An aviation expert unconnected with the government or bidding process, and with extensive experience of Male’ International Airport, has told Minivan News on condition of anonymity that the state of arguably the country’s most critical piece of economic infrastructure “is far worse than most people realise” and in “urgent need of major investment”.
“The runway hasn’t been resurfaced for 18 years, and it still has cracks and depressions caused by the 2004 tsunami,” he explained.
“Even now there are spots which need to be cut out and resurfaced,” he said, naming several international carriers that had privately expressed concern to the authorities about minor damage caused to their planes by the state of the runway.
Furthermore, the airport does not meet NX14 standards of the International Civil Aviation Organisation (ICAO) because of the proximity of buildings to the runway, the source said.
“The last time ICAO did audits they were not satisfied. If the airport is not upgraded, the worse case scenario is that ICAO will blacklist the airport – and that means nobody will land here. I’m not scaremongering, but the airport needs major investment,” he said.
“I don’t think the politicians understand the situation,” he explained. “The runway needs urgent repair and maintenance, and aircraft from places like Germany – that have travelled over 10 hours with 300 passengers on board – are being held above the airport for 14-20 minutes waiting for a parking space. This is especially a problem during the European winter (peak arrivals).”
Private jets were occasionally being diverted to airports such as Trivandrum and Colombo because of a lack of parking space, denying the government a stream of income, he added – “and there’s no standard of parking, it’s like a haystack.”
The “geometry and design of the airport” were fundamental limitations of the current layout, he noted, but both the current and previous governments were financially unable to invest the significant amount of money required to repair and upgrade the facility.
“In 2006 the former government contracted UK company Scott Wilson to draw up a masterplan, with three options costing US$300 million. The government could not find the funding to go ahead with it,” he said.
“We’re at a crossroads – either it gets privatised now, or it never does. It needs urgent and necessary expansion, and the runway needs to be repaired,” the source explained.
“If people do not agree with the airport being privatised like this, they should come to the bargaining table with something better – there are many multi-millionaires in Male’ who could co-operate on this,” he said.
“It’s not about airport revenue – plenty of countries privatise their airports. But in the Maldives the whole economy is completely dependent on incoming tourists, and most of the [financial] benefits are downstream [at resorts]. At the end of the day the country benefits by having a good airport.”
Not in national interest: opposition
Yesterday evening a coalition of opposition parties, including the Dhivehi Rayyithunge Party DRP), the People’s Alliance (PA), the Dhivehi Qaumee Party (DQP) and the Jumhooree Party (JP), accused the government of acting outside the national interest over the privatisation of Male’ International Airport, and signed an agreement to try and halt the process “inside or outside parliament” after the government accepted a bid from GMR-KLIA.
This afternoon a planned signing ceremony at the President’s Office in front of assembled media was first postponed and then reschedued for Wednesday, with Chairman of the Privatisation Committee Mahmood Razee claiming that the “documents were still pending.”
Daily newspaper Haveeru reported that the signing was cancelled because of disputes among board members of the incumbent airport operator, Maldives Airports Company Limited (MACL), over who would sign the document.
The GMR-KLIA bid accepted by the government will involve an upfront payment of US$78 million and one percent of the airport’s profit until 2014, increasing to 10 percent from 2015 to 2035. GMR will also pay 15 percent of fuel trade revenues to the government in the first four years, and 27 percent from 2015 to 2035.
The two other bids – from Turkish TAV Airports Holdings Company/French Airports De Paris and Swiss Flughafen Zurich AG/GVK Airport Developers – involved substantially less upfront sums but 2-3 times the profit sharing over the life of the agreement.
The statement signed by the oppositition parties condemning the government’s decision to give the airport’s management in control of a foreign company, said the decision was “not made with the intention of benefiting the country’s economy” and that they would seek legal advice.
“[The airport] is one of the most valuable assets of the Maldives and it has a direct link to the independence of the state,” the statement said.
Last week DRP Deputy Leader Ibrahim Shareef accused the government of pushing the privatisation deal through without seeking approval from parliament, and said the DRP “will not honour this type of shady deal” if returned to power in 2013.
Razee meanwhile hit back at the opposition’s unspecified allegations of corruption, explaining that the World Bank’s International Finance Corporation (IFC) had been involved in the privatisation process as a transaction advisor since July 2009, “and would certainly not stand by if conduct was improper.”
“We started this process in December 2008. It was not something we thought up yesterday,” Razee said.
IFC representatives said they would not comment on the matter.