maldives – Page 348 – Minivan News

Maldives facing widespread child prostitution, sexual abuse: clinical psychologist

Additional reporting by Ahmed Naish

Child prostitution in Laamu Atoll has become so “common” the underage victims of such crimes consider it “normal”, a private clinical psychologist has revealed to Minivan News.

The practice, believed by multiple sources interviewed by Minivan News to be prevalent across the Maldives, ranges from male benefactors grooming children with ‘gifts’ to parents actively selling the sexual services of their children – some as young as 12.

Acknowledgement of “systemic” child sexual abuse in the Maldives, particularly prostitution, remains highly taboo, with few government institutions willing to confront the problem.

Minister of Gender, Family and Human Rights Azima Shukoor made the first official acknowledgement of the practice in a statement to mark Children’s Day on May 10.

“The abuse of children is on the rise. Children being used as sex workers, where the children are sent to places as a means to pleasure people and to gain an income from such a trade. This is being practiced in the Maldives today. Both boys and girls are being used in this trade,” she stated.

Consultant Clinical Psychologist Maldives Institute for Psychological Services, Training & Research (MIPSTAR), Dr Aishath Ali Naaz, conducts psychological profiling of sexual abuse victims, as well as preventative awareness workshops, and recently completed a study focusing on Laamu Atoll.

She explained that child prostitution has become so common among minors that it is considered a normal activity, with victims even boasting about their sexual exploits at school.

“When many people do something it’s not [considered] wrong anymore. In some atolls I’ve seen this, especially in Laamu Atoll. It’s not accepted by the whole population but [it is] among the young people,” she told Minivan News.

“The children say in class ‘So you do it, you do it too, and so on, so what’s the big deal?’” Dr Naaz explained. “Some children have accepted this as something normal and as a way of life.”

Child prostitution is considered a type of sexual abuse because victims are minors under 18 years-old.

“It’s not just incest, which is happening, because in my practice I have come across cases of close relatives [who] have pushed children into prostitution,” Dr Naaz said. “Children as young as 12 or 13 years-old have been forced to partake in sexual activities,” explained Dr Naaz.

“This is sexual abuse, but people are not aware that there is sometimes monetary gain for somebody,” she added.

“Child prostitution is happening in a very subtle way. Most of the time there is an adult who is pushing the child; it may be a parent or a relative who is pimping the child,” said Dr Naaz.

Hidden in plain sight

Two cases of child prostitution in Laamu Atoll have been reported to police so far in 2012, a police source familiar with the incidents told Minivan News, on condition of anonymity.

The cases were “isolated, very difficult to [investigate]”, and there did not appear to be gang involvement or organised child prostitution ‘rings’, the source explained. The victims of child prostitution in the atoll were “typically 16 or 17 years-old”.

An island council official in Laamu Atoll told Minivan News child prostitution was resorted to by the “poorest of the poor” as a means to earn money to “fulfill basic needs of living.”

Child sexual abuse and incest occurring within some families has led to the practice being passed down through multiple generations, a civil society source researching the matter explained to Minivan News.

This history of sexual abuse has been exacerbated by overcrowding in homes following relocations after the 2004 tsunami, which in combination with severe economic hardship has led to the exploitation of children via prostitution.

During a visit to Laamu Atoll, Minivan News spoke to 51 year-old former atoll chief Abdul Wahhab Abdulla about the practice in the atoll.

Wahhab served as island chief of Gan for 25 years, atoll chief from 2008 to 2010, and was director general at the national administrative office of the South Central Province from 2011 to March 2012. He was subsequently demoted to island council director after March 2012.

Reported cases of child prostitution in the atoll were “very rare”, Wahhab said, “perhaps one case a year.”

There have been cases of middle aged or elderly men providing financial support to young girls for basic necessities “and then taking advantage of the position [of benefactor],” he explained.

“It is less child prostitution than sexual abuse,” he continued. “I think it started after the tsunami after affected people from Mundhoo and Kalaidhoo [islands] migrated here.”

There were about four such cases of sexual abuse reported a year, he said.

In the past, Wahhab explained, island communities were smaller and people knew each other very well, making it difficult to hide crimes such as prostitution.

Reported cases typically involved low income families “with four or five children”, he said, with adolescent girls aged 16-17 often targeted.

“The children have basic needs that are not being fulfilled, so the elderly man will first gain the child’s trust with small gifts,” he explained.

“At that point he becomes her benefactor. Then he gets closer and tries to take advantage of the girl. And the girl does not have the capacity or courage to resist,” he said.

The gender department and police child and family protection services had attended to reported cases promptly, he added.

Atoll sex behaviour survey suppressed

In 2010, the gender department conducted a biological behaviour survey in Laamu Atoll focusing on child sexual abuse, homosexuality and drug use, explained the former atoll chief.

The results of the survey – which were never made public – suggested that the incidence of child abuse and homosexuality were much higher than previously expected, according to Wahhab.

The survey did not distinguish that child prostitution was occurring in Laamu Atoll at the time, he added.

Systemic exploitation nationwide

While children prostitution is more pronounced in some atolls than others, it is “a systemic problem” across the country and remains “a very, very hidden activity,” Dr Naaz explained.

The almost 10,000 participants of her sexual abuse and violence prevention workshops over the past two years had expressed particular concern that child sexual abuse, including child prostitution – is “a common problem”.

Communities from the far north to the south of the Maldives – including Male’, Haa Dhaal, Raa, Lhaviyani, and Addu Atolls – have also been affected, she said.

