Tag: minivan news

Government to consult tourism industry on potential T-GST increase

The government will hold a consultation with the tourism industry this week to test its appetite for an increase in the Tourism-GST (TGST), Tourism Minister Ahmed Adheeb has said.

The International Monetary Fund (IMF) has urged the Maldives to increase the T-GST from six percent to 12 percent, among several measures the organisation says are urgently needed to offset the Maldives’ spiraling budget deficit, and avoid miring the country in poverty.

Parliament’s Finance Committee last week calculated that the budget deficit would reach 27 percent of GDP, on the back of plunging revenues and a 24 percent increase in government expenditure.

Adheeb told Minivan News that the government would present the IMF’s report to the industry, and discuss how to proceed: “We have to be realistic,” he said.

“The IMF has recommended an increase to 12 percent – we need to discuss what kind of increase the industry would like to see over the next five years,” he said.

Adheeb emphasised the need for stability rather than sporadic increases in the tax, cautioning against a sudden change in the T-GST which would affect those tour operators who make pricing agreements and publish brochures up to a year in advance.

However, Secretary General of the Maldives Association of Tourism Industry (MATI), Mohamed Ibrahim ‘Sim’, warned that the tourism industry was already under pressure from a decline in traditional markets.

“Is there an appetite [to increase the TGST]? No, not really. The European economy is not doing well and we would like the costs to remain the same – GST is something we have to pass to the customer. We need to maintain it, at least for the moment,” Ibrahim said.

One resort manager told Minivan News on condition of anonymity that such an increase would have “serious ramifications on many of the markets.”

“Some operators will not accept the increase mid-contract and hence resorts will have to absorb this from revenue,” he explained. “The additional costs will need to be balanced somewhere in the operation and you will find resorts have to [reduce] some of the nice touches for guests, [cut] staffing levels etcetera in order to deal with these ever growing expenses.”

The manager expressed exasperation that resorts were being asked to shoulder the burden without a parallel commitment from the government to reduce expenditure.

“We have seen an increase in some public services salaries and a reduction on working hours in many government departments who are meant to serve the resorts. Many of these government departments make it difficult for the resorts to do their jobs, with bureaucracy and rules to keep extra people in a job rather than making it easier to support the resorts in order to do their job: build more business, increase revenue and hence increase GST [revenue] in a positive manner. An increase in GST right now is the wrong solution.”

The government “needs to take a more supportive approach to the resorts”, he suggested, “whether it be processing visas, expediting customs waits or speeding up the immigration process for guest at the airport. A serious revision of the various government departments is required.”

According to figures from the Maldives Inland Revenue Authority (MIRA), the T-GST brought in 32.4 percent of all government revenue in April.

Total revenue collected in April was Rf2.5 billion (US$162.1 million) – almost double that collected in April last year – however MIRA’s figures do not take into account the substantial revenues lost from the phasing out of import duties, previously the Maldives’ main source of tax revenue.

Former government to blame?

Adheeb blamed the need for the increase on the former government’s changes to the calculation of land lease rents, which he claimed were responsible for an Rf540 million (US$35 million) shortfall overall after the new taxes were introduced.

MATI’s Ibrahim however contended that the changes to the fixed rents were offset by the new taxes: “Our calculation at the time these taxes were introduced were that overall it balances out, but that some resorts pay more.”

Recent changes introduced by the new government to the payment of lease extensions – from a lump sum to an annual basis – have also pulled US$135 million in revenue from the 2012 budget, the ousted Maldivian Democratic Party (MDP) contends.

Economic indicators published by the Maldives Monetary Authority (MMA) meanwhile show a fall in the number of tourist arrivals for March 2012 compared to the previous year, from 80,732 to 76,469. The number of bed nights fell 6.8 percent for the same period, one of only a few recorded declines since the 2004 tsunami. February – a month of high political turmoil and widespread negative international media coverage – recorded a 2.5 percent decline.

An increase in prices would affect established markets already under strain, Ibrahim reiterated.

“It’s hard to say if emerging markets would be put off – China, Russia and the Middle East – maybe not. But [price increases] are affecting the established market. The market situation is not looking good at the moment.”

