1 - Hulhumalé and the Bridge

Development of Hulhumalé and Bridge Across the Channel                       

Memo to President Dr Waheed from Rifat Afeef
(The original memo was dated January 25, 2013)

The primary purpose of this memo is to comment on government plans to develop Hulhumalé as a full-fledged satellite of Malé and build a connecting bridge.  Both these plans will be extremely damaging to the future of this nation.  Discussed below are the reasons for this statement. 

[Before reading any further, I suggest that you read Appendix first: it explains some basics of development and related issues about which the majority of people (in particular those with related degrees and who consider themselves knowledgeable of the topic) have a rather confused perception.  I would thus emphasize that Appendix is in a way equally important as the body of the memo itself, since without a sound understanding of the basics of the topic, which are treated in it in simple terms, efforts to understand the full and long-term implications of this memo is unlikely to yield its full benefits.] 

Regarding the development of Hulhumalé as a full-fledged satellite of Malé, we have to take account of important strategic aspects seemingly unrelated to Hulhumalé itself.  Our development is dependent on foreign currency, the sources of which, at the moment, are only tourism and fisheries.  And contrary to popular belief, these two industries could be expanded only to a limited extent, in spite of there being many islands suitable for such development and our having an EEZ of 90,000 square kilometres. 

There are a number of important aspects that need be considered in this regard – among them: i) the job opportunities available in the economy both currently and in the foreseeable future (at least 50% of them are now low-skilled and would be thus in the near future); ii) the lack of interest of GCE holders to work in such low-skilled jobs, and rightly so (please refer to the appendix of the attached article for detail, and my article labelled “Education Curriculum, More Effective” for further detail – the latter emailed to you in mid-2010); and iii) the long-term devastating impacts of the above two factors.  (Just like an ill functioning organ of the human body will adversely affect the whole body, a dis-eased part of the economy will adversely affect the whole economy and therefore the wellbeing of the entire nation.) 

Thus we are in great need to find: i) new sources for generating foreign currency, and ii) the kind of jobs that are more appealing to young people with GCE.  (The latter will help to get the youth off the streets, not to mention drugs, and will pay handsome dividends from both the social and economic standpoints.) 

The development of Hulhumalé as a light industry complex (relying on the competitive advantage that may accrue from that development due to both the airport and Hulhumalé being on the same land mass and close together and both being close by to Malé, the only large urban centre in the Maldives for the foreseeable future) will go a long way to achieve the two objectives identified above, namely, generating foreign currency and adding semiskilled job opportunities to the economy, both in significant numbers.  And to do so effectively, the bulk of the area has to be assigned for this purpose.  For several reasons, no other area in the nation currently has the potential to be developed to achieve those outcomes.  

It is thus clear that the currently envisaged development of Hulhumalé as an extension of Malé will permanently jeopardize the opportunity we have now to diversify our economy.  There are other areas that can be reclaimed and developed for that purpose.  Embudu Finolhu, for example, is large and about the same distance from Malé as is Hulhumalé (although it is across the Vaadhoo channel – but given the damaging potential of the envisaged bridge (see below) this is not a relevant factor) and could be easily and feasibly developed for the purpose, leaving Hulhumalé to be developed to its full potential.  

[The idea of reclaiming Hulhulé-Farukolhufushi reef (now called “Hulhumalé”) was officially proposed to the government in 1983 by OPPD in an annex of the report for developing Guraabu Thundi for Malé International Harbour, which was then located where Jumhoori Maidhaan is now and lacked the scope for expansion.  Delegating this to an annex was not due to its lack of importance but because it was not part of the Terms of Reference of the consultant who undertook the task, and which itself was part of a larger UNDP funded and UNCHS supported project to develop Malé Capital Region, and which was run under my direction.  (The design of Malé roads was a second successful subproject; it was meant to be an experimental design and yet was implemented over 30 years with hardly any improvement!)] 

A second vital aspect (following the designation of Hulhumalé for the purpose mentioned) is with whom we should partner to develop the area, since we cannot do it alone.  This is a critically important issue, not only due to the difference it can make for specifics of the project itself, but more importantly, due to the difference it would make in the long-term positive spill-off into the development of the entire nation; this can be viewed as huge positive externality.  If handled with insight and correctly, the endeavour has potential to accrue enormous benefits and may even change our whole outlook on development itself. 