“People quite frequently talk about child sexual abuse, but we are not comfortable facing the finer details of this reality,” said Dr Naaz.

It was a misconception to think that Maldivians were not involved in the child sex trade, as it was “hidden and difficult to capture,” she said.

“There are people who are using young Maldivian girls in this trade, but it may not be happening at a guest house,” she explained.

Instead, this sexual exploitation occurs “more on [the victim’s] own familiar ground, in rooms and houses”, making it difficult for the authorities to identify cases, collect evidence and intervene.

The involvement of young boys in child prostitution “cannot be ruled out”, however the practice “may be even more hidden”, she added.

Children are being forced to cater to both Maldivians and expatriate workers, she said, however the rates varied with Maldivians paying upwards of MVR 700 (US$45.60) while foreigners such as Bangladeshi labourers paid MVR 150 (US$9.77) “for sexual everything”, explained Dr Naaz.

“These girls have described that the people who pay for sex with them are often very young – 21 to 25 years-old – but sometimes include elderly people,” she continued, noting that the practice had increased in the past decade.

Sophisticated industry in Male’

In the capital Male’, child prostitution has reached a “sophisticated level” and encompasses different types of sexual abuse, explained Dr Naaz, with an even split between families pimping out their children for economic gain versus gangs facilitating the trade for girls suffering from substance abuse problems.

Rather than being gang-led phenomenon, families struggling to make ends meet and economic hardship had led to the rise of a generally ad hoc child sex industry.

“There are instances where family members may hire a room for rent, keep the children in there, and then use them to generate money through sexual activity so they can support their stay in Male’,” explained Dr Naaz.

“Many times the parent, uncle or sibling may be involved in drug abuse and in order to get money they introduce the children to the trade,” said Dr Naaz. “On the other hand, you have people deliberately using and recruiting young girls into this and involving them in sex.”

“Sometimes – and I don’t want to put the on blame them, because it’s not every gang – there are youth groups who may keep a few girls whom they pimp.”

She also highlighted instances of mentally disabled children being abused for sexual activities by adults.

“They’re vulnerable so they’re not able to protect themselves,” she said.

Other cases were said to involve groups of women renting rooms in Male’ and “recruiting vulnerable young people who may not have their parents [in the city],” she explained. In some cases, young girls with intellectual impairments “are taken in by these groups of women.”

She identified a “gradual process” of minors being “groomed” by adults via the internet and/or social media, with children taken to known “spots” and introduced to those involved in the sex trade.

In other instances, the minors are pushed to provide nude photos, and then emotionally blackmailed with threats that the pictures will be posted on the web, and ultimately recruited into prostitution.

“In Male’, there have [also] been instances where a parent gets angry and tells the child to get out on the street, with the child picked up by somebody [because they are] in a helpless state,” said Dr Naaz. “Then they are taken to a guest house and used for prostitution, group sex and things like that.”

A school health counselor in Male’, who claimed to have encountered numerous cases of child prostitution, said poverty was one of the root causes of the abuse in Male.

“Mostly cases involve single parents – mums and dads – who come from the islands and try to survive in Male’,” said the counselor. “Cases where the mom lives in a guest house and facilitates prostitution for the whole family are common in Male’.”

In one specific instance, a student in Grade 7 (aged 12-13) and her sister were earning money from prostitution and giving the earnings to the family, with the parent’s knowledge, the source said.

“Children are [also] trafficked to the islands from Male’. The gender ministry cannot do anything regarding the kids because this happens at the family level and at the school level. They have no authority to say anything and are neglecting the issue,” the source alleged.

A civil society source currently investigating the practice told Minivan News that underage girls were being “groomed” by “benefactors” in Male’ and then sexually abused by the same men, which included both Maldivians and foreign nationals. The source said it is common to see teenage or adolescent girls with older men who were trying to buy sexual favors at particular shops in Male’ at the beginning of the month, around payday.

After being lured into prostitution, the children were then taken by some men to neighboring countries to engage in sexual acts, added the source.

Generations of damage

Some of the children exploited by the sex trade seek help, but the condition they are in is “very very sad”, lamented Dr Naaz. “It’s unbelievable for the Maldives.”

“Sometimes they are psychotic, mentally retarded, and they are the victims of rape, gang rape, group sex… and the child feels ‘I have no choice but to be there’ because their intellectual capacity is not [developed enough] to address that. They don’t have the skills [to get out of the situation],” she explained.

Some children also showed symptoms of sexually transmitted diseases and were being advised to seek testing and treatment, she added.

A comprehensive study is needed to determine exactly how many children are affected by this type of sexual abuse, emphasised Dr Naaz.

“I don’t think we would be different from most other societies, but the exact percentage we should determine from good research that determines the root causes,” she said.

While the exact root causes behind child prostitution – and other forms of sexual abuse – in the Maldives still need to be determined, there are some factors in addition to economic hardship that may be contributing to the practice.

“Many times Maldivians are living in very crowded environments in households where they are exposed to adult sexual activities and children learn, children get to know,” Dr Naaz speculated. “So the environment in which we are living could be one factor.”

Furthermore, “in the Maldives girls start having boyfriends at a very young age, grade 5 or 6, which is quite early. It seems more like people are indulging in sexual activities at a very young age,” she explained. “Sometimes these boyfriends may be on drugs and these boys may also be recruiting the girls into sexual activities. Young girls need to be very careful so they don’t get pushed into this.”