A survey of nearly 3000 tourists last year reported that 46 percent believed accommodation in the Maldives was too expensive. Soft drinks, alcohol were rated as expensive by 42 percent, while food, water and souvenirs received a similar rating from 41 percent of tourists polled.

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Police investigate security guard suspected of filming girl inside IGMH toilet

The police are investigating a security guard of the state owned Indhira Gandhi Memorial Hospital (IGMH) for allegedly taking indecent images of a 16 year-old girl inside the hospital’s toilet.

The incident was reported to the police on May 3, according to local news Sun.

The police media official said that no arrests have been made yet, but the investigation is ongoing.

The girl was reportedly visiting her father admitted at the hospital.

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Mulay failed to pass information on coup to Indian government: Open Magazine

Senior figures of former President Mohamed Nasheed’s government have accused Indian High Commissioner Dnyaneshwar M Mulay of failing to pass critical information to the Indian government on February 7, as mutinying police and army officers joined opposition demonstrators to overthrow Nasheed’s presidency.

The allegations were published in India’s weekly current affairs and features magazine, Open, following Nasheed’s recent visit to India.

Former National Security Advisor Ameen Faisal told the magazine that he was “surprised” that Mulay was in the company of former President Maumoon Abdul Gayoom’s half-brother, Abdulla Yameen, during the upheaval, and made no attempt to contact the elected government.

“I believe that proper information was not passed on to Indian authorities,” Faisal alleged, to Open.

“I was surprised that instead of contacting us, the government [of the Maldives], Mulay was having a discussion with opposition party leaders like Yameen in the Indian High Commission, when the coup was happening. In a situation like this, why call the opposition and not establish contact with the government? Before this happened, I never suspected [any conspiracy]. We were very close,” he said.

“I maintained a close relationship with Mulay. I called him three or four times while the coup was underway. I could not contact President Nasheed. At that point, he was inside the army headquarters and his phone was jammed. I spoke to Foreign Minister Ahmed Naseem, instead, for his advice on seeking Indian intervention to control the situation. He told me that President Nasheed did not want any military intervention as it was an ‘internal matter’,” Faisal recalled.

“Later, Naseem called me to request some assistance from India. As the national security advisor, I called up Mulay and sought Indian assistance… He asked me to ask the foreign minister to send a note. I told Mulay that this was no time to be sending notes or love letters.”

Mulay, Faisal contended, “could see what was happening from his window. The whole coup was being telecast live. As a diplomat, he should’ve known that the whole country was in chaos.”

Faisal further claimed that Mulay had earlier informed him that the Indian Navy vessel INS Suvarna was in Maldivian waters three days before the events of February 7, and departed that morning. Open independently confirmed the presence of the vessel in Maldivian waters on that date.

“If the Indian Naval ship was just an hour away, it was in our territorial waters, why was the [Maldives] government not informed of it? What was the Indian naval ship doing there?” Faisal alleged.

Open observed that former President Nasheed appeared careful not to go on record with any allegations himself – and instead deferred to Maldivian Democratic Party (MDP) interim Chairperson ‘Reeko’ Moosa Manik, “to speak on my behalf”.

“[Mulay] became so powerful that he started behaving like the prime minister and not a high commissioner. In early 2011, we felt that Mulay was drifting away from the MDP. He wanted to meet leaders of opposition parties. He wanted to be invited to all official functions that took place in Maldives. He was invited to many government functions, but not all. We found that a lot of companies were coming [to the country] for business through Mulay. We were floating tenders for big projects. He would act like a middleman,” Manik alleged to Open.

“Mulay would visit various [Maldivian] islands with his Indian friends, many of them businessmen. The government did not know who they were. Mulay has good connections with opposition parties, particularly Gayoom’s party,” he further claimed.

Manik also alleged that Yameen was present in Mulay’s office on the morning of February 7, while outside, a group of opposition supporters had joined police in an all-out assault on the country’s main military base in Republic Square. A second group broke down the gates of the state broadcaster, and took over the station. President Nasheed subsequently resigned, later alleging this was under duress.

