Maldives at a crossroads

Street protests, unruly mob violence, nightly raids and destructive slogans against the ruling party have put the first democratic government of Maldives in a vulnerable position. Dollar shortage for over a year resulted in a flourishing black market and economic instability. Recently, the government acknowledged that the local currency, Ruyffia was overvalued and a decision was taken by President Nasheed to devalue it. This was backed by IMF and the central bank. But, for a country almost totally reliant on imports for fuel and consumer goods, the costs of living for average Maldivians has exacerbated to almost 20%. It would have been prudent to devalue the currency incrementally over the last two years. But the current move was imperative to save the country from further disasters.

The high costs of living led to confrontation between the opposition and the ruling MDP parties. Since the opposition parties are going through internal strife with former President Gayoom forming a new ZDRP party yet unregistered, the devaluation of the currency has provided an opportune moment to protest against the government and create a smokescreen over their own political wrangling. They claim that the government is responsible for financial mismanagement and reckless spending without investing in productive resources. The youth are being used as pawns and the recent unrest has been termed by the opposition parties as youth movement reminiscent of political movements in the Middle East.

For their own vested interest opposition parties appear to have incredibly short memories. Most have forgotten that in 2008 the World Bank stated that Maldives was in a volatile economic situation. The budget deficit stood at 31% of the GDP, inflation at 12% and the economy was reeling from massive fiscal expansion with the government's wage bill increases. When President Nasheed came to power after the first multi-party democratic election, the World Bank noted that Nasheed had inherited the worst economic situation that any country faced since the 1950s.

Recently, after international media coverage of days of violent demonstration across the capital Male', countries that have tourists travelling to the Maldives have warned their citizens of security problems. Maldives was identified by Hong Kong as 'amber' after several nights of severe protests. This threat indicator now ranks the Maldives alongside Israel, Iran, Indonesia, Russia and Pakistan. China's Xinhua news agency reported a government spokesperson as saying that those who plan to visit the Maldives or are already there should "monitor the situation and exercise caution." Chinese tourist constitutes the largest number of arrivals and is a major emerging market. This increase in recent years has offset a decline in European tourism due to global recession of 2008.

Travel operators in Taiwan are also postponing and cancelling group bookings because of negative perceptions of safety. Representatives of Maldives tourism industry attending the Arabian Travel Market in Dubai, the regions largest such expo, claimed that cancellations are being made because of fears of security amid angry political rallies. Tourism is the largest dollar earner in the country and these cancellations will result in severe decrease in the country's foreign exchange earnings.

It is pertinent to mention here that the tourism industry of the country has been carefully engineered to avoid interaction between travelers and locals. Almost all tourist resorts are located in individual islands with little connection with the capital, Male'. Even the airport is on a separate island and it is perfectly natural for foreigners visiting Maldives to have no idea of the political background to their holiday. But, press coverage by international media has created a negative perception that will have adverse effects on the country's earnings.

The Foreign Minister of Maldives, Mr. Ahmed Naseem accused opposition parties of 'misleading' international media which has impacted on the country's lucrative tourist industry.

He further added that "People who organize such protests should take full responsibility for the images and disruption and damages to property caused." There was instant reaction from opposition DRP leader Thasmeen Ali who said he was "utterly surprised" that a member of the current government that has always stood for freedom of speech and democratic reforms, would find protests "unreasonable" on the basis of protecting tourism. He completely ignored the fact that tourism is the most profitable asset. To overlook it reveals a total disregard for the good of the country with an innate desire to discredit the ruling government at any cost.

Speaking at a rally, President Nasheed stated that the government's currency devaluation was backed by IMF and challenged the opposition to defeat him in an election rather than attempting to topple the government illegitimately.

Peaceful protests are legal but somehow many democratic countries are incapable of doing so due to lust for power and hidden grievances. A Government spokesperson in the Maldives stated "In the Middle East, you have democrats on the streets bringing down dictatorships. Ironically, in Maldives the parties of former dictatorship are trying to bring down democracy."

Mr. Robert Blake, the US Assistant Secretary of State visiting Maldives said that “Even in an older and more established democracies such as ours, politicians find it difficult to work together across party lines in a spirit of fairness and bipartisanship for the sake of governing well. But, when they do, everybody benefits.”

A dialogue was held a few days back by representatives of the government and party youth leaders. It was unsuccessful. The youth leaders demanded further reforms to reforms that have already been undertaken. To ask for the moon is a means of thwarting any useful dialogue.

It appears that the current unrestrained demonstrations are not merely against a rise in the costs of living but to bring the government of President Nasheed down. Such is the peril of democracy. (The Daily Star)