Children’s rights violated

Children are not aware of their rights and are not being taught or given opportunities to develop the proper social skills to protect themselves from attempted sexual abuse, including child prostitution, multiple sources emphasised to Minivan News.

“Young people should know their body is theirs and that nobody has a right to violate it. No one – no one – can violate it and there are other ways to earn money,” said Dr Naaz.

“We have to tell young people it’s not alright if your aunt [or anyone] says ‘go to that room with this boy’. Children need to be taught that this is wrong, that these are their rights that are being violated,” she emphasised. “Sometimes children don’t know this, or that they have the right to report [abuse].”

“Parents have a huge role to play, we have to monitor where our children are going. If they’re missing for long hours, we need to know where they are, and whether someone is abusing the freedom their parents have given them,” she continued.

“The child is a minor, so they may not be able to say no if they get pushed into this,” she added.

A ‘Happy Star’ program, created by Dr Naaz, details how parents can communicate to their children – in a language appropriate to children – to improve awareness about the dangers of being lured or forced into child prostitution.

She emphasised that relevant programs must be developed to protect children and teach them about their rights.

“There is a general erosion of values. People don’t seem to know where to set their limits or draw the line. We need to get back to our old values,” she said.

“When a young boy is going to school saying ‘I can’t even say my mum is not doing it, my mum is sleeping with my friend’, that reflects an erosion of values,” she said.

The civil society source investigating the practice of prostitution among young people emphasised that parents and children are “not prepared to deal with these things”.

In addition to no effective sexual education taking place, “There is also no social education occurring and when children get older they rebel because they are not given the chance to be children – instead they are forced to take tuition from age four instead of having play time,” said the source.

“There are parents trying to bring up good kids, but the victims drag other children into their bad behavior,” the source continued.

“We are neglecting the issue, making it worse because no one is dealing with these things. Hiding the issue encourages the practice to continue,” the source declared.

“This has to come out and we have to think ‘out of the box’ to stop the root causes – not just do the same things over and over,” the source added.

Authorities, government uncooperative

The Maldives Police Service had not responded to an emailed series of questions at time of press.

Meanwhile, despite stating earlier this year that the abuse and neglect of children had reached “alarming levels“, the Gender Ministry failed to respond to multiple enquiries from Minivan News regarding child prostitution over the course of this investigation.

Further interviews arranged with relevant authorities in Laamu Atoll were curtailed by the Ministry in Male, with Minivan News ordered to submit a formal letter of enquiry to the office in Male’ requesting authorisation for its staff to speak.

Minivan News submitted such a letter to the Ministry on June 16 seeking “all relevant information regarding the occurrence of child prostitution” in Laamu Atoll and nationwide, as well as a copy of the Laamu Atoll survey conducted in 2010. At time of press, the Ministry had made no response.

Minivan News also contacted Minister of Gender, Family, and Human Rights Azima Shukoor, who did not respond to calls or text messages.

State Minister Dr Aishath Rameela was also not responding to calls at time of press. Minivan News attended her office to set up an appointment directly on Wednesday (June 19), but was informed by Dr Rameela’s secretary that she was unavailable for interview because she was “very busy”.

Victims or suspected victims of sexual abuse, including child prostitution, in Laamu Atoll, can reach the Hadhdhunmathi Family and Children Service Centre on Fonadhoo Island via 771-1721 ,or by calling the Maldives Police Services at 119.

Additionally, a 24 hour toll-free Maldives Child Helpline is available on 1412.

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Hong Kong court sentences Maldivian man to life imprisonment for murder of British woman

A 31 year-old Maldivian man has been sentenced to life imprisonment in Hong Kong for the murder of 64 year-old British woman Janet Gilson, a retired major in the Salvation Army.

Ahmed Fareed was arrested by Hong Kong police in March 2011 after the discovery of Janet Gilson’s body under a sofa in a flat belonging to her niece, Julia Fareed – the estranged wife of the accused.

During sentencing at Hong Kong’s Court of First Instance on Thursday (June 20), the presiding judge described Fareed as being “highly dangerous”, stating that the crime was a most brutal killing of a woman aged 64 who had done no harm to the defendant, the South China Morning Post reported.

Sentencing Fareed to life imprisonment, the judge said no motive had been established for the killing of Gilson.

During the trial, the jury heard that the accused had been previously barred via a court order from entering his wife’s home over concerns about his temper.

Media reported that the jury were told during the six day trial how Fareed stood accused of tying up Gilson with rope, before hitting her hard on her forehead. He was then accused of suffocating the victim by stuffing a towel in her mouth while she was still alive. Gilson’s body was later discovered with four broken ribs after being recovered by authorities.

The judge also accused Fareed of committing a calculated murder after the jury were told how he had sent a text message from Gilson’s phone telling her niece she had travelled to Aberdeen in Scotland.

The jury were unanimous in declaring Fareed guilty of the crime.

“Ultimate sacrifice”

Speaking to media after the trial, Julia Fareed praised her late aunt for the “ultimate sacrifice” she had made to allow both herself and her daughter to leave her ex-husband “without fear”.

“To those people that are in relationships with violent partners: I strongly urge you to get away, putting [yourselves at a] sufficient distance to end matters peacefully,” she was quoted as saying.

“I made the mistake of believing I could help change my ex-husband, giving him many chances,” she said. “I realise the error of that judgement now and hope that others can also learn from that.”

Speaking to local media today, Fareed’s family in the Maldives expressed “shock” at the life sentence passed by the Hong Kong court.