“How many times did Mulay try to talk to somebody in the Government of India when all this was going on? How many times did Mulay call the Indian Government to ask them to intervene? There are 30,000 Indians living here and Indian business interests are at stake. He should have informed the Indian authorities. There is something fishy about Mulay’s response,” Manik told Open.

Open sought response from India’s Ministry of External Affairs, which did not address the allegations, but instead expressed “full confidence” in Mulay.

“The alleged references to the High Commissioner’s conduct in some media interactions by former President Nasheed were raised during his discussions with Indian officials,” noted MEA Spokesperson Syed Akbaruddin.

“Former President [Nasheed] had clarified that he had not said the things attributed to him in the media. He said that he had known the High Commissioner for three years. The High Commissioner was a poet and he liked him. There were never any issues with the High Commissioner and he would clarify this to the media appropriately,” Akbaruddin claimed.

“We do not think it is appropriate to bring our High Commissioner into the discourse. He enjoys our full confidence.”

Speaking to Minivan News, Mulay declined to comment on the specific allegations, “as my government has already responded”, but described them as “completely baseless, a flight of fancy.”

Yameen confirmed to Minivan News that he had met with Mulay on the morning of February 7.

“It was Mulay who SMSed me and asked me to come and discuss the national crisis,” he said. “Mulay asked me to get a checklist of demands [from the protesters] and try to see if there could be a three-day respite.”

Asked why he believed Mulay had contacted him, Yameen said he believed it was “because PPM was the largest opposition party [at the time].”

Additional allegations made by Manik and published in Open, that Yameen had “ transferred several thousand US dollars from Colombo to some army and police officials by way of travellers’ cheques”. However Yameen dismissed the allegations as “absolute gibberish.”

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Comment: Weathering the storm – the Commonwealth and Maldives

The Commonwealth Ministerial Action Group (CMAG) is in the eye of a storm in Maldives. In its last meeting on 16 April it warned that it will consider “stronger measures” if the terms and reference and composition of the Maldivian National Commission of Inquiry is not “amended within four weeks in a manner that is generally acceptable and enhances its credibility”.

“Stronger measures” is probably a hint at suspension from the Commonwealth. Over two weeks have passed since that decision, now in Maldives there is talk about withdrawing the country’s membership from the Commonwealth.

How did all this come about? In the past few months, events in the Maldives have caught headlines and raised eyebrows across the world. These months saw the country’s democratic transition plagued by serious uncertainty. The most sensational part of this turn of events is mystery around the exit of former President Mohamed Nasheed.

The National Commission of Inquiry (NCI) was set up by the government to look into what transpired on the fateful day of 7 February 2012 when Vice President Mohamed Waheed Hussain took over following Mr Nasheed’s resignation – which the latter subsequently claimed was forced at gun point. The immediate backdrop for this is the military’s arrest the Chief Judge of the Criminal Court on 16 January 2012 under Mr Nasheed’s orders – a move that attracted international condemnation and regular protests in Maldives.

Mr Nasheed claimed that the judge who was under investigation by the Judicial Services Commission (JSC) represents a judiciary that is dysfunctional – while protests continued to rage and reports of a possible police mutiny began to emerge as 7 February unfolded.

Storm clouds have gathered over Maldives for long and the recent series of events are a culmination of what has been brewing for a while. Following a drawn out pro-democracy struggle in the Maldives led by Nasheed’s Maldivian Democratic Party (MDP), the 2008 Presidential elections saw Mr Nasheed contested against the incumbent Mr Maumoon Abdul Gayoom and winning – albeit by a margin of about eight percent.

The end of the 30 year regime of former President Gayoom was widely perceived as the beginning of full-fledged democracy in the Maldives. Since then, what began as a smooth ride eventually began to get bumpy. Rising prices, drug and crime issues, economic disparity, corruption allegations and concerns over the transparency of increasing foreign investments all began to cause unrest. Towards the end there were frequent public demonstrations and political standoffs.

While stalemates between the opposition dominated Parliament and the executive has been an issue, divisions also emerged between the executive and the judiciary – most of the appointments in the latter had been made during Gayoom’s tenure and the executive viewed this wing of state as being unreformed and loyal to the former regime.

