Laamu Gan Asseyri project to proceed: Tourism Minister

The government has apologised for miscommunications which led to the “unfortunate” media coverage of a contract between the Ministry of Tourism and J Hotels and Resorts for a mid-market tourism center at Laamu Gan Asseyri Project, Tourism Minister Mariyam Zulfa has said.

“The Cabinet did not decide to cancel the contract, if you read the government gazette closely it just put the project on hold for some time. The intention was never to withdraw the agreement,” she explained.

Minivan News recently reported along with local media that the Cabinet had terminated its contract with J Hotels and Resorts and would solicit further bids for the project. Company chairman and former MP Abdulla Jabir issued emphatic warnings that he would sue the government.

Jabir today said he has been informed by the Minister that the Cabinet would approve the project.

“So far I’ve been advised that it will go forward, so we’ll see how things go. I don’t know what the Cabinet will do, one day they make a decision the other day they change it, but in time we will see how it proceeds,” he said.

Jabir reiterated that the Minister had assured him that the project would go forward, and that he had no bad relations with any ministry.

Speaking with Minivan News yesterday Zulfa said, “J Hotel and the Tourism Ministry were and are keen to get the project going, especially since the President has said that the mid-market project is a priority to the government and that it will make sure that project gets done.”

Given the project’s value, Zulfa said the Cabinet wanted to ensure that everything was in line with the government’s vision before proceeding with the agreement. She believed the Cabinet had not been provided with sufficient information to make an informed decision on the matter.

Zulfa said she has now presented all the relevant information to the Cabinet, and the project will move forward.

“The government enjoys a good relation with the development party, and we regret the unfortunate turn of events that led to this misunderstanding,” she said.

The Asseyri project, launched in March, aims to bring two 300-bed hotels and 69 guest houses to the 25 hectare area along with recreation activities, water sports and restaurants.

“Right now we can’t cater to the mid-market tourists who want to have options when they make a trip to or within the Maldives. This will give them that opportunity. And the basis of the project will be the natural beauty–the beach, lagoon and reef are absolutely fantastic,” said Zulfa.

She added that the mid-market project is designed in and around the airport development project, and will offer job opportunities and economic growth.

Moving away from the existing one island, one hotel tourism product, the Asseyri (beachside) project intends to rent out commercial components of an area to different parties, allowing larger numbers of local entrepreneurs to participate in the Maldives’ lucrative tourism sector.

In July, Addu City Council announced its intention to incorporate the project’s core values and aspects into Addu City’s development plan.

The two areas ear-marked for the project are the Maafishi Area of Hulhumeedhoo Island and the start of the Hankede area, Hithadhoo.


J Hotels and Resorts awarded mid-market tourism project in Laamu Atoll

The Tourism Ministry has awarded the ‘Asseyri’ project to develop mid-market tourism in Laamu Atoll Gan to J Hotels and Resorts, reports Haveeru.

J Hotels and Resorts – owned by former MP Abdulla Jabir who has announced that he will be running for chairperson of the ruling Maldivian Democratic Party (MDP) – was chosen among three bidders for the project, according to a Tourism Ministry official.

The project involves developing a 25 hectare area with 1,500 beds, including a 300-bed hotel and 79 guest houses, as well as spas and sports facilities.

State Minister for Tourism Thoyyib Mohamed previously told Haveeru that while the government preferred a private party to develop and manage the whole project, the ministry had a ‘Plan B’ to lease out separate components of the project to different parties.


Adhaalath Party condemns Tourism Ministry’s decision over unpaid rents and fines

The religious conservative Adhaalath Party has condemned the Tourism Ministry for backing down on threats to withhold operating licenses of resorts with unpaid rent and fines.

The Tourism Ministry warned resort facilities with unpaid rents and fines to settle at least 25 percent of the outstanding amounts by July 20 or face revoking of licenses. However the ministry later decided not to follow through on the warning after at least seven out of ten resorts failed to comply within the period.

“Adhaalath Party believes that this decision made by the Tourism Ministry not to withhold the licenses will have adverse affects on society,” said the Adhaalath Party in a press statement. “It would cause the public to lose confidence in a state institute.”

