament.

“Therefore, I certainly believe that the state’s property should be under one institution.”

In the ensuing debate, MPs of the opposition Maldivian Democratic Party (MDP) and Jumhooree Party (JP) accused the government of attempting to “destroy” decentralisation and render councils powerless.

The amendments would defeat the purpose of devolving decision-making powers, they contended, noting that articles 234 and 235 of the Constitution state that local councils shall have the authority to “raise funds” and “own property and incur liabilities”.

Riyaz  meanwhile argued that state assets should be under the control of the executive, alleging that councils with opposition majorities were deliberately obstructing development projects by refusing to provide land.

The deputy leader of the PPM’s parliamentary group claimed that some island councils have yet to arrange land for the fisheries ministry and youth ministry to build ice plants and sports arenas, respectively.

The current administration was “facing serious difficulties” in implementing its policies, he contended.

Following disputes between the housing ministry and councils, Riyaz noted that councils have recently been informed not to conduct transactions involving state-owned land or lease property without obtaining permission from the president.

In June, the Ministry of Housing and Infrastructure removed two parks from the jurisdiction of the MDP-majority Malé City Council, while Dharubaaruge convention centre was reclaimed by the government in May.

Riyaz also criticised the city council for leasing parks in the capital for restaurant businesses. While councils should have authority over land, Riyaz said the law should not allow that power to be misused.

“It should be done in accordance with the government’s policies,” he insisted.

“Toothless”

During the debate, MDP MP Abdul Ghafoor Moosa said the amendments would make councils “toothless” and the decentralisation law “useless.”

Ghafoor denied Riyaz’s allegations of non-cooperation from MDP-majority councils, adding that the claims were intended to “mislead” the public.

JP MPs also noted that property and lagoons under council ownership were the only significant means available for generating an income.

MDP MP Rozaina Adam said the government was trying to “cut off the arms and legs” of councils as they would not be able to do “any work when the government steals land from small islands.”

Several MPs suggested that there were many island councils doing exemplary work for the benefit and development of their islands or atolls. All local councils should not be punished or blamed for the actions of a few, the MPs said.

JP MP Hussain Shahid suggested amending the law to allow councils to function more efficiently, arguing that the number of councillors in each island were excessive.

The current model of more than 1,000 elected councillors approved in 2010 by the then-opposition majority parliament was branded “economic sabotage” by the MDP government, which had proposed limiting the number of councillors to “no more than 220.”

Following the release of the UNDP’s second Human Development Index report in June – which found the rest of the country lagging behind the Malé area with its ‘highly developed’ score – Salma Fikry, a prominent campaigner and proponent of decentralisation, told Minivan News that lack of political will was to blame for the disparity.

“The whole point of decentralisation is scary for the Maldivian government because they like to keep people dependent, they like to think of themselves as doing people favours,” she said.

She predicted that “three quarters of the population would probably move to the capital and the rest of the country will be taken over by the corporations.”

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MDP condemns restriction of powers of local councils

The opposition Maldivian Democratic Party (MDP) has strongly condemned a decision by the government requiring local councils to seek permission directly from the president for conducting transactions involving state-owned land.

In a press release yesterday, the main opposition party said it was “extremely concerned” with moves by the current administration to restrict and limit powers and authority of island, city, and atoll councils.

As conducting transactions involving plots of land under council jurisdiction was one of the main tasks of local councils, the party contended that the government’s intention was to undermine the system of decentralisation introduced by the landmark Decentralisation Act in 2010 through devolution of decision-making powers.

The decision would undermine the authority to generate income and own land granted to local councils by the constitution, the MDP statement added.

Articles 234 and 235 states that local councils shall have the authority to “raise funds” and “own property and incur liabilities”.

In June, the Ministry of Housing and Infrastructure removed two parks from the jurisdiction of the MDP-majority Malé City Council, while Dharubaaruge convention centre was reclaimed by the government in May.

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Parliamentary debate begins on special economic zones bill

Preliminary debate on the government’s flagship special economic zones (SEZs) legislation began today with opposition Maldivian Democratic Party (MDP) MPs warning that the envisaged law could turn the Maldives into a haven for “money laundering and washing black money.”

If the bill is passed into law, the government could hand out uninhabited islands or plots of land for periods, prices, and terms of its choosing without either parliamentary oversight or a role for local councils, contended MDP MP Ibrahim Shareef.

“The Maldives could become a machine for money laundering and turning black money white,” he added.

If the country becomes a money laundering destination for international criminal enterprises, Shareef warned that developed nations could impose sanctions on the Maldives.