The international community including the Commonwealth eased out of their heightened scrutiny of Maldives following the 2008 Presidential elections. In the aftermath the country’s nascent democracy has faced severe tribulations. Maldives is precariously located in the tip of South Asia, in the middle of strategic sea lanes making it important economically and politically both for the West and the two Asian giants – China and India. The crisis in the Maldives is an important bellwether of the edgy geopolitical climate in this region which has already found reflection in other countries of the region such as Sri Lanka.

While a lot of the current focus is mired over opposing political views within Maldives, it is important to remember that the vagaries of politics inside and outside the country should not ultimately lead to the Maldivian people viewing the values of human rights and democracy with blighted hope. It is important that these values are upheld and the protections that they afford are ensured.

An important step in doing this is to make sure that truth is both told and is seen to be told, freely sans politicisation. In this context, it is important that the National Commission of Inquiry is credible and is able to investigate and report freely and publicly. This call for credibility and impartiality has also been aptly echoed and elaborated by several Maldivian NGOs coming together in a new civil society coalition called ‘Thinvana Adu’ or ‘Third Voice’. Independent institutions in the Maldives such as the Human Rights Commission of Maldives (HRCM) and the Police Integrity Commission (PIC) should follow this lead and conduct their own parallel investigations and report publicly at the earliest.

Even though the Commonwealth should have made more early and transparent efforts to scrutinise the progress of democracy in the Maldives, it is a good sign that after years of being dormant CMAG has now taken the directions given to it in the 2011 Commonwealth Heads of Government Meeting seriously. It is also important that CMAG has recognised the need for a credible National Commission of Inquiry. If Maldives decides to leave the Commonwealth it will be the only other country after Zimbabwe to do so – a parallel that may be politically damaging for Maldives to equate itself with at this time of crisis.

R Iniyan Ilango is a Coordinator for the Strategic Initiatives Programme of the Commonwealth Human Rights Initiative.

All comment pieces are the sole view of the author and do not reflect the editorial policy of Minivan News. If you would like to write an opinion piece, please send proposals to [email protected]

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High Court denies ACC injunction as commission appeals Civil Court ruling on Nexbis

The Anti Corruption Commission (ACC) has appealed a ruling from the Civil Court blocking its order to halt the implementation of a border control system agreement between the Immigration department and Malaysian firm Nexbis.

The commission also called for an injunction on the installation of the system until the High Court case was resolved, however Judge Azmirelda Zahir said such a decision could only be taken after both sides had presented their cases. The ACC requested an injunction on the grounds that it would lose the possibility of appeal should the project be implemented before the conclusion of the High Court case.

The ACC in December forwarded corruption cases against former – and now reappointed – Immigration Controller Ilyas Hussain Ibrahim and Director General of the Finance Ministry, Saamee Ageel, to the Prosecutor General’s Office (PG), alleging that the pair had abused their authority for undue financial gain in giving the US$39 million to Nexbis.

The ACC had earlier ordered a halt to the project following the signing of the contract in October 2010, announcing that it had received “a serious complaint” regarding “technical details” of the bid, and that the agreement presented “instances and opportunities” for corruption.

The 20-year Build, Operate and Transfer (BOT) agreement with the Malaysian-based mobile security solutions provider was to upgrade border security in the Maldives with new technology including facial recognition and fingerprint identification, facilitating the identification and tracking of expatriate workers and eliminating the opportunity to people to enter the country with forged paper documents.

The agreement allows Nexbis to levy a fee of Rf30 (US$2) from arriving and departing passengers in exchange for installing, maintaining and upgrading its immigration system. The company would also charge a Rf231 (US$15) for every work permit card.

Immigration Controller under the later months of President Mohamed Nasheed’s administration, Abdulla Shahid, contended that the agreement meant that Nexbis would draw US$200 million in revenue from the project over the life of the 20 year contract, while five percent royalties to the government would equate to US$10 million.

Speaking to Minivan News following the ACC’s initial injunction, Shahid claimed that the deal would deprive the government of significant revenues, when “border control is not something we are unable to comprehend – it is a normal thing all over the world.”

Shahid estimated that a free system given by a donor country would cost at most several hundred thousand dollars a year, and said he was unsure as to why such an agreement had ever been signed.