[Unfortunately, the reach of the mind of those sitting behind desks in high office and have a decisive say in such important matters do not go beyond immediate concerns; interconnectedness of the economy and impacts arising thereof are beyond their comprehension.  (It was precisely this issue that was dealt with in the attached article "Viyafaari U'sool.")  Their thinking is limited to theories they have studied at college and do not realize that there is a lot more to theories in the real/practical world.  They mostly hear people talk of “commercialization” and “foreign investment” and have no awareness that those phrases represent only one side of the coin.  This is not to say that theories are wrong; only that they are just that: theories, which are simplified versions of reality, not reality itself.  Thus while they might know an architectural model, for example, is not a real building, they don’t seem to understand that the economic models they study at college are not the real thing either, but just as abstract concepts of some reality.] 

Returning to the topic at hand, I am particularly concerned about who would partner with us to develop Hulhumalé, in particular since I heard that a Turkish company may have been chosen for the job.  (When I heard the news, my immediate reaction was: “Oh my God, What kind of idiots are those taking these decisions!”)  And if there is corruption involved – that someone is getting a cut from the deal – I urge you to intervene decisively before it is too late, before a greedy official sitting behind a desk jeopardizes our future potential!  It is commendable that the Indians have been gotten rid of, if they have been gotten rid of; for they form the biggest threat to this nation (see the attached article labelled "Viyafaari U'sool" which treats the topic in detail).   But a smaller blunder by comparison is still a blunder and an expensive one at that, and is not excusable, even if going with Turks is unlikely to threaten our long-term future, which is the case with the Indians.   

The question thus becomes, whom should we take as partners for the development of Hulhumalé.  To my mind, one nation stands out when our long-term strategic goals are taken into account and the project viewed from a long-term perspective, and that nation is Singapore.  Sometime before the former government decided to give the airport to GMR, I met the official in charge of its technical aspects, and when I protested giving the airport to GMR and put forth my argument to get the Singaporeans in, his answer was that they did not respond to the international tender put forth for the purpose!  He had no clue that people do not call for any tenders, international or otherwise, regarding crucial strategic assets such as a nation’s international airport; such an endeavour calls for dialogue at the high-levels of the government! 

I believe that Singapore had a keen desire for active cooperation with us more than 30 years ago, when Mr Gayyoom visited there in 1982.  Unfortunately, he had no notion of such long term thinking; all he did was put forth a begging bowl seeking free handouts!  (This was the same behaviour he had while a graduate student in Cairo in the late 1960s; it may be the correct behaviour at the time, but he could not comprehend the fact that he was now the head of state of a nation and not merely a student!)  30 years is a long time and Singapore has made gigantic strides on the development path, and it might no longer be interested in the Maldives.  But it is worth a try.  And if it does, we would be very lucky indeed! 

It should be kept in mind that the development of Hulhulé-Hulhumalé is long-term strategic concern and involves long term and vital interests of both nations.  It is not just a commercial project and should not be treated as such.  And the issue should be discussed at the highest levels, and not via some tender! 

There are several reasons why Singapore is the ideal candidate for the purpose and Turkey (or any other nation) is not.  Again, looking at the process from the long-term standpoint, Singapore can help us in our development process on multiple fronts, not just with regard to the development of Hulhulé-Hulhumalé alone.  This has multiple aspects: i) technical know-how; ii) financial prowess; iii) transparency and lack of corruption; and iv) long-term relations.  On all these and other fronts, Singapore has overwhelming advantages over a nation like Turkey, which is basically a Third World country unable to cope with its own problems, which are plenty.  As explained, development of the area to achieve the goals identified above mandates taking account of the multiple ways in which the project will affect long-term development of the whole nation.  Envisaged is a development project, not a commercial one.  (See Appendix for the fundamental difference between development projects undertaken by a nation and commercial projects undertaken by a corporation; their goals are decisively and definitely not the same.) 