Adhaalath Party claimed to have information that resorts owned by a Maldivian Democratic Party (MDP) MP and Economic Advisor to the President along with a candidate for the MDP Chairperson post were among the resorts on the list.

“This decision of the Tourism Ministry will encourage individuals and businessman not to uphold the laws,” the party said. “As a result, the state will have to face difficulties in collecting revenues owed and it is possible that it affects the domestic economy.”

The party said that it was “very irresponsible” of the Tourism Ministry to make such a decision, adding that a delegation from Adhaalath is due to meet ministry officials over the issue.

Following the Tourism Ministry’s decision, the Commissioner General of Taxation Yazeed Mohamed told newspaper Haveeru that “even if the Tourism Ministry does not take measures, MIRA will fulfill its legal responsibilities.”

MIRA is currently pursuing cases at the Civil Court against a number of tourist facilities to recover unpaid rents.


MIRA “will not back down” over unpaid resort rents: Commissioner General of Taxation

The Maldives Inland Revenue Authority (MIRA) “will not back down” or hesitate to take legal measures against resorts with outstanding rents and fines.

Commissioner General of Taxation Yazeed Mohamed told newspaper Haveeru today that “even if the Tourism Ministry does not take measures, MIRA will fulfill its legal responsibilities.”

MIRA is currently pursuing cases at the Civil Court against a number of tourist facilities to recover unpaid rents.

The Tourism Ministry last week warned 10 resorts with outstanding rents and fines to settle at least 25 percent of debts to the state by Wednesday this week, or face revoking or withholding of operating licenses.

Following deliberations by the cabinet, the ministry gave a 90-day notice as “a last warning” on July 12 for the tourist facilities to pay the overdue amounts in full.

However according to a press statement issued by the ministry yesterday, the government has decided not to enforce the threat of revoking licenses after the resorts appealed for leniency, citing global economic turmoil and difficulties in paying large sums in a short period.

According to the press statement, the decision was made after the tourist businesses provided a schedule for making the payments in installments over a course of time. Neither the proposed deadline nor the length of the extension was specified in the statement.

Commissioner General Yazeed meanwhile revealed that only three out of the 10 resorts had paid 25 percent of the outstanding rent and fines as of yesterday. The three resorts that complied after the Tourism Ministry’s “last warning” were Park Hyatt, Six Senses Laamu and Huvadhumafushi.

Haveeru reports that resorts with unpaid rent and fines include those owned by Maldivian Democratic Party (MDP) MP Ahmed Hamza and Economic Advisor to the President Ali Shiyam. Other resorts on the list include Zitali Resort and Spa, owned by Hamza’s brother Moosa Shiyam; Giraavaru Tourist Resort, owned by Abdul Rauf, M. Sun Rose; and resorts owned by Yacht Tours, whose chairman and former MP Abdulla Jabir is a candidate for the post of MDP chairperson.


Tourist facilities given 3-months to pay outstanding rent, fines

The Ministry of Tourism has warned tourist resorts, hotels and guest houses with outstanding debts to settle at least 25 percent of unpaid rent and fines by July 20, 2011 or face the revoking of licenses.

According to a statement released by the ministry Thursday, operating licenses granted by the ministry will be revoked or withheld if the overdue amounts owed to the state were not paid in full during the next three months.

“If the monies owed by July 20, 2011 is not paid in the next three months from July 12, 2011, the cases [of non-payment of rent and fines] will be forwarded to the Ministry of Finance and Treasury,” the statement said.

It adds that the resorts, hotels and guest houses with unpaid rent and fines have been informed of the government’s decision.

Local media meanwhile reported that the tourism companies owed a total of US$20 million to the government.

Tourism Ministry Deputy Director General Hassan Zameer told Minivan News today that the Maldives Inland Revenue Authority (MIRA) was responsible for tax collection and would be calculating the figure owed as of July 20.

Zameer however confirmed that the rent and fines for non-payment were owed by a total of 10 resorts.

Asked if the ministry was receiving cooperation from the tourist businesses, Zameer said that it was “hard to say they’ve been cooperating because the measure we’ve taken was of the last resort.”

