Remarks by President Mohamed Nasheed at the World Bank Maldives Country Management Retreat

Good morning Ladies and Gentlemen,

My government was elected on a platform of good governance and fiscal discipline. We campaigned as a centre-right party that wished to roll back the state and unlock the potential of our people.

We set about our task to reform the country after seeing how broken the system was; and knowing that we could do better.

Autocratic rule, breakdown of law and order, human rights abuses, and rampant corruption defined the era that preceded us.

The flourishing of democracy has brought with it a number of important innovations.

We have separation of powers- an independent judiciary with a Supreme Court at its apex.
For the first time in the country’s history we have a legislature that is fully elected, and with representation from the entire political spectrum.

A number of independent institutions such as the Anti-Corruption Commission, the Human Rights Commission, the Auditor General’s Office and the Elections Commission exist which keep the government in check.

A free media encompassing newspapers, news websites, and television and radio stations are ever vigilant.

However, as you know only too well, the true picture is far from rosy.

We inherited a nation on the verge of bankruptcy. The fiscal irresponsibility of our predecessors has left a big black hole in the treasury.

Civil service pay was hiked up as a means of patronage,

Commercial loans were taken to pay for infrastructure projects in the islands with the intention of buying votes,

Contracts were awarded for such projects with no financing secured and just left to drain the budget,

Over sixty resorts were tendered out in a thinly disguised auction, and the advance lease payments were used for consumption,

Furthermore, the exorbitant lease rents they were given out on have become more of a burden on the successful bidders and have not helped our economy,

State-owned enterprises are bleeding and in the instance of the electricity company, tariffs were reduced while fuel prices were going up.

Our debt, if the status quo was maintained, was set to shoot to over 30 percent of GDP. An unacceptable level.
Ladies and gentlemen.

These were not the actions of a prudent, responsible or competent government.

It is one of life’s great ironies that it falls to a government led by a party accused of being mere activists with little experience of governing, to put the house back in order.

It falls to us to act with responsibility and maturity; to make up for the shortcomings of the past.

But this is a challenge that we will rise to, and meet head on.

I did not seek this office to enjoy the perks or trappings of power, and neither did my colleagues.

We stood for election on the basis of a programme of far-reaching reform as outlined in our manifesto.

Our government came into power with a vision. We want to give people the opportunity to live a decent life. And we want to live within our means.

Our development plan is one that is both equitable and sustainable.

Anyone following developments in the Maldives will be more than familiar with our five pledges:

Bringing down the cost of living,

Providing affordable housing,

Setting up health insurance available for all,

Closing all doors to drugs, and

Laying down a nation-wide transportation system.

These pledges will be delivered within a sound economic framework.

As I am sure you will accept, we created history one year ago.

A homegrown democracy movement in a Muslim country took on a thirty-year old autocratic government with deep roots in society and the strong backing of the establishment; and emerged triumphant.

We have been lauded for this achievement, and that is well and good.

HOWEVER, the REAL revolution is the one we are about to institute. I am referring to the overhaul of our entire economic and social system.

Let me spell out our vision in very simple terms and how we intend to achieve it.

We aim to roll back the state and redefine its role from a provider of services, to a regulator and facilitator.

Our pledges will be delivered through public-private partnerships and the government will institute measures that attract greater investment; both from domestic and foreign sources.

We will take measures to diversify our economic base to create more jobs in the private sector.

A social safety net will be instituted to ensure that none of our citizens fall through the cracks and that the state will back up those who need assistance.

My colleagues will go into the details of our proposals in their presentations; but allow me to expand on these points.

The former regime maintained an unwieldy bureaucracy to prop up it up. Out of Rf. 7 billion earned in government revenue, the government wage bill accounts for Rf. 5 billion.

We aim to halve the total number of civil servants and ensure that only those necessary for the state to function effectively are retained.

A programme of corporatization and privatization has been launched and it covers (1) State-owned enterprises (such as STELCO, MWSC and MNSL), 2) Social services such as schools and hospitals, and 3) new corporate entities such as regional utility companies and the waste management company.

The introduction of the private sector will, in addition to alleviating the budgetary situation, also result in greater efficiency and better quality services.

We will diversify our economic base and introduce new products in fisheries, such as aquaculture and mariculture, and in the tourism. Guest houses, luxury villas and cultural tourism products will be introduced.

The Madhana social security programme currently covers 48,000 people and the number is set to double by the end of the year.

Those over 65 years of age are provided a state pension of Rf. 2000 per month.

The Human Resource Ministry has begun a Technical and Vocational Training Programme (TVET) to train 5,000 people for the job market.

Of course, we will consult with and seek your assistance in these endeavors.

We understand that the bank has limited IDA facilities for the Maldives.

However, $14 million is simply not enough.

I am confident that the bank will be able to contribute lavishly.

The point is not to focus on figures and to limit us to some artificially set benchmarks.
The focus should, rather, be on what needs to be achieved. On what needs to done.

I had a conversation with your Vice President for the South Asia Region on Friday evening. She agrees that it will be difficult, but she understands that we have a critical need.

We both agreed that it might be possible to go beyond the limits and to source more finances for our programme.

It would be a great shame if this were not possible.

Ladies and Gentlemen.

I am grateful and honored to have been invited to present our policies at this gathering.

I hope that we can come to a common understanding that would be of benefit to our people and give us an opportunity to sustain and strengthen this unique democracy we have here.

Once we complete this programme of action, we will be home and dry.

Thank you very much