The Agony of Reform

Maldives embarked on ambitious political reforms, and adopted a new Constitution two years back. Under the new Constitution, we’ve been ensured separation of powers, with an ‘omnipotent’ Parliament, an independent Judiciary, and a ‘helpless’ Executive. The Constitution guarantees the citizens so many rights, so that the Courts cannot convict us so easily, as was a our current President convicted for stealing from Velaanaage.

An independent Civil Service Commission is formed, replacing the Public Service Division inside the President’s Office. There are five members with huge salaries heading this commission. Apart from this commission, there are many other commissions and institutions that were formed since then. Following is a list:

1. Human Rights Commission

2. Judicial Service Commission

3. Police Integrity Commission

4. Prosecutor General’s Office

5. Elections Commission

6. Anti-Corruption Commission

7. Employment Tribunal

8. Maldives Media Council

9. Maldives Inland Revenue Authority

10. Local Government Authority

11. The Supreme Court

Most of these commissions have at least five members, earning almost the same remuneration as a cabinet minister. The newly elected Parliament has 77 members, also earning a fortune. The Supreme Court – with 7 Judges!

We’re not done yet. Soon, there’ll be at least 5 Councilors governing every inhabited island. At least 5 Atoll Councilors in each atoll. In order to support the salaries of all these people, the civil servants, and the politicians, our country will be spending almost Rf5 billion every year, while the government revenue reaches almost only Rf7 billion! The situation gets worse with the increased number of political appointees, and the promises of the politicians to increase the salaries of the civil servants.

So, what have we achieved since the reforms began? I see, mostly ‘rent-seeking’ activities, whereby people in powerful positions and high bargaining power, trying to maximize their personal gains, and trying the control as many poor, helpless people in the society. The society has become so polarized, the objective of the people in the opposition being toppling the government at any cost, even if it means destroying the society at large.

On the macro front, the economy has become extremely vulnerable, and the country is spending about Rf 900 billion on imports of goods every month. When we take into account the outflow of dollars from Maldivians traveling abroad, and other expenditures, we are spending more than we earn, at every level of the economy. Meaning, the government expenditure is greater than its revenue. The dollar outflow is greater than the inflow. At the end of the day, the country is faced with a twin deficit – a budget deficit and a current account deficit. Meanwhile, the IMF has stated that Asia will be engine of growth in 2010 and 2011, with high economic growth in China, India, and other South East Asian economies. Our closest neighbor, Sri Lanka, expanded its economy by 8.5 percent in the three months to end June from a year earlier (Bloomberg). Its economy is expected to grow at 8 percent this year according to the Central Bank of Sri Lanka.

Bottom line is, we are paying a very high price for the reforms that we began few years ago. Hey, I’m not saying that we go back to the old days, or to amend the Constitution like the Sri Lankans did.