Ramzee Mohamed, Fareed’s brother, told Haveeru that his family had previously been informed by the Foreign Ministry that there was insufficient evidence to secure a conviction.

Ramzee claimed Fareed had also never displayed any behaviour in line with the violent nature of the attack, adding that his family did not understand why he attacked the victim instead of his ex-wife.

“He had problems with his wife. So it’s difficult to understand why he would murder her aunt. It’s difficult to believe. But when a court has passed the judgement, what can we do? We could appeal the judgment if it was the Maldives,” he was quoted as saying.

According to Haveeru, Fareed’s family also accused his ex-wife of influencing the trial, alleging she was “extremely influential” in Honk Kong, but without clarifying further.

A Foreign Ministry spokesperson confirmed today that no official notice had been received informing them of the outcome of the trial.

“We have not received a letter yet confirming the verdict, as it was announced over the weekend here,” the spokesperson said today. “However, I think we will get the verdict soon.”

The Foreign Ministry said that in cases where Maldives nationals were imprisoned of facing trial abroad, it was required to provide assistance such as establishing communications with their family.

“From the start of this case, we have been in contact [with Fareed] through our Chinese Embassy and honorary consulate in Hong Kong to provide services like translation and to keep him in touch with his family,” said the spokesperson.

The Foreign Ministry spokesperson said that the Maldives itself had no agreements with Chinese authorities regarding the transfer of prisoners in custody, adding that Fareed would be expected to serve his sentence in Hong Kong “for the time being”.

Fareed’s arrest

Fareed was arrested in March 2011 on Hong Kong pier after Janet Gilson’s body had been found during a second search of her niece’s flat. Gilson went missing on March 15, 10 days after arriving in Hong Kong. The body was reported to have severe head injuries when discovered.

Local media in the UK reported that Gilson was a long-serving Major in the British branch of the Salvation Army, an international Christian institution with a quasi-military structure known for its charitable work and rehabilitation of alcoholics and drug addicts, and had worked for 40 years as a Christian missionary.

“She had stopped the missionary work but she was still active and in a very high position [in the Salvation Army],” Gilson’s neighbour in her home of Leigh-on-Sea told local media at the time.

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UN translates Special Rapporteur’s report on judiciary into Dhivehi

The UN has released an unofficial Dhivehi translation of Special Rapporteur Gabriela Knaul’s extensive report on the state of the Maldivian judiciary.

In her report, Knaul expressed “deep concern” over the failure of the judicial system to address “serious violations of human rights” during the Maldives’ 30 year dictatorship, warning of “more instability and unrest” should this continue to be neglected.

The report is a comprehensive overview of the state of the Maldivian judiciary and its watchdog body, the Judicial Services Commission (JSC). Knaul examines the judiciary’s handling of the trial of former President Nasheed, the controversial reappointment of unqualified judges in 2010, and the politicisation of the JSC.

Knaul also examines parliament’s failure to pass critical pieces of legislation needed for the proper functioning of the judiciary and “legal certainty”, as well as raises serious concerns about an impending budget catastrophe facing the judicial system.

Read the translation (Dhivehi)

Read the original report (English)

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Female resort worker dies after being hit by dive boat propeller

A 27 year-old female resort worker died yesterday after she was hit by the propeller of a diving boat near the island of Hinmafushi.

Police said Aishath Safa, who worked as a telephone operator at the Four Seasons Kudu Huraa resort 20 minutes from Male’, was hit by the propeller while on a diving excursion after the boat pulled over to pick up another person in the water.

Four Seasons Kuda Huraa issued a statement confirming the incident, and noting that the police investigation was ongoing.

“The Senior Management of the resort extends it deepest sympathies and has offered its fullest support and assistance to the family of Ms Aishath Safa,” the statement read.

The resort stated that Safa was a certified Open Water diver and had joined the afternoon dive session on her day off from work.

During a rally last night former President Mohamed Nasheed expressed sorrow over Safa’s death and praised her contribution to campaigning for the Maldivian Democratic Party (MDP).

“Safa was a young woman who worked in numerous ways for the MDP and reform in the Maldives. May God grant her Paradise and give patience to her family,” Nasheed tweeted.

The incident is the fourth serious accident involving a boat propeller this year, and the second fatality.

On June 1, a German woman on honeymoon at Reethi Beach Resort suffered serious leg injuries after she was hit by the propeller of a dive boat.

A 51 year-old Italian woman died on January 31 while snorkeling near Elaa Island in Thaa Atoll, suffering major head injuries after she was hit by a boat propeller.

An 18 year-old Maldivian man was also seriously injured trying to disentangle a fishing line from a dhoni propeller on April 23.

Nauf Ibrahim was hit in the head by the propeller and suffered serious injuries including a skull fracture and internal bleeding. He was taken to Laamu Atoll regional hospital and later transfer to Indira Gandhi Memorial Hospital (IGMH) by Maldives National Defence Force (MNDF) helicopter.

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Criminal Court acquits six men charged with gang rape of 14 year-old girl

The Criminal Court has acquitted six men charged with the gang rape of a minor, on the grounds that the prosecution was unable to offer sufficient evidence to prove they were guilty.

Abdulla Nazeef of Fuvamulah, Mohamed Shifau of Villimale’, Azim Ali from Dhigurah in Alif Dhaalu, Hoodh Mohamed of Male’ special registry, Inash Abdulla of Gaafu Dhaalu Vaadhoo and Ali Ashraf of Maafannu Athuma were charged with the sexual abuse of a minor by a group.