Shareef also expressed concern with the impact of tax exemptions for investors in the SEZs on the local tourism industry.

Among other MDP MPs who spoke during the debate, MP Ahmed Nashid noted that the bill “supersedes” 14 other laws while MP Abdul Gafoor Moosa insisted that the legislation should be amended with the input of the main opposition party.

Speaking at an MDP gathering last week, former President Mohamed Nasheed had dubbed the SEZ legislation the “Artur Brothers bill,” referring to the infamous Armenians linked with money laundering and drug trafficking who made headlines in Maldivian media last year after they were photographed with cabinet ministers.

Nasheed claimed that the zones are intended for criminal activity, money laundering, gambling, and “other irreligious activities.”

The Maldivian government’s liaison officer in Addu during British occupation of Gan island had more authority and freedom than what the government would have in the SEZs, Nasheed contended.

Debate

Introducing the 70-page draft legislation (Dhivehi), MP Ahmed Nihan – parliamentary group leader of the ruling Progressive Party of Maldives (PPM) – stressed that the bill includes provisions for terminating agreements with investors if an act of corruption specified in the International Convention against Corruption is proved.

The MP for Vilimale’ appealed for “cooperation and assistance” from opposition MPs in reviewing the legislation and addressing shortcomings at the committee stage.

In the ensuing debate, Jumhooree Party (JP) MP Ibrahim Hassan declared support for the legislation but suggested that the power to form a board of investment to oversee the zones should not be vested solely with the president.

JP MP Moosa Nizar Ibrahim suggested that environmental and national security concerns should be addressed, while JP Deputy Leader Ilham Ahmed said the bill contained “serious problems.”

While supporting the “concept” of SEZs, Ilham expressed concern with the bill offering tax exemptions to investors for a 10-year period and allowing uninhabited islands to be leased without advance payments.

The government would not receive any revenue from investors during the 10-year period, he noted, while investors would enjoy subsidised staple foodstuffs.

Incentives

PPM MP Jameel Usman argued that the bill was intended to assure investor confidence and offer incentives to choose the Maldives over other developing economies in the region.

SEZs in the Dominican Republic and Philippines created thousands of jobs, noted PPM MP Abdulla Rifau, suggesting that new jobs for Maldivian youth would make up for lost tax revenue.

Moreover, the bill requires investors to carry out corporate social responsibility (CSR) projects, he added.

Incentives for investors offered in the bill include tax exemptions and relaxed regulations for employing foreign labour.

Investors would be exempted from paying either import duties for capital goods or business profit tax, goods and services tax and withholding tax.

Moreover, regulations on foreign workers would be relaxed while companies with foreign shareholders would be allowed to purchase land without paying privatisation fees or sales tax.

Geographical areas or regions declared an SEZ by the president would also be removed from the jurisdiction of local councils.

The nine SEZs envisioned in the bill includes an industrial estate zone, export processing zone, free trade zone, enterprise zone, free port zone, single factory export processing zone, offshore banking unit zone, offshore financial services centre zone, and a high technology park zone.

President Abdulla Yameen had declared in April that the SEZ bill would become “a landmark law” that would strengthen the country’s foreign investment regime.

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Government plotting to “destroy decentralization,” says Malé Deputy Mayor

The Housing Ministry’s efforts to appropriate lands and property under the Malé City Council is an organized effort to discredit the council, destroy the decentralization system and punish Malé citizens for voting for the opposition Maldivian Democratic Party (MDP), Deputy Mayor Shifa Mohamed has said today.

Since the takeover of the Dharubaaruge Conference Center, the ministry has asked for the hand over of two additional parks developed by the council, Shifa told Minivan News.

“This is an organized joint effort by the ministry and the government to discredit the council and destroy the decentralization system. When taking back lands [from the city council] is among the very the first decisions of the cabinet, it can also be seen as a revenge against people living in Malé, and people from all over the country who are living in the city. I dont think Malé citizens deserve this spirit of revenge from the government for voting for the MDP,” she said.

The ministry’s official reason for taking over the parks is “unlawful activity” taking place at the parks, but Shifa said the ministry failed to provide details of such activities.

The council had developed the two parks – Fini Park or Bondibai Park and City Park – with cafeteria services in 2012 in order to prevent drug dealing and criminal activity, Shifa said, accusing the government of taking back the parks to reverse gains.

President Abdulla Yameen’s administration is preventing the council from serving the people of Malé, she added.

“Even earlier [with Dharubaaruge and other lands] they could not give a valid reason or explanation. They just said it was based on the Attorney General’s advice which no one has ever seen. This time they say are saying unlawful activity without telling us what these activities are,” she said.