However, Nexbis said in a subsequent statement that its agreement meant that neither the government nor the Maldivian public would pay upfront for “state-of-the-art border security protection”, and suggested that “reasonable persons will likely realise that once the hidden costs after are taken into account and adjusted for inflation, the benefits and efficiencies of the Nexbis system will far outweigh the risk, inadequacies and uncertainties of any such alleged cheaper system.”

The Civil Court in January 2012 ruled that the Anti-Corruption Commission (ACC) did not have the legal authority to order Immigration Department to terminate the agreement, with Judge Ali Rasheed ruling that while the ACC Act gave the commission the authority to investigate corruption cases, it was not able to annul contracts.

Judge Rasheed asserted that it was “unfair” to the contractors if ACC could annul an agreement without their input, as this violated their protections under Maldives Contract Law.

During the High Court hearing this week, the ACC charged that the State Attorney during the Civil Court case, Deputy Solicitor General Ahmed Usham, had a conflict of interest as he had been a member of the tender board responsible for awarding the project to Nexbis. Usham disputed the charge.

The case continues.

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Dhiraagu restores internet services, announces service credits

Dhiraagu has repaired damage to its underwater cable that slowed internet in the Maldives to a crawl and affected some overseas phone calls, and announced the restoration of full service.

The cable suffered damage at a depth of 40 metres, 26 kilometres from the Sri Lankan coast, on April 18.

The company announced service credit to affected customers, including the waiving of rental for ADSL customers for the affected period.

TouchNet Postpaid customers will receive a free 20 percent data allowance until May 31, while TouchNet Prepaid customers will receive an additional allowance of 200mb until May 15.

Mobile internet users will receive an extra 20 percent allowance on any data packages until May 31.

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Comment: Open letter to Ruder Finn

The following open letter was sent by Maldivian Democratic Party (MDP) MP Eva Abdulla, also a member of the IPU’s Coordinating Committee of Women Parliamentarians, to Emmanuel Tchividjian, Senior Vice President and Ethics Officer at US public relations firm Ruder Finn. The company recently won a three-month contract to represent the Maldivian government.

Dear Mr Tchividjian,

On 7th February 2012, elements of the police and army loyal to the former autocratic leader of the Maldives, Mr. Maumoon Abdul Gayoom, threatened the democratically-elected President of the country, H.E. Mr. Mohamed Nasheed, his family and his supporters with physical harm unless he resigned by a certain time that day. Those elements of the police and army then escorted President Nasheed to the President’s Office and stood over him as he wrote a ‘resignation’ letter, while others forcibly took control of the country’s main television station. A new Government has since been constituted, dominated by allies of former President Gayoom – even though the country clearly rejected him and his thirty-year dictatorship through the ballot box in the 2008 presidential election.

As a member of the governing council and the Women’s Wing of the Maldivian Democratic Party, and an elected representative, I am therefore writing to express our surprise and disappointment that Ruder Finn decided to tender for and sign a contract with this clearly undemocratic and illegitimate government, a contract under which you will be asked to act as public apologist and public advocate.

We note that you claim to be Ruder Finn’s ‘Ethics’ Officer and that you once argued in an interview that “ethics is essentially an issue of values”. We put it to you however that both you and Ruder Finn, by accepting this contract, have demonstrated a complete lack of both values and ethics.

You justify your decision on ‘ethical’ grounds by saying that you have studied the “complex political situation” and have concluded that the current government is legitimate according to the country’s constitution but that if the National Commission of Inquiry determines that the government came to power illegally you will resign the contract. This position is so riddled with contradictions that it is difficult not to conclude that your ‘ethical’ analysis is nothing more than a fig leaf disguising a policy of ‘profit-at-any-cost’.

How can Ruder Finn have determined that the government is constitutional and legitimate when the national mechanism established to answer that very question, the NCI, has not yet presented its findings? Do you have the power of foresight?

Having already prejudged the conclusions of the NCI, you then claim Ruder Finn will resign the contract if the NCI demonstrates foul play. And yet if you had indeed “closely examined” the complex situation you would know that the Commonwealth Ministerial Action Group (CMAG), the Maldives’ largest political party – the MDP, and the country’s civil society have all stated that the NCI, chaired by President Gayoom’s former Minister of Defence, is neither independent nor credible.

