Bids of up to Rf1 billion for airport, while Jumhoory Party announces ”special gathering” to express disapproval

Indian company GMR Infrastructure has said it is confident it will win the bid for Male’ International Airport, after offering US$78 million (Rf1 billion) upfront.

“Considering the offers, we will get the highest marks. We will make the payments and take over the operations of the airport in March,” newspaper Haveeru reported one official as saying.

Finance Minister Ali Hashim disclosed the bids at a function today.

Bids at a glance:

  • GMR-KLIA: US$78 million upfront and one percent of the total profit in the first year (until 2014), and 10 percent of the profit from 2015 to 2035. GMR would also pay 15 percent of fuel trade revenues to the government in the first four years and 27 percent from 2015 to 2035.
  • Turkish TAV Airports Holdings Company and French Airports De Paris: US$7 million (RF89.95 million) upfront payment, with 31 percent of the total profit until 2014 and 29.5 percent from 2015 to 2035. The consortium offered 16.5 percent of the profits from fuel trade.
  • Swiss Flughafen Zurich AG and GVK Airport Developers offered US$27 million (Rf346.95 million), along with 27 percent of the total profit in the first four years and nine percent of the profit from 2015 to 2035. The consortium said it would pay nine percent of fuel revenues to the government.

The Jumhoory Party (JP), led by Gasim ‘Buruma’ Ibrahim, has meanwhile announced that it will conduct a ”special gathering” to express disapproval at the government’s decision to privatise Male’ international airport.

Ali Shareef, secretary general of JP, said the special gathering would be conducted in collaboration with other NGOs and political parties.

”Male’ international airport was built by our forefathers and it is one of the assets of the state,” said Shareef. ”There are many concerns over privatising the airport, and we want to express our opinions during this special gathering.”

Shareef said the transaction could cause disruption and “national security issues”, and would decrease government revenue.

‘There is no transparency in this transaction,” he said. ”We are very concerned over the issue.”

He said that the gathering would be “a peaceful gathering.”

”We want to gather people and make them aware of what’s happening, and tell them the consequences of it,” he said. ”There is the potential for many problems if foreigners control the country’s main entrance.”

He said that the venue, date and time of the gathering was yet to be advised.

”We are in discussion with other parties involved and will decide the venue and date very soon,” he said.

Moosa Rameez, Spokesperson of JP, said members of the party and people of the country were concerned over the issue.

”Male’ international airport is a asset of the state which was built by the people,” said Moosa. ”We do not want it to be given to a foreign party.”

The Dhivehi Rayyithunge Party (DRP) has also expressed concerned over the issue.

Vice President and Spokesman for the opposition Dhivehi Rayyithunge Party (DRP) Ibrahim Shareef said the party will not honour “shady deals made according to vested interests” if the party comes to power in 2013, referring to the government’s privatising of the country’s airports.

Shareef also expressed concern that the government’s efforts to privatise state assets, such as the airport, were not occurring with parliament approval.

Shareef said the airport was currently “making the government money”, and the asking price it had set “is so low. [The deal] is riddled with corruption,” he alleged. “If the government has nothing to hide, it has nothing to lose from asking parliament.”

Minister for Civil Aviation and Chairman of the Privatisation Committee Mahmoud Razee recently told Minivan News that ”as far as I understand we are proceeding according to the public finance act which is currently in force. Parliament legislates but actual delivery is up to the executive.”

It is the opposition’s “prerogative to say what they wish, but the reason why experienced and reliable companies are involved in this bid is because they believe that this is a viable project.”

The Male’ airport privatisation deal would be for 25 years, extendable by another 10 years, and would require a minimum level of investment towards upgrading the airport in the first three years to meet a certain level of service.

This week government shortlisted three parties to run Male’ International airport and has it would select one by the end of the week.

The parties include Aéroports de Paris Management Company of France (ADP) and Turkish company TAV Airports Holding Company, Indian company GVK Airport Developers in partnership with Swiss Flughafen Zurich AG, and GMR-KLIA.

Press secretary for the president, Mohamed Zuhair did not respond to Minivan News at time of press.