Finally, it will be a mistake to think that current ills of Malé could be tamed by designating Hulhumalé a suburb of Malé.  This was the same kind of thinking the government had in the mid-1980s regarding the overcrowding of Malé – it embraced the concept of population control, ignoring saner and far-thinking voices that argued that we are a small economy and development requires a large population; that population cannot be increased at will after it has declined.  30 years later, we are now burdened with the disastrous results of that short-term thinking!  Likewise, current problems will not go away by making Hulhumalé a residential suburb of Malé!  In fact, it will make things worse, since it will act as a bigger magnet and will draw more people from the rest of the nation in increasing numbers as long as the rest of the nation remains in a deprived state.  Easing pressure on Malé therefore requires the development of the rest of the nation at an accelerated pace.  Crucially, there is a right way of going about such development and many wrong ways; the latter will largely drain scarce resources while exacerbating the original problem.

Regarding the building of a bridge from Malé to Hulhulé, again we have to think long-term and not be preoccupied merely with solving immediate problems.  Let us take a look at the current situation of the built-environment in Malé, which trend is likely to continue into the future and at an accelerated pace.  The whole island is being built up, leaving merely the 20% taken up by the roads and just a handful of open spaces.  And this build-up is happening in a most alarming way: multistory structures are being stacked up adjacent to each other with hardly scope for proper air circulation in the city as a whole.  The island is already congested with motor vehicles, having happened over a relatively short period of time.  Exhaust fumes emitted by the variety of motor vehicles (which include numerous poisonous gases such as carbon monoxide and dioxide, and oxides of nitrogen and sulfur, not to mention heavy metals such as lead, which have long-term retarding effects on children’s brain development) has already made the general environment unhealthy to live.  This is the condition of the most essential element for us to be alive: the air we breathe.  Further, one can hardly find a parking place on the congested roads of Malé, and simply moving about on them has become dangerous to life and limb.  This is just a brief description of the aggravated current situation, which evolved over the relatively short period of 10 - 15 years.  The current trend will continue, and will become increasingly worse over the coming years.  No amount of tree planting can counter this increasingly hazardous and congested built-environment. 

Now, what will happen if a bridge is built?  Pressure to own motor vehicles, particularly four wheeled types will increase by leaps and bounds.  Cars, and even motor cycles, are symbols of prestige for most people, not merely a means of transportation.  (This is the case in developed nations as well, though to a lesser extent in relative terms.)  Given people’s self-image and a mindset of comparing themselves with others (this situation will worsen at an increasing pace over time as they see more people having better symbols of prestige) a bridge across the channel will be much like adding petrol to a smoldering fire.  There are those who think that all ills can be solved with more regulations.  They do not want to learn from past mistakes, and they forget the dynamic nature of the world we live in today – under the best current conditions, more regulations will get them kicked out of office! (And they can’t comprehend that opinions of those who know are not equal to those of who do not!  Even The Koran says so, explicitly!)  

It is amazing that those who talk of building bridges don’t have a presence of mind to see the situation around them right now; it does not need a leap of imagination to see what will happen in the very near future.  Thus there is good reason to wonder if they are insane not to grasp the results their actions will bring!  Individuals think about themselves and cannot be blamed for wanting comforts they perceive as desirable.  Who would not want to own a car and take the family for a drive over the bridge across the channel?  It is the role of the Government to foresee these trends and guide people in the right direction.  Instead, it is acting most irresponsibly – by planning to lead people over a bridge to their own graves! 

Appendix

As stated at the outset, understanding some of the basic concepts related to development is necessary to be able to fully understand this memo and many other aspects of everyday life; it will also allow one to meaningfully participate in many social forums – whether in informal conversations on issues or formal decision making – while enabling to weed out much of the BS we hear in such forums and hence avoid being simply misled or persuaded to lend support to or take part in making the wrong kind of decisions. 

We shall begin at the very beginning and proceed step by step, and define development simply as “the continued improvement in the access to the necessities of life, in addition to a better state of the natural and human-made environments and the scope for meaningful participation in one’s political culture.” 

And to simplify matters and outline basic principles, we shall limit our discussion to the italicized part of this definition, namely, access to the necessities of life.  (In reality, without this part being fulfilled, the remaining part will not be of much value – for example, someone who is starving or homeless will not be in a position to care much about one’s environment or be involved in any political culture.) 