Also in interview, you have argued that “the starting point of using one’s values to make an ethical choice is, one would presume, to have a clear and accurate understanding of the facts”. If this is the case, one wonders which facts you are basing your ethical choices on. You are the only organisation outside the Maldives, which has already decided that the current government is legitimate. Both the Commonwealth and the European Union, the two organisations most closely following events in the Maldives have both said the opposite – that there are clear questions marks over the legitimacy of this government and it can only demonstrate its legitimacy through an independent and impartial national commission of inquiry, and through early elections. Does Ruder Finn have a political analysis capability greater than that of the Commonwealth and the EU?

Which brings me to perhaps the most damning indictment of your company and your claim to conduct “ethical public relations” – that in your public statements on this issue you have knowingly issued untruths and sought to mislead. You claim in your interview with the Holmes Report on 27th April that “accusations of a coup have been dismissed from many international organizations and governments, including the United Kingdom government who has said that they do not recognize the transfer of power in the Maldives to be a coup”. Yet this is a clear misrepresentation of the position of the UK and the European Union, both of which have consistently made clear that there are serious questions about the legitimacy of this government and thus (taken from a Declaration by Baroness Catherine Ashton on behalf of the European Union on 22nd February 2012 ): “The EU is of the view that the legitimacy and legality of the transfer of presidential power in the Maldives should be determined by an impartial, independent investigation as agreed by all parties in the Maldives”. Both the EU and the Commonwealth – which is working in close cooperation with the United Nations on this issue – have also clearly said that in the medium-term legitimacy can only be conferred through a popular vote expressed through early elections in 2012.

Thus one can only conclude that, if ethical public relations is indeed a case of having a clear and accurate understanding of the facts, and then applying one’s values, it would seem that Ruder Finn practices a deeply unethical form of public relations because you lack a clear grasp of the facts, and, it would seem, have no values beyond a wish to make money.

On this point, it has been reported that your contract with the current government is worth almost $150,000 a month ($1,800,000 or Maldivian Rufiyaa 28 million annually). To provide you with some “clear and accurate facts.” If in the Maldives:

  • N. Milandhoo sewerage project = 29.9 million MRF
  • N. Magoodhoo harbour project = 18.8 million MRF
  • One government built housing unit in Ga. Kolamaafushi = 1 million MRF
  • Aasandha health insurance premium per person = 2650 MRF

The Ruder Finn contract, per annum, with the current Maldivian regime is then equivalent to:

  • A sewerage project
  • A harbour project
  • 28 government built housing units,
  • Aasandha health insurance premium for 10,473 citizens (the same health insurance scheme the current regime has announced scaling back, claiming lack of funds).

I invite you to apply your ‘values’ to these facts and to reach an ‘ethical’ conclusion.

Finally, I would like to remind you that while you are fortunate, in countries such as the United States and the United Kingdom to enjoy stable democracies which allow for the full enjoyment of human rights, with those rights come certain duties and responsibilities. Among those duties, I would hope, is to use your freedoms to promote the rights of other people in other countries and not knowingly work towards the suppression of those rights. President Gayoom presided over extrajudicial killings in our jails, and over hundreds of documented cases of torture. Since the overthrow of President Nasheed, cases of Police brutality have again begun to resurface – including against Members of Parliament (cases have been lodged with the Inter-Parliamentary Union), as have cases of State-sponsored sexual and gender-based violence against women, arbitrary detention and police brutality. Ruder Finn has now unwittingly made itself a vehicle through which he and his associates are defying the democratic right of people in the Maldives to choose their government and are instead reasserting the old autocracy.

If you continue down this path, then you will be party to one of the greatest injustices ever inflicted on the people of the Maldives. It is difficult to understand how Ruder Finn or you personally would be able to call such a choice “ethical”. We also wonder whether your corporate clients, such as Israeli Airline El Al (which Members of Parliament of the current regime voted to ban from landing in the Maldives) Reuters, Acca, Lexus, Eli Lilly, Pfizer, Ricoh, Michelin, Four Seasons, Johnson & Johnson, Manpower, would be able to understand.