The Prosecutor General’s Office pressed charges against the six suspects on allegations that on June 5, 2010, they abducted a 14 year-old girl, took her to an abandoned area near the Villimale’ antennae area, and raped the victim.

The Criminal Court stated in its verdict that the state had charged the six men under the Special Provisions for Perpetrators of Child Sex Abuse Act of 2009 but had not produced enough evidence as required by the law to declare a person guilty.

According to local media, the court’s verdict stated that the suspects were acquitted as the state had not presented the required number of witnesses to the incident.

The verdict also stated that all the defendants had denied the charges.

According to local media, two of the accused – Abdulla Nazeef and Mohamed Shifau – are among the suspects charged with the murder of Ahmed Mirza Ibrahim.

In April 2011, Mirza Ibrahim was struck in the head with an iron bar while he was sitting inside a park in Villingili, the ward of Male’ where he lived.

Mirza suffered severe head injuries in the attack and was rushed to Indira Gandi Memorial Hospital (IGMH), where he was placed on life support but later declared brain-dead.

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Parents seek help after baby born with huge birthmark on face

The parents of a baby girl born with an usually large black birthmark across her face are seeking donations for surgery to remove the scar.

The baby’s parents are from the island of Meedhoo in Dhaalu Atoll in the Maldives.

The father of the baby said doctors had advised him to go abroad to seek further medical assistance as there was little they could do to help in the Maldives.

“Doctors advised me to go for a plastic surgery,” wrote Ahmed Shareef on Facebook, posting a picture of his newborn.

“But plastic surgery is not available here in Maldives. And it costs a huge amount. Please help me in anyway you can if it is possible. Even I will appreciate your good prayers too,” he adds.

The picture has gone viral across Maldivian social media since it was posted on Thursday, and has been shared by over 5000 users. The local community – both online and offline – are rallying to raise money to help the girl.

Speaking to Minivan News on Sunday, Shareef said he had been in touch with doctors from abroad who had given a preliminary diagnosis of Congenital Nevomelanocytic Nevus (CNN).

A nevus – the medical term for a birthmark – larger than 20 centimetres in diameter only occurs once in every half a million newborns. This is the first such case reported in Maldives, which has a population of around 350,000 people.

The scar went undetected during ultra sound scans throughout the pregnancy, Shareef explained.

Although the scar is believed to be benign, there is risk of it further spreading across the baby’s face and causing complications as serious as cancer, according to the family.

“There is a chance of the scar spreading. Or even it may become cancerous. So most of the doctors are saying go for surgery,” Shareef explained.

The young couple, who also have a four-year old son, say they are extremely worried about their daughter’s future.

“Just imagine how can a girl will live here with that. Think about her future,” he said. “The only way I can help my baby is to take her abroad, consult a specialist and do the surgery. But my wife and I cannot afford the travel and costs of the treatment. Please help me,” he begged.

Shareef is a primary school teacher while his wife is a clerk at the island council office, earning less than US$800 a month between them.

Shareef said his wife also had a heart condition requiring prescriptions and regular check ups.

“Despite all this, my wife is very strong. I am doing everything I can to help my wife and daughter,” Shareef said, thanking the public for its generous support so far.

While Shareef is struggling to raise money, little support is available from the state as the national health insurance scheme does not cover expenses for plastic surgery.

The Maldives has a culture of families and friends helping to raise funds for medical treatment to save loved ones, increasingly through social media.

Recently, a young woman launched a search for a Maldivian donor for her husband whose kidneys had both failed. She recently announced that two matching donors had been found.

Similarly, parents of a child born with cleft lip and palate ran a successful campaign called “Help Lisa Smile”. The family raised money through T-shirt sales, in addition to generous donations, and the operation was successful.

For more information on this story contact Ahmed Shareef on Facebook

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Resorts hope for end to “food and beverage nightmare” as Maldives suppliers run out of gas

Resort operators and businesses across the Maldives have been forced to dramatically alter menus and even temporarily close entire restaurants after weeks of disruptions to the supply of Liquefied Petroleum Gas (LPG).

The general manager of one exclusive resort told Minivan News that LPG shortage had created a “food and beverage nightmare” over the last three weeks.

“Comedy of errors”

Maldive Gas, a major supplier of cooking gas to both resort operators and restaurants across the country’s inhabited islands, released a statement (Dhivehi) on Thursday (June 20) saying it expected the LPG issue to be resolved today.

Apologising to its customers, Maldive Gas stated that it had been forced to ration LPG to clients to avoid running out, citing a malfunction in the engine of a cargo vessel bringing a shipment to the Maldives as the reason for the issue.

Asked whether the company had resolved the LPG shortage today as promised, Maldive Gas requested Minivan News contact a company representative at its plant on the island of Thilafushi, who was not responding to calls at time of press.

Speaking to local media today, Maldive Gas Managing Director Ahmed Wafir announced that the company had since removed restrictions over the supply of LPG.

“Gas is now available as it was available from us before, without any limit,” he was quoted as telling Sun Online.

Minivan News understands that other key local suppliers such as Villa Gas have also been affected by the recent LPG shortage. Local businesses that are customers of the company said today they had been informed the issue would be resolved within the next 24 hours.

Despite the supplier’s claims, a resort general manager told Minivan News on condition of anonymity that many of the country’s exclusive island properties had been forced to drastically cut their menus due to a “comedy of errors” by suppliers.

