Majlis fast-tracks bill to lease islands without bidding

Majlis fast-tracks bill to lease islands without bidding
June 21 19:25 2016

The ruling party-dominated parliament voted today to push through changes to the tourism law that would authorise the government to lease islands without a competitive bidding process.

The government-sponsored amendments were only introduced Monday, but preliminary debate began at today’s sitting after MPs voted 31-5 in favour of a proposal by Speaker Abdul Maseeh Mohamed to fast-track the legislative process.

Opposition MPs accused the government of planning to “legalise corruption,” noting loopholes in the Tourism Act were exploited under President Abdulla Yameen’s watch to steal some US$65 million from resort lease payments.

The current law requires the ministry to make a public announcement and award islands for resort development to the highest bidder. But islands or land the government invests in wholly or through a joint venture are exempted from the procedure.

The latter provision was used by the state-owned Maldives Marketing and Public Relations Corporation to sublease some 59 islands, lagoons and plots of land for development as resorts, hotels and yacht marinas.

Some US$65.01million collected as acquisition costs for the properties was embezzled, according to a damning audit report released last February.

The new bill proposed by Majority Leader Ahmed Nihan seeks to allow the government to lease islands, lagoons and plots of land to private companies without a bidding process if they submit a proposal to the tourism ministry’s liking.

The aim of the new bill is to lay down criteria and procedures in the tourism law, the parliamentary group leader of the Progressive Party of Maldives said.

The changes will ensure “sustainable development” of the crucial tourism industry, he claimed.

Other PPM MPs also backed the proposed changes, insisting it would improve transparency and benefit the public.

After the debate, MPs voted 35-20 to send the bill to a committee of the full house for further review.

The bill is expected to pass as the ruling coalition controls a majority in the parliament.

The decision to fast-track the bill means it could be passed into law within a day.

The bill says the ministry must ensure that the site is suitable environmentally and seek approval from the president’s office, after which details must be submitted to the auditor general and the anti-corruption watchdog.

The private party must also be able to pay acquisition fees in full.

Other changes proposed to the tourism law include extending deadlines for resort lease extension payments, introducing fees for services provided by the tourism ministry, and allowing the government to sell its stake in joint venture tourism companies.

The bill would also reverse an exemption for guesthouses from paying a ‘green tax’ introduced last November.

If the bill is passed, guesthouses would also have to pay US$6 per guest per night tax.

Opposition MPs strongly objected to the move, accusing the government of planning to “destroy” the burgeoning local tourism sector.

The government has also ignored mid-market tourism in its promotional campaigns, MPs said, whilst the abrupt imposition of the tax would affect advance bookings.

Heated arguments meanwhile broke out in the chamber when MP Rozaina Adam brought up corruption allegations against the first lady, prompting Speaker Abdul Maseeh Mohamed to adjourn proceedings around 11:20am.

The changes proposed to the tourism law comes after President Abdulla Yameen declared last month that his administration does not plan to expand luxury tourism.

“I am saying that we do not have an interest in expanding tourism. Because so many lagoons and islands have been leased, in a manner that is embarrassing to the Maldivian government. The government has been humiliated and has had to answer for this,” he said.

Yameen had said that the government now only plans to lease islands and lagoons for investors willing to pay large sums of money upfront.

He cited the lump sum payment of US$40 million for the Embudu lagoon near Malé as an example of the price-range the government would consider. Acquisition fees were previously as low as US$3 million.

Yameen had previously acknowledged that the MMPRC scandal was the biggest case of corruption in Maldivian history. Some US$80million was siphoned off in total through the state-owned tourism promotion firm.

The opposition continues to allege Yameen’s involvement in the unprecedented corruption scandal, but the president has sought to pin the blame solely on his jailed deputy.

Adeeb and two of his associates are standing trial over the MMPRC scandal. Earlier this month, the former vice president was handed a 15-year jail sentence over an alleged attempt to assassinate Yameen with a bomb on the presidential speedboat.