Yours sincerely,

Eva Abdulla

All comment pieces are the sole view of the author and do not reflect the editorial policy of Minivan News. If you would like to write an opinion piece, please send proposals to [email protected]

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GMR deducts US$8.1 million from concession fees for 2012 first quarter

Indian infrastructure giant GMR, appointed by former President Mohamed Nasheed’s administration to manage and develop of the Ibrahim Nasir International Airport (INIA), has deducted US$8.1 million from concession fees paid to the government for the first quarter of 2012.

GMR took over the management of INIA from the government-owned company Maldives Airports Company Limited (MACL) in September 2010. According to a statement from the MACL, the company only received US$525,355 out of an expected US$8.7 million in concession fees for the first quarter of 2012, after GMR deducted payment for airport development fees and insurance surcharge.

The Airport Development Charge (ADC) was intended to be a US$25 fee charged to outgoing passengers from January this year, as stipulated in the contract signed with GMR in 2010. The anticipated US$25 million the charge would raise was to go towards the cost of renovating INIA’s infrastructure.

However the then-opposition Dhivehi Qaumee Party (DQP), which had ardently opposed the handing of the airport to GMR, won a case in the Civil Court last year blocking GMR from charging the ADC.

The Civil Court blocked the fee on the grounds that it was essentially the same as a pre-existing Airport Services Charge (ASC), and that any new fees would constitute a new tax and was subsequently required to go through the People’s Majlis.

Following the court ruling former President Nasheed’s administration agreed that the ADC would have to be deducted from GMR’s concession fee paid to the MACL.

Managing Director of MACL Mohamed Ibrahim told Minivan News the company would not comment on the matter.

GMR paid MACL US$ 7.79 million in variable annual concession and fuel concession fees for the fourth quarter of 2011, after deducting US$ 100,000 as payment for insurance surcharge.

New Finance Minister Abdulla Jihad has previously said the ADC issue will bankrupt the MACL.

“I don’t believe that GMR can deduct that amount from the payment owed to the government. The estimated US$30 million for this year must be paid. If the payment is not received it would be difficult to run the Airports Company,” Jihad said.

“The Civil Court ruled against that charge. Hence that amount must not be deducted from the payment to the government which would reduce its income,” Jihad argued. ”The Airports Company might face losses if that happens,” he said.

Meanwhile, new Foreign Minister Dr Abdul Samad Abdulla assured his Indian counterpart that all existing investment agreements would be honoured despite the change of government on February 7.

According to Indian newspaper The Hindu, Samad assured Indian External Affairs Minister S.M. Krishna that the government’s policy was unchanged, after his counterpart expressed the desire that the Maldives remained friendly to outside investors.

Longstanding opposition

The contentious Civil Court case was filed by DQP in a longstanding campaign against Nasheed’s government awarding the airport redevelopment to GMR. DQP leader Dr Hassan Saeed is now President Mohamed Waheed Hassan’s special advisor, while DQP Vice-President Dr Mohamed Jameel is the new Home Minister.

A 24-page book released by the DQP while it was in opposition presents the government’s lease of Ibrahim Nasir International Airport (INIA) to developer GMR as a threat to local industry that will “enslave the nation and its economy”.

Former President’s Office Press Secretary Mohamed Zuhair at the time of the pamphlet’s publication said that he felt the title’s wording was “very strong”, and drew a faulty comparison between international cooperation for mutual benefit and foreign occupation of a people and market for selfish purposes.

“The purpose of all this is to make Maldivians mistakenly feel like they are under occupation and the country is being sold out,” said Zuhair, who pointed out that the government “wouldn’t have gone out for an international bid [on the airport project] if there was a way to borrow money and do it internally.”

He explained that the airport now yields “a bulk” of the national revenue, in dollars: “If foreign visitors increase, income increases. It’s simple math.”

GMR has also drawn the ire of local company MVK Maldives Pvt Ltd after INIA, backed by a civil court ruling, refused to renew MVK’s lease and ordered the MVK to vacate the Alpha MVKB Duty Free shop and hand the premises to GMR.