The source claimed suppliers had been experiencing gas shortages even before reports surfaced that a transport vessel had broken down around 200 kilometres from Male’.

According to the general manager, very little information had been given by suppliers over what had led to the rationing, which was having a direct impact on a large number of tourism properties.

“All resorts have been affected from what we’re told, and what I’ve heard from other resorts. This also happened the same time last year and it seems suppliers have not learnt from this,” the resort source claimed.

The general manager said that aside from having to minimise menus, catering staff on the property had been forced to set up barbecues around the resort to try and feed guests, with certain restaurants and an on-site pizza oven out of use for most of the month.

“Needless to say, there have been complaints from guests,” the source responded, when asked about the potential damage the shortage of LPG would have on the Maldives’ reputation as a high-end tourism destination.

The general manager added that although the resort had continued to receive a limited supply of around two bottles of LPG a day during the shortage, this had been insufficient to meet the property’s average daily consumption of eight.

“Suppliers have told us normal service will resume by this evening, I’m about 90 percent certain [it will resume],” the source said.

In Male’, local media reported that a number of cafes and restaurants had also been negatively impacted by gas shortages over the last week, with some even forced to close.

“Very scary”

Local businessman Fasy Ismael, the co-owner of several well-known restaurants in the capital including The Sea House Maldives, Jade Bistro and Oxygen, described the challenge of trying to secure LPG as “very scary” for businesses such as his in recent weeks.

“We weren’t sure when we’d get LPG in, and thought we might have to shut down for a couple of days,” he said.

Fasy claimed that even today, his restaurants had only been receiving half the total amount needed to run the businesses.

“For the last week, we haven’t been able to get a full supply from Maldive Gas. Villas Gas has not been able to supply us for two weeks,” he said. “We are lucky we use two different suppliers to meet our needs.”

Fasy said today that both gas suppliers had promised that supply would be returned to normal by tomorrow at the latest.

He said his restaurants had narrowly managed to stay open, thanks to a large reserve stock of 15 bottles.

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GMR compensation claim of US$1.4 billion eclipses annual state budget

Indian infrastructure giant GMR has filed a claim for US$1.4 billion in compensation from the Maldives, following the government’s sudden termination of its concession agreement to manage and upgrade Ibrahim Nasir International Airport (INIA).

According to Indian media, the 75 page claim for “wrongful termination” of the concession agreement includes payments to subcontractors and loss of profits over the lifespan of the 25 year agreement.

Both the government and the state-owned Maldives Airports Company Limited (MACL) will be invited to respond, with a final court order in the case expected in March 2014.

In separate Singapore-based arbitration proceedings one of the project’s lenders, Axis Bank, is also seeking payment of US$160 million for a loan guaranteed by the Maldivian Finance Ministry.

Axis Bank recently raised concerns with MACL and the government, after President Mohamed Waheed moved to create a state-owned airport company and transfer to it MACL’s management responsibilities.

The prospect of MACL’s assets being dissipated led Airports Council International (ACI), the global body representing the world’s airports, to advise its members to exercise caution before making any investment in the Maldives relating to INIA, warning of “legal and financial risks”.

The government subsequently dropped the attempt, after its Attorney General Aishath Bisham warned that President Waheed had exceeded his authority in appointing board members to the new entity.

The lead up to eviction

GMR, in consortium with Malaysia Airports, narrowly won the International Finance Corporation (IFC)-managed bid for the airport in 2010, and signed the agreement with MACL under the former government of Mohamed Nasheed

The then-opposition, including the Progressive Party of the Maldives (PPM), People’s Alliance (PA), Dhivehi Qaumee Party (DQP) and Adhaalath Party (AP), opposed the agreement primarily on nationalistic grounds, and alleged corruption in the bidding process.

Other concerns raised by the opposition at the time included the prospect of GMR allowing Israeli military aircraft to stop over in the Maldives and refuel “after bombing Arab countries”.

The DQP then filed a civil court case, managing to block the developer’s charging of an Airport Development Charge (ADC) stipulated in the concession agreement, on the grounds it was a tax and therefore required parliamentary approval.

Backing the concession agreement, the Nasheed government permitted the airport developer to deduct the ADC from its share of the revenue as a stopgap measure, while it sought to appeal.

However shortly afterwards the Nasheed government was deposed during February 7 2012’s controversial transfer of power, and the opposition parties assumed control of the government – and the prospect of paying GMR for the development of the airport.

The government received US$525,355 from the airport for the first quarter of 2012, compared to the US$8.7 million it was expecting, at time it was facing a crippling budget deficit, a foreign currency shortage, plummeting investor confidence, spiraling expenditure, and a drop off in foreign aid.

In the second quarter GMR presented MACL with a bill for US$1.5 million, and in the third quarter, US$2.2 million.

“The net result of this is that the Maldivian government now has to pay GMR for running the airport,” wrote DQP Leader and newly-appointed Special Advisor to President Mohamed Waheed, Dr Hassan Saeed, in a self-described “candid” letter to Indian Prime Minister Manmohan Singh.

A subsequent report by the government’s own Auditor General (AG) found concession revenue due the government had plummeted fourfold as a result of the court verdict sought by Saeed’s own party while it was in opposition.

According to the report, net concession revenue to the government had fallen to just US$6,058,848 in 2012, compared to US$25,424,877 in 2011.

