Thursday, July 1, 2010

Confusion in Maldives (July 1, 2010)

Unbeknownst to much of India, things have come to a real pass in Maldives.
The Maldives cabinet resigned en masse on Tuesday amid growing frustration over the parliamentarians holding them at ransom and for not being able to perform their duties, reports say. The cabinet protested the behaviour of opposition MPs who they said were “hijacking” the powers of the executive and making it impossible for the cabinet Ministers to discharge their constitutional duties and deliver the government’s election manifesto.

The tip of the iceberg points to two parliament members, Qasim Ibrahim Burumaa (MP for Maamigili and leader of the Jumhooree Party) and Abdulla Yameen (MP for Mulaku and leader of the People's Alliance), who are reportedly in custody, being interrogated over the ‘cash-for-votes’ scam. Latest reports say that both Qasim and Yameen are to be summoned to the criminal court late night, according to their lawyer.

Although there is no official stand on the reason for the two parliamentarians being investigated, sources within the government have indicated that the matter is to do with ‘cash-for-votes’, in other words, parliament members taking bribes in return for votes against bills submitted by the government as well as supporting legislation that is widely believed to be undermining the executive authority of the country. The President, Md. Nasheed and the Vice President have not resigned from office.

The Maldives has a Presidential system of government, with a separation of powers between the executive, the legislative and the judiciary, guaranteed under a Constitution that was enacted in 2008. The executive (The President and Vice President) and the legislature (the Majlis or the Parliament) in the Maldives are elected directly by the people at two separate polls. President Nasheed and Vice President Waheed were elected in October 2008. Nasheed's term ends in October 2013 while the parliament can be in office until May 2014.

The Majlis, or parliament, has 77 directly elected members. The new parliament was sworn into office in May 2009. The opposition Dhivehi Rayyithunge Party, which is aligned to the People’s Alliance party, has 34 seats in the Majlis and the support of a number of independent MPs. Nasheed’s Maldivian Democratic Party (MDP) has 28 MPs and the support of four independent MPs.
So, the DRP has the control of the Majlis whereas the MDP has control of the Presidency and Vice-Presidency. The popular mandate in 2008 was that people wanted M.A.Gayoom ousted, but not the DRP. The very fact that MDP won so many seats was then claimed to be an indication of the anti-incumbency vote. Nevertheless, fact remains that the opposition still controls the Majlis.

More from elsewhere,
Speaking after the press conference, cabinet members said that the People’s Majlis, in which opposition parties hold a small majority of seats, was becoming increasingly “dictatorial,” issuing numerous edicts to prevent ministers from carrying out their duties. “Every passing week, there is another attempt by opposition MPs to wrestle more control from the executive. They are making the country ungovernable,” said Attorney General Husnu Suood.

“Opposition MPs are obstructing the business of government. They have awarded themselves powers to appoint members to independent institutions, when this is clearly a prerogative of the President. They have declared that the government cannot raise any loans from abroad or rent any government or state asset without their say-so. And they are threatening Ministers with no confidence motions on spurious grounds,” said Finance Minister Ali Hashim.

“The opposition MPs are operating a ‘scorched Earth’ policy, trying to stop the government from doing any work to help the people. We have told the President that we cannot continue to work like this,” stated Foreign Minister Dr Ahmed Shaheed.

Maldivian political stalemate continues
From the above report, the most important facts, parsed right:
Abdullah Yameen Abdul Gayoom is the half-brother of Maumoon Abdul Gayoom (the former and long-term President of Maldives who was ousted in the 2008 election). Qasim Ibrahim is probably the richest individual businessman in Maldives. While there was no report of any violence, Male for one remained deeply polarized between the government and its opponents. Former President M. A. Gayoom continues to have support among the elite and business class in the city of around 1.2 lakh residents.
The opposition demand:
The opposition had planned to bring a no-confidence motion against the education minister on Wednesday, but the cabinet resignation pre-empted the move. "The only solution is for President Nasheed to resign and go for fresh elections to see how popular his government is," Umar Naseer, deputy leader of the main opposition Dhivehi Raithunge Party (DRP), told Associated Press.
So this is a wrangling for power. M.A.Gayoom has smelt blood and being out of power for 2 years has only increased his thirst for power.