The businesses were given “a final warning” on July 5, he explained, after which the cabinet decided to give a 90-day notice as stipulated in the tourism laws.

MIRA has meanwhile sued six of the companies to recover outstanding rent and fines. The cases are ongoing at the Civil Court.

According to MIRA’s quarterly report for June, a total of Rf1.2 billion (US$93 million) was collected in the second quarter, 81 percent of which were dollar receipts.

Tourism land rent, tourism goods and services tax (TGST) and tourism tax represents 23 percent, 17 percent and 16 percent respectively of total revenue.

A total of Rf521.5 million (US$40.5 million) was collected as tax revenue in the month of June.


Addu council looking beyond single island resort model for mid-market push

Addu City Council has announced plans to kick-start a project aimed at attracting mid-market tourism to the region in a change of policy from the country’s established one resort per island policy.

Following in the footsteps of developments on the island of Gan in Laamu Atoll, Addu City authorities have said they will develop areas of the city as a Asseyri (Beachside) Project.

The project represents a tourism development plan by which guest accommodation, alongside recreation and entertainment facilities, will be developed in a specific area with each commercial component being rented out to different parties. The system differs from the country’s established tourism model that has generally been based on a single enterprise operating a resort property exclusively on a designated island.

The announcement of the Addu City project follows a cabinet decision made earlier this year to create an integrated tourism development policy.

“We have identified the areas we want to develop for the Asseyri project, and we have sent the proposals to the Tourism Ministry for approval,” says Abdullah Sodiq, Mayor of Addu City.

The two areas ear-marked for development under this project are the Maafishi Area of Hulhumeedhoo Island and the start of the Hankede area, Hithadhoo.


Moving away from the existing one island, one hotel tourism product, an Asseyri project aims to open up venues to allow larger numbers of local entrepreneurs to participate in the Maldives’ lucrative tourism sector.

The project will also open up doors for budget and mid-market tourists to visit Maldives, diversifying the Maldivian tourism product, according to developers.

A pilot Asseyri project was launched by the Tourism Minister Dr Mariyam Zulfa in Gan in March. According to the proposed plans, two 300 bed hotels, 69 guest houses, as well as a number of restaurants, spas and sports/recreational facilities will be developed on the 25 hectares of land located on the western beach side of the island.

In trying to emulate the Gan project, Mayor Sodiq said “the Addu Assyeri project will also be a multi-owner project; with lodgings and other facilities like restaurants, spas and sports areas each being owned by a different enterprises.”

The proposals for the Addu project have now reportedly been drawn up and sent to the ministry for approval.

“The tourism ministry shared with us the details of their ongoing project at Gan and has been very supportive of our maiden venture into this area,” Sodiq said.

Addu City Council hopes the project will give a boost to the local economy by creating more job opportunities and helping with aims to increase the GDP of Addu Atoll within the next three years. It will also attract more visitors to the city which is already home to properties like Shangri-La’s Villingili Resort and Spa.

Finding developers

Tourism authorities in the country have also pledged to try and assist the Addu City beach-side developments.

“We are holding discussions with Addu City Council to plan their Asseyri project,” says Moosa Zameer Hassan, Deputy Director General at the Planning Department of the Ministry of Tourism, Arts and Culture.

Hassan added that the Tourism Ministry was currently working to change its approach to the Gan Asseyri project after evaluating project proposals that were submitted ahead of a June deadline.

“We received two proposals, one from a local company to do the water and sanitation component of [the project], the other from a foreign company to develop the hotel component. At present we are negotiating with both parties,” Hassan said. The initial idea for the project was to try and find a party interested in the total development of the whole area and to lease out the different components of it afterwards, though tourism authorities are now reviewing this.

“The area is very big that might be the reason [for the review]. So now we are going to put out a tender for the development of hotels and guest houses, and hold discussions with the local council for them to rent out the land plots for other components of the project like restaurants, spas, recreational facilities and such,” Hassan claimed.

Aslam Moosa, a representative for Gan Island Council said he and his fellow members had been kept in the dark regarding the project.