Rather than appeal the Civil Court verdict obstructing the ADC, “The new government took the view that it would not be proper for it to intervene in the legal process for the benefit of a private concern,” the report noted, and instead, on April 19 2012, the informed the developer it was “retracting the previous agreement [to offset the ADC] on the grounds that the then Chairman of MACL did not have the approval of the MACL board to make the agreement.”

GMR asserted that this decision was a political event as defined within its concession agreement, and warned that this would amount to a breach of the agreement by the government.

“The government did not accept this argument,” noted the AG.

Seeking a way out of the agreement but wary of the heavy penalties in the termination clause, the government accused the World Bank’s IFC of “irresponsibility” and “negligence” in its conduct of the bidding process.

“The government must also consider how much money has to be paid back as compensation if terminating the agreement,” said Attorney General at the time, Azima Shukoor, during a prescient press conference in September 2012.

“It is clear to all of you that the Maldives financial and economic situation is at a critical level, and in this situation [termination] is not an easy thing to do,” Shukoor said.

In August 2012, with the new terminal and refurbishment 25 percent complete according to the government’s outside engineering assessment, the government ordered a halt to construction pending new ‘regulatory approvals’, and demanded a second runway not included in the original agreement.

GMR agreed to construct an emergency runway and proposed exempting Maldivian nationals from paying the ADC as a compromise. The company received no response to the offer.

Dr Hassan Saeed meanwhile issued a pamphlet calling for the cancellation of the agreement, likening it to “taking bitter medicine to cure a disease” or “amputating an organ to stop the spread of cancer.”

In his letter to Indian Prime Minister Manmohan Singh, dated September 19 2012 and obtained by Minivan News, Saeed further claimed that “GMR and India ‘bashing’ is becoming popular politics”, and warned that “as a result, “the Maldives is becoming fertile ground for nationalistic and extremist politicians.”

“I want to warn you now that there is a real danger that the current situation could create the opportunity for these extremist politicians to be elected to prominent positions, including the Presidency and Parliament on an anti-GMR and anti-India platform,” Saeed informed Singh.

Saeed went on to accuse GMR of extensive bribery, including the payment of “millions of dollars to buy MPs to get a parliamentary majority for the then ruling Maldivian Democratic Party”.

He claimed that “politicians and MPs who end up in GMR’s pocket keep silent but no one – with the exception of former President Nasheed and his key associates – have defended the indefensible GMR deal in public.”

Eviction

In late 2012 the government declared the concession agreement ‘void ab initio’ (invalid from the outset), and gave GMR seven days’ notice to leave the country.

The move swiftly followed the Singapore Supreme Court’s lifting of an injunction blocking MACL from taking over the airport pending arbitration proceedings, on the grounds the arbitration court had no jurisdiction to prevent the Maldives as a sovereign state from expropriating the airport.

The full verdict however did not exempt the government from compensation for this maneuver. In fact, according to the verdict document, Financial Controller for the Ministry of Finance Mohamed Ahmed “affirmed in an affidavit that the Maldives government would honour any valid and legitimate claim against it. He also stressed that the Maldives government had never defaulted on any of its payments.”

Moreover, lawyer representing MACL, Christopher Anand Daniel, “also accepted that if the arbitration tribunal found that the Appellants were wrong in their asserted case that the Concession Agreement was void ab initio and/or had been frustrated, but the Appellants had by then already gone ahead with the taking over of the airport, they would at least be liable to compensate the respondent for having expropriated the airport” (emphasis retained).

ACC exonerates airport deal

The Auditor General’s report acknowledged allegations of corruption in the deal, but finding the evidence “not conclusive on this point”, deferred to the judgement of the Anti-Corruption Commission (ACC).

That arrived on June 17, 2013, in the form of a 61 page investigative report that concluded that the bidding process was conducted fairly by the IFC, and that the GMR-MAHB consortium won the contract by proposing the highest net present value of the concession fee.

The ACC further concluded that the awarding of the contract did not contravene amendments brought to the Public Finance Act requiring parliamentary approval for such agreements.

Furthermore, “Considering the situation (2008, 2009 and 2010) when the decision was made to privatise the Male’ International Airport,” the ACC’s calculations showed that MACL would make a profit of about US$254 million in 25 years if the airport was operated by the government-owned company.

Conversely, the government would receive about US$534 million in the same period from the GMR consortium if the airport was privatised, the ACC found.

Reactions

Following publication of the ACC’s report, the government has backed away from allegations of corruption and instead declared to evict the developer was made due to its impact on state finances.

“Back before the government took back control of the airport from GMR, the reason we gave was that the deal was bleeding the country’s economy. We were paying GMR to keep them here,” President’s Office Spokesperson Masood Imad told Minivan News last week.

Azima Shukoor meanwhile labelled ACC’s report “incomplete” and “lacking professionalism”, in an interview with local media.

“There’s no contradiction between the government’s decision and the ACC report. We never levelled any corruption charge in terminating the agreement,” said the former Attorney General, in an interview with local media.

“Did [the ACC] omit the factors deliberately or unknowingly or simply just overlooked them? But a lot of factors have been overlooked and omitted from the report. The state will suffer great losses because of it. Especially when the country is tied up in [arbitration proceedings],” Shukoor was reported as saying.

“The state did a thorough investigation of the contract, including what happened during and after the signing of the agreement. So the government’s legal position doesn’t and shouldn’t change due to the report. We made a very firm decision,” she said.

Speaking at a campaign rally on the island of Thimarafushi in Thaa Atoll, former President Nasheed observed that the figure sought by GMR as compensation amounted to more than the annual state budget of the Maldives.