What is the cited reason for the opposition? Privatization. An example of the privatization process, underway in Maldives, is below:
GMR Infrastructure gains after winning Maldives airport bid

GMR-group Bangalore-based GMR Infrastructure Ltd said its consortium with Malaysia Airports Holdings Berhad (MAHB) won the bid to build, operate, modernise and expand the Male International Airport (MIA) in Maldives. No financial details were provided. MIA includes the sea-plane port. The mandate is for the next 25 years. The Maldives government had invited three parties, namely, Aeroport De Paris, France-TAV, Turkey consortium; Zurich Airport-GVK consortium and the GMR-MAHB consortium to take part in the bid process.

On Friday, GMR Infrastructure shares ended 1.5% up at Rs57.70 at 9:42 IST, on the Bombay Stock Exchange after the consortium of the company won the bid to build, operate, modernise and expand Male' International Airport. The company did not disclose the size of the bid but media reports suggested total capital expenditure for the airport is pegged at 500 million US dollars. According to stock market reports, on consolidated basis, GMR Infrastructure's net profit rose 37.2% to 158.66 million dollars on 15.3% decline in net sales of 2.4 billion US$ in Q4 March 2010 over Q4 March 2009.

GMR along with Malaysian airport had got the expansion project of building and expanding the Male International Airport in Maldives. The GMR group which is nearing completion in building the 8th largest airport terminal in the world in Delhi which has a floor space 5.4 million sq ft pipped two strong contenders from India. One was the Anil Dhirubhai Ambani group with Mexico Airports Aeropuertos and the other the GVK- Lughafen Zurich AG combine.

The new government of Maldives, which took office in Novermber 2008 after 30 years of dictatorship, had invited bids to build a new terminal at the Male’ International Airport that would have a capacity of handling 5 million passengers in one year with bays to room 12 aircrafts. The project has to be completed by 2014 and would demand operation, maintenance, expansion, rehabilitation and modernization of the existing airport. The GMR group, besides the Delhi Airport modernization and expansion had built the new Hyderabad airport. It runs the international airport of Istanbul; Sabiha Gokcen . It also runs the Malaysian Airports Holding Berhad.
But that is hardly likely to be the issue. Look at this report from June 12, 2010.

Going After Government Looters
The government of the Maldives wants its money back — $400 million to be precise. That is the amount that it estimates was looted by its former president, Maumoon Abdul Gayoom, and his associates.

A report from the Maldives’ national auditor released in 2009 reads like a guidebook on self-enrichment. The president’s spending was “out of control,” it said, as Mr. Gayoom used his power to live a lavish lifestyle and extend largesse to those around him. An estimated $9.5 million was spent buying and delivering a luxury yacht from Germany for the president; $17 million was spent on renovations of the presidential palace and family houses. Mr. Gayoom built a saltwater swimming pool, a badminton court and a gymnasium, and he bought 11 speed boats and at least 55 cars — including the country’s only Mercedes-Benz, the audit said.

And the list goes on, from Loro Piana suits and trousers to watches and hefty bills for medical services in Singapore for “important people” and their families. There was a $70,000 trip to Dubai by the first lady in 2007, a $20,000 bill for a member of the family of the former president to stay a week at the Grand Hyatt in Singapore. On one occasion, diapers were sent to the islands by airfreight from Britain for Mr. Gayoom’s grandson. Even allocations made to Mr. Gayoom’s office for welfare distribution were spent on the president’s family and their friends, senior government staff members and their friends and members of Parliament, according to the report.

Mr. Gayoom could not be reached for comment. In September, his office denied accusations of corruption and embezzlement made by government commissions and auditors. His financial affairs are still being investigated.