“Yes, I have seen the area marked on the map, and heard the announcement for the proposals, but nobody has held discussions with us on the project,” he added. Moosa claimed that the council was presently only involved in the development of a 300 bed hotel by an Indian Company in Gan.

Hassan confirmed that discussions have not been held since local councils were elected. in February. “But we hope to hold discussions with them and to be able to rent out plots of land within two months,” he said.

While the tender for hotels would be open to foreign parties, bidding for running guest houses will be only for locals, Hassan stressed.

“Guest houses have always been protected investments just for locals. By law, the Tourism Ministry’s involvement is vital as guest houses and hotels can only be leased by them. The ministry does not envisage giving priority to residents of the Atolls involved,” he said. “Bidding for guest accommodation will be a process open to all Maldivians. Though local councils can decide if they will prioritise residents of their island in the bidding for involvement in other components of the project.”

Meanwhile, Addu City Council has said it is finishing up the administrative work for the Asseyri project and would soon be drawing up the final plans.

“We are very confident that our proposed plan will be approved by the ministry. It will be well regulated, we will assign land areas and have a limit on the height of the buildings.”

The tentative date to complete the tender for the Addu Asseyri project is by September. However, Sodig says actual physical work on the project will be put off until December, to enable the scheduled 17th South Asian Association for Regional Cooperation (SAARC) summit to go without any hitches.


Hudhufushi lease renewed

The Tourism Ministry has renewed the lease for Hudhufushi in Lhaviyani Atoll despite the resort island’s owner owing more than US$85 million in unpaid rent.

According to a 2009 audit report, Hudhufushi’s leasee Abdul Rauf owed US$57.7 million in unpaid rent to the government going back to 2002, the majority of the amount accumulated fines from years of non-payment.

The lease rent owned by the Hudhufushi resort is one of the government’s largest debtors in the tourism sector, and was noted in both the tourism ministry and trade ministry’s audit reports for 2007.

Under the original 35 year lease agreement signed between Rauf and the government in 2000, the resort was to open on June 30, 2002.

Former Auditor General Ibrahim Naseem, dismissed by parliament last year days after ordering past and present government ministers to submit to an audit of their assets, had recommended repossessing the island and establishing a mechanism to take legal action against tax evasion.

His audit suggested that at least Rf117 million (US$910,000) of the amount was recoverable.

Local media this week reported that the debt had climbed to US$85 million, and that the government had renewed the lease under a new agreement stating that the amount would be paid back starting from the 11th year of the agreement.

In addition, the agreement requires two payments of US$750,000 before June 1 and December 1 of this year, local newspaper Haveeru reported, or it will be terminated.

Cofounder of local environmental NGO Bluepeace, Ali Rilwan, has meanwhile claimed that the island forms a natural bay that is home to rays and baby sharks, and was “a very important ecological site.”

“The development will cause a lot of disturbance – there was a lot of controversy even at the beginning on the process,” he said. “There were no studies before the island was awarded and it has not been subject to an environmental impact assessment.”

Rilwan suggested that in such instances the government should have provision to exchange an island for another, to allow the preservation of ecological sites such as Hudhufushi.

“There are only three islands in the Maldives that are listed as protected, at least on paper,” he said. “Hudhufushi has a mangrove area, which is a carbon sink – these are mentioned in the government’s carbon report. Half the mangroves in the Maldives have been reclaimed in the last 30-40 years.”

“Ecotourism sites such as these are rare in the Maldives and can generate an income as they make for wonderful photographs,” he said.

Minivan News contacted the tourism ministry for comment and was referred to Deputy Minister Ismail Yasir, but he was not responding at time of press.


Shanghai newspaper reports Chinese honeymooner dead in robbery

The Shanghai Daily newspaper has reported that a Chinese national on honeymoon in the Maldives was killed and his wife injured during a robbery last Sunday 14 March.

The English-language daily reported that the man, identified by his surname ‘Dai’, was a software engineer in his 20s who worked for the telecommunications company Alcatel Shanghai Bell.  The newspaper attributed the information to a statement issued by the company.