Consequently, DQP MP Riyaz Rasheed submitted a resolution to the Majlis to prevent GMR from taking over the management of duty free shops and bonded warehouses from local businesses. However, Rasheed withdrew the resolution on April 2.

The decision to finalise a deal to develop Ibrahim Nasir International Airport (INIA) was agreed under the administration of former President Mohamed Nasheed in 2010. GMR emerged victorious in the bidding process, amid political opposition on largely nationalistic grounds.

Confidence in GMR’s $511 million dollar INIA project appeared to take a hit after the resignation of President Nasheed in February was accompanied by a five percent drop in GMR’s share prices before bouncing back shortly after.

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MATI concerned over “concerted international campaign” against several resort owners

The Maldives Association of Tourism Industry (MATI) has issued a statement expressing “serious concern” over what it describes as a “concerted international campaign” against several of the country’s resort operators.

MATI claimed that calls from the Maldives Tourism Advisory (MTA) for tourists to avoid certain properties on the basis of ownership were “libelous in the extreme”, as the allegations against the tourist resort operators “have not been proven either through an investigation or a court of law.”

The MTA website features a ‘traffic light’ system with “red” resorts recently appearing to have been expanded to include an assortment of 18 properties owned by Vice President Waheed Deen and senior figures associated with the new ruling coalition, including Jumhoree Party (JP) Leader Gasim Ibrahim, Progressive Party of the Maldives (PPM) MP Abdulla Jabir, and Hussain ‘Champa’ Afeef.

MATI claimed that “unsubstantiated charges directed at some resort operators [will] result not only in loss of business at their resorts, but in loss of reputation and standing in international markets and the global community.”

“A call to boycott the resorts could [also] lead to enormous loss of business and lay-off of resort staff and support workers, not to mention those several small businesses that cater to the tourism industry that will be affected.”

The resort body accused the campaigners of “not having the decency to come out in the open” and “hiding behind the safe veil of the internet.”

“It is our belief that the several accusations and charges directed at the operators of resort businesses must be proven in a court of law before these businesses are subject to industrial action or denunciation.”

The MTA yesterday released a statement in response to MATI, emphasising that it was not calling for a boycott but rather “supplementing” existing travel advice from the UK’s Foreign and Commonwealth Office (FCO).

“Visitors choosing to be selective and avoiding resorts tainted by the actions of their owners might lead to some loss of business to these resorts, but we are quite convinced that it would not have an overall impact on the economy of the Maldives,” the MTA said in a statement. “Nor would it seriously affect the prospects of employment for Maldivians. This is proven by the government’s own figures showing a healthy increase in tourism arrivals.”

“While MATI mentions investigations of resort owners in a “court of law” it can clearly be seen that the Maldivian judiciary would be an inappropriate institution for such an investigation, given that one of MATI’s senior members (and whose resorts we recommend avoiding) sits on the Judicial Services Commission (JSC), the body tasked with overseeing the judiciary,” the MTA noted.

“”The only ‘investigation’ that we are aware of at present is the Commission of National Inquiry (CNI). This is deemed to be neither serious, timely nor unbiased by international observers and most Maldivians. No serious efforts have been made to address the deficiencies in this investigation, and they do not involve the resort owners mentioned in the MTA.

“The MTA always carefully considers all the available facts from several sources when recommending resorts to be avoided. There is no necessity to await ‘investigations’ and “courts of law” (as the MATI statement suggests) as MTA recommendations are based on important information that serves to enable visitor choice.”

Quarterly tourism figures published by the Maldives Marketing and Public Relations Corporation (MMPRC) showed a 3.3 percent rise in visitor arrivals compared to the same period in 2011, however this was lower than the 12.6 percent growth seen in the first quarter of 2011 compared to 2010.

Growth in Chinese arrivals slowed dramatically due to cancelled charter flights, while several of the country’s mainstay markets declined – including Italy, France and the UK. Russian, German, Swiss and Middle Eastern arrivals showed strong increases.

Tourism Minister Ahmed Adheeb and former Tourism Minister Dr Mariyam Zulfa were not responding at time of press.

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