The Maldives government is beginning the paper chase, but it lacks resources to unravel a complex trail that it assumes runs through the British Channel Islands, Singapore and Malaysia. Help is coming, notably from the Stolen Asset Recovery Initiative, or StAR, run by the World Bank and the United Nations. The program estimates conservatively that $20 billion to $40 billion is stolen annually from developing countries through bribery, misappropriation and corruption. That figure represents about 15 percent to 30 percent of aid to the developing world.

While there has been progress in the form of restitution of funds looted from poor countries, some experts fear that the issue may be sliding lower on the international agenda as the financial crisis rolls on. During the past 16 years, $5 billion has been recovered, according to the program. Repatriating more could help alleviate poverty in some countries: The World Bank says that every $100 million returned could finance the linking of 250,000 homes to clean water supplies each year or treatment for more than 600,000 people with H.I.V. and AIDS. “People can make a huge profit from corruption and get away with it,” Jeffrey T. Radebe, the South African minister of justice, said in the past week in Paris. “We can do more to ensure that corruption doesn’t pay — and seize assets.”

StAR sets up teams of experts and advises on the legislation needed to track and repatriate funds. It is working with 22 countries in Europe, Africa, the Middle East, Latin America and Asia, including Guatemala, Haiti, Indonesia and Paraguay. Some governments are also undertaking their own initiatives. Switzerland says it has repatriated 1.7 billion francs, or $1.5 billion, in stolen assets to developing countries. That includes about $684 million looted by Ferdinand E. Marcos, the former dictator of the Philippines, and $700 million from Sani Abacha, the ex-leader of Nigeria. More than $174 million taken by Vladimiro Montesinos, the former head of Peruvian intelligenceand adviser to ex-President Alberto Fujimori, has been returned from a variety of jurisdictions.

The Swiss government has used a constitutional provision to block stolen funds. It hopes that an act directly defining the methods of freezing, confiscating and restoring stolen assets will take effect early next year, helping the process. There has also been an increase in investigations, settlements and convictions in the United States under the Foreign Corrupt Practices Act. In 2008, the Department of Justice concluded 16 enforcement actions against individuals and companies under the act, a record since its passage in 1977.

In Britain, the government has allocated funds from its development budget to finance Metropolitan Police investigations of foreign corruption and asset recovery. “We’ve come a long way,” said Ngozi Okonjo-Iweala, a World Bank managing director and former Nigerian finance minister. “But I would not be complacent.”
In the Maldives, the government wants its money back to help offset the decline in tourism, which has been hit by the global downturn, and to plug a budget deficit estimated last year at 34 percent of G.D.P. “What we are asking the World Bank is, help us get this back,” Mr. Hashim said. “Then we won’t need to have that much” foreign aid, he said.
So at the end of the day, this may be M.A.Gayoom pre-empting an anti-corruption drive by Anni Nasheed. Now that India enjoys very good relationship with either side, it may have to steer both sides into running the country. While Anni Nasheed's anti-corruption drive is laudable, it is hardly realpolitik given that he has no majority in the Majlis. Like SHW in 1996, he may have to put up with the fact that he cant do much on this direction. That may cool down M.A.Gayoom & co. Given that Maldives has become increasingly a target for al qaeda-types, especially on the uninhabited atolls, and Anni Nasheed's showmanship on global warming, it is better to have good governance and hope to wrest control of the Majlis in the next election than wreck it in popular bravado. It is not clear if the man on the street will re-elect Anni Nasheed, if an election is held now. That probably explains why the opposition is asking for a re-election. Better safe than sorry. But then Anni Nasheed is British educated and from the youngistan brigade of Maldives. More than the "change-man", Anni Nasheed has shown an impressive disdain for status quo in Maldives. He may want to go down in flames rather than sticking around and fixing things in the long run. If that is the case, another nuisance for the MEA babus, given that Nepal is another basketcase with a melee in the tumbler.



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