The report said Dai’s body was covered with bruises and cuts, and that the cause of his death had not yet been confirmed by Maldives Police Service.

Dai’s parents arrived in the Maldives after being informed of their son’s death and were initially told he had drowned, the newspaper reported.

Police confirmed to Minivan News today that they received a report at 12:45pm on 14 March that a Chinese national, Rui Dai, died while snorkelling at Holiday Inn Kandooma Resort, South Malé Atoll.

Police Sub-Inspector Ahmed Shiyam said they had found no major injuries on his body and police suspected he had drowned. He said a post-mortem examination was not performed on the body, and there were no reports of Dai’s wife being injured.

A source at Kandooma Resort confirmed a guest by the name of Dai and his wife were honeymooning at the resort, and that Dai had died the day after arriving on the island.

“He drowned while swimming in 5-10 feet of water,” the source said, adding that the body was found in the morning between 10:30am and 12pm by housekeeping staff and a French guest.

There was no bruising on the body, the source noted, adding that Dai’s family had arrived to pick up his body and were staying at the Holiday Inn in Malé.

Management at Kandooma had ordered staff not to divulge any information about the case, the source noted.

The Ministry of Foreign Affairs said they had no information on a foreigner being robbed and killed, but said they had received a police report on Sunday about a man who died in a snorkelling accident. The President’s Office did not know about the murder claims, either.

Minivan News is seeking clarification of the reports from the Shanghai Daily and Dai’s employer, Alcatel Shanghai Bell, who released the report in China.

Dai is the second Chinese national to die in the Maldives this month.

Another Chinese tourist, Yeh Shihwei, drowned while snorkelling, also on his honeymoon, at Chaaya Lagoon Hakurahura Island Resort on 1 March 2010.

The resort manager for Chaaya Lagoon confirmed Shihwei died accidentally while snorkelling.


Government departments strike over salaries

Staff at several government departments, including the fisheries ministry and the attorney general’s office, have gone on strike in protest at the restoration of salaries for only some areas of government.

Staff a some of the other ministries, including the tourism ministry, are rumoured to be deciding whether they should take part.

Yesterday salaries were restored for staff at the independent commissions, courts, parliament and the judicial services. The president announced over the weekend that the remaining civil servant salaries will be restored in April if the country’s economy has stabilised.

A senior staff member from the attorney general’s office told Minivan News that more than 40 people working at the office were participating the strike, and would continue to do so until their received the restored salaries.

“We will come to the office every day, but we won’t be doing any work,” he said, claiming that the strikers were just trying to get their legal rights.

A senior staff member from the fisheries ministry confirmed that most of the civil servants at the ministry were on strike, including the management.

Some of the ministry’s senior staff had threatened legal action against the strikers, he said.

”We are working legally to get our rights,” he claimed, explaining that civil servants were present at the office but were refusing to work.

A civil servant working in the tourism ministry said staff were planning to sent a letter to the Civil Service Commission (CSC) about the issue.

”We will decide to strike or not depending on the answer we get,” she said.

The economic ministry said that all of its staffs were present and all of them were working “as normal.” A staff member said that they were not planning to strike.

Spokesman for the Dhivehi Rayyithunge Party (DRP) Ibrahim Shareef said that no legal action could be taken against the civil servants protesting.

”It is a right for the civl servants according to the law,” Shareef said, but added that the DRP had not yet decided whether to support the strike.

CSC spokesman Mohamed Fahmy Hassan said the CSC had yet to discuss the issue in detail but was currently “definitely not calling for strikes”, and was instead trying to solve the dispute through administrative and legal means.

“We have stated very openly that if we cannot solve it administratively, we will take the issue to court until we get a verdict,” he said.

Strikes would disrupt the services provided by the ministries and inconvenience the public, he added.

“I think the fact that some salaries have been restored has made it harder to persuade civil servants that the country has a financial problem. It’s very unfair what’s happened.”

State Minister for Finance Ahmed Assad said that civil servants were entitled to strike for their rights.

”We have not decided to change any of our decisions yet,” Assad said, refusing to answer more questions “as it is too early to say anything.”