“Even today in my view it is one of the most important duties of the People’s Majlis to renew the contract, find a way to hold discussions with the company over [renewal], and save the Maldives from the great misfortune our people are about to face,” he said.

Former President Maumoon Abdul Gayoom’s PPM have meanwhile laid the blame for the airport debacle on President Waheed, accusing him of “ignoring advice”.

“We told the next President Mr Waheed that he should hold discussions with the GMR Group and the Indian government to arrive at an acceptable solution, after which the government was free to act on its own,” he said. “Unfortunately, this was not done and suddenly there was this unhappy ending,” Gayoom was reported as saying in the Hindu, following a visit to India and a meeting with Prime Minister Singh.

Following the PPM’s apparent turnaround on the GMR issue, Parliamentary Group Leader of the Waheed-aligned Dhivehi Rayithunge Party, Dr Abdulla Mausoom, said it was in fact senior figures in the PPM who were among the most vocal supporters for terminating the GMR agreement.

“It is ironic that we are hearing these statements from the PPM, whose leader has been witnessed supporting rallies demanding the cancellation of the [GMR] agreement,” he said.

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Adhaalath Party head accused of attempting to influence ACC investigation into GMR

Adhaalath Party President Sheikh Imran Abdulla attempted to influence the Anti Corruption Commission (ACC)’s investigation into alleged corruption in the previous government’s aborted airport privatisation deal, a commission member alleged to local media outlet CNM.

The ACC member, on condition of anonymity, reportedly alleged that the commission during its investigation came under heavy criticism from Sheikh Imran over its refusal to tailor the report to his liking.

The ACC’s findings, which were published last week, concluded that there was no corruption in the airport privatisation deal, days prior to GMR claiming US$1.4 billion in compensation for “wrongful termination” of its 25 year concession agreement.

“He met with me on two occasions. The first meeting happened just a day before they were to have a big night of protests. He requested that the ACC help the national movement’s efforts to drive GMR away and to speed up our investigation and conclude it in such a fashion that would assist their efforts,” CNM quoted the commission member as saying.

The second meeting took place a day before the national movement’s protests concluded, he claimed.

According to the unnamed commission member, Imran requested a five-minute meeting.

“On the second night he told me that he hoped the ACC would include at least one phrase that would be helpful to the national movement,” he said.

ACC President Hassan Luthfee had his phone switched off when contacted regarding the allegations today.

Sheikh Imran and national movement steering committee member and spokesperson Abbas Adil Riza were not responding to calls from Minivan News at time of press.

Last Monday, the ACC ruled out corruption in the awarding of a concession agreement in June 2010 to a consortium of Indian infrastructure giant GMR and Malaysia Airports Holdings Berhard (MAHB) to develop and manage INIA.

In a 61-page investigative report (Dhivehi), the ACC concluded that the bidding process was conducted fairly by the World Bank’s International Finance Corporation (IFC) and that the GMR-MAHB consortium won the contract by proposing the highest net present value of the concession fee.

The ACC further concluded that the awarding of the contract did not contravene amendments brought to the Public Finance Act requiring parliamentary approval for such agreements.

The amendments were published in the government gazette after the concession agreement was signed, the ACC noted.

In December 2012, shortly after the protests led by Sheikh Imran Abdulla under the self-titled ‘national movement’ against GMR concluded, the government of President Mohamed Waheed Hassan abruptly terminated the agreement and gave GMR a seven day ultimatum to leave the country.

“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,” then-Attorney General (AG) Azima Shukoor said in a press conference announcing the decision.

Shukoor claimed that the government reached the decision after considering “technical, financial and economic” issues surrounding the agreement.

Criticism

Responding to the ACC report in local media, Sheikh Imran Abdulla described the findings as a “slap in the peoples’ face.”

He claimed that the public now resented the ACC due to its findings and that the commission had lost credibility as a result of the report.

Imran contended that the report would facilitate the return of GMR should the opposition Maldivian Democratic Party (MDP) win the September presidential election.

Responding to the ACC’s findings, the government of President Waheed insisted that the report would have no impact on its legal position to declare the GMR concession agreement void, contending that President Waheed’s decision had nothing to do with corruption allegations levelled by “some people”.

President’s Office Media Secretary Masood Imad told Minivan News following the release of the report that the contract was declared void from the beginning due to the negative impact on state finances in 2012.

Masood said that despite “speculation from some people” concerning corruption by the former administration in signing the deal, the present government was not responsible for filing a case with the ACC.

He added that the government’s concerns over the deal had been in relation to the imposition of a US$25 Airport Development Charge (ADC) by GMR that was blocked by the Civil Court in 2011 after the then-opposition DQP filed a case on the matter.

The DQP, now part of President Waheed’s coalition government, attempted to block payment of the charge on the grounds that it was effectively a tax not approved by parliament.

In response, then MDP government agreed to deduct the ADC from the concession fees payable, while GMR later offered to exempt Maldives nationals from paying the ADC as it moved to appeal the verdict.

However, former President Mohamed Nasheed resigned under controversial circumstances on February 7, 2012 amidst a violent mutiny by elements of the police and military before the Civil Court verdict was appealed at the High Court.

Consequently, in the first quarter of 2012, Dr Waheed’s government received US$525,355 of an expected US$8.7 million, after the deduction of the ADC. That was followed by a US$1.5 million bill for the second quarter, after the ADC payable eclipsed the revenue due the government.

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