Police involvement

Council Member Shamau Shareef told local media yesterday that the Maldives Police Service was not cooperating with the council to clear out gang hangouts in Malé City’s public spaces. The police are “afraid to touch” such areas, Shamau claimed.

In response, the police said the council had not issued an official permit requesting action.

The council yesterday sent a letter requesting Commissioner of Police Hussain Waheed to stop police participation in Dharubaaruge takeover without a court warrant, and asked him to investigate the incident.

No plan for development

In an official statement released yesterday, the council said the government is appropriating lands and property under the council without any plans for development and said the ministry has confirmed the absence of such a plan to the council in writing.

Regulations on transfer of lands between the local and central government states the government is authorized to take over land from the councils on a cabinet decision for socio- economic purposes and national security purposes.

The ministry also intends to take over the artificial beach, carnival area, south harbour area, lands near the T-Jetty and Usfasgandu area on the city’s southeast.

The council condemned the “unlawful takeover,” noting that the police and housing ministry officials who entered and changed Dharubaaruge locks yesterday had done so without a court warrant or any official document indicating the center had been transferred to the ministry.

The council called on President Yameen and senior members of the government to take action against such unlawful actions and asked the government to ensure the implementation of its policies would not harm the citizens of Malé City.

The statement also explained that the Ministry of Finance and Treasury rejected the council’s request in December 2012 for funds to repair a badly damaged and deteriorating Dharubaaruge.

According to the council they were asked to utilize funds allocated for the council in 2013, and the council informed the ministry the funds were insufficient for repair. However, the ministry refused to release additional funds, the council claimed. Copies of the letters was shared with the media.

When funds were denied, the council handed over the maintenance and development of Dharubaaruge to a private company, under a public-private partnership agreement through a public bidding process.

The council statement also said the ministry’s actions were “without any respect to the legal contract between the council and a private party” and without considering  how the action may affect members of the public.

Although MDP dominates the council, a council member from the ruling Progressive Party of Maldives (PPM) Zaidul Ameen has also condemned yesterday’s incident.

The MDP has on several occasions accused the ruling PPM of opposing decentralization and said their policies reflect the party’s founder President Maumoon Abdul Gayoom’s centralized policies.

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Home Ministry to share DNR database with local councils

The Home Ministry has signed an agreement with the Local Government Authority (LGA) to share the Department of National Registration’s [DNR] database with local councils.

Home Minister Umar Naseer and President of LGA Mohamed Nazim, who is also the Defence Minister, signed the agreement yesterday.

The agreement’s purpose is to establish a system where atoll councils and island councils can obtain information of people such as date of birth or give identity card numbers to newborn babies and also determine dead people, Naseer said.

However, councils will not be able to edit any of the information on the database, Naseer said while Nazim said the database had very strong security features.

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MDP will empower local councils: Nasheed

Former president Mohamed Nasheed has said the opposition Maldivian Democratic Party (MDP) will not allow the Maldives to become a “unitary state” and will empower local councils.

Speaking at an MDP rally held last night at Alimas Carnival area in Male’, Nasheed said that if MDP wins majority of the seats in the parliament, the party will arrange an uninhabited island for every council and provide councils with the means of making an income.

He said MDP will work within the parliament to ensure councils are given the authority to utilize land, and with that councils will fulfill the pledge of providing citizens with housing.

He noted the importance of allowing the councils to have the funds they earn in their own accounts.

Nasheed said the MDP accepted the presidential election result knowing that it was achieved through a court, and will work twice as hard to win the upcoming local council and parliament elections.

He announced his plans to visit every inhabited island of Maldives before 22 March.

“Maldives is clearly proving that a coalition government have no place under the constitution, President Yameen cannot rule except with the twenty six percent he won.” Nasheed said, reiterating his criticism of coalition governments.

President Abdulla Yameen Abdul Gayoom won 25.35 percent of the vote in the first round of presidential elections held on September 7. The Supreme Court subsequently annulled the election and ordered a revote. Yameen’s Progressive Party of the Maldives (PPM) won in the second round with 51.39 percent of the vote after third-placed candidate Gasim Ibrahim backed the PPM.

People’s Majlis Speaker Abdulla Shahid also echoed Nasheed’s concerns over the state of local governance in the Maldives.

Describing decentralization as the biggest changed brought about by the 2008 constitution, Shahid accused then opposition parties of confusing the meaning of the decentralization act.

MDP candidates for local councils were announced at last night’s rally. The local council elections will be held on January 18 and Parliamentary elections are scheduled for March 22.

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