“Access to necessities of life” in its turn has two sides to it: having money to buy them and their being available to buy.  These two aspects are intrinsically entwined, and (basic) development happens to the extent that those two conditions are fulfilled.  Let us take the second aspect first – availability.

Availability of goods and services to the general public happens when someone provides them, and that someone is usually the private sector.  Now, the primary motivator for the private sector is profit.  There is nothing wrong with this; selling what one can produce best (be it a good like the kind available in any shop or a service like the expertise of a physician) at a profit and buying with the money gained one’s all other necessities is the norm on which all modern economies function.  We can conclude that it is due to a well-functioning private sector that people are able to access goods and services they desire – which is one aspect arising from our definition of “development.”  The other aspect arising from this definition or money, or jobs through which money is earned, happens when the private sector functions properly and provision happens – since provision leads to employment or earnings.  And to simplify the description of the development process, we shall limit our discussion here, once again, to the provision aspect alone.  Naturally, the right policies by the government will enhance both aspects and facilitate development. 

It is obvious that if there is no scope for profit, there will not be a significant private sector to provide the goods and services that people need, in particular their more advanced kind.  Such is the case in the outlying atolls of the Maldives, as people don't have sufficient buying power, meaning money to spend, and as populations are small and lack sufficient mass to generate scale economies.  And since the people do not have access to goods and services, even the most basic ones, they are labelled “undeveloped.”

It is clear that if people in such undeveloped areas are to have access to even their basic necessities, then someone must provide them, and not on a “commercial” basis.  This someone is the government in most cases.  Recall our early schools (Majeediyya and Ameeniyya) and health services (Central Hospital – now ADK); they were financed solely from the government's budget and people had access (although limited spatially) to those respective basic necessities.  In the relatively developed Malé now, the government can gradually minimize its role in those areas where the private sector can function in a self-supporting manner, and that is precisely what today's picture shows.  But this is not the case in the outer lying areas, and the government has to play an active role if people in those areas are to have basic necessities.  (And to do so requires organizations like STO, MTCC, and BML, even at a loss commercially – as their basic mandate is more important.)  But given that the government cannot, and should not, go on doing this for ever, forced development of those areas becomes necessary.  Thus adopting right policies to rectify this deficiency and converting those areas that cannot support a well-functioning private sector to areas that can is the primary purpose of development policy – while temporarily taking the slack or filling the void arising from the lack of a well-functioning private sector.  It is clear that the perception people have about government intervention as efforts to cater people freely and indefinitely is a most misguided one.  Unfortunately, our current efforts are more like Yehya's behaviour than sensible and consistent policy – as they are not based on any sound theoretical understanding of the dynamics of the processes involved. 

The above is sufficient to show that mere “commercialization” without any thought to the complexities involved will create more problems than they solve (not to mention the suffering that such blind policy will produce) and that those who trump such dogma do not know what the hell they are talking about!  

The discussion above also makes the primary role of public enterprises abundantly clear.  The fact that such enterprises have a profit-making role is a secondary concern, though it may be an important one.  This importance arises not so much from its contribution to the government’s budget as from the fact that the government, already burdened with numerous demands, cannot continue to support them in their basic and mandated roles indefinitely.  Therefore making profit where they can is important to the extent that they can cross-subsidize and work in those areas where they cannot make a profit without burdening the government.  We saw above that this is necessary for the development of the rest of the economy.  It is well and good if they can make contributions to the government’s budget (which would help ease the burden on it due to the demands from other sectors) but the basic mandate of such public enterprises or the very purpose for which they were established in the first place should not be compromised. 

Unfortunately, this broad and important purpose of public enterprises is lost on most people, including those in government high office.  To their limited thinking, especially those who return with degrees in related fields from abroad fresh from universities (where such differences are usually not taught) public enterprises that do not make a profit have to be scraped!  Inexperienced young people who return with such degrees and are appointed for one reason or another as CEOs of those very enterprises have the same ignorant attitude!  It was not once or twice that I saw them proclaim on TV that the most important goal of the enterprises they head is increasing shareholder value, which boils down to maximizing profit.  (I believe that such people should be removed from those jobs regardless of what advanced degrees they may have or what political connections; they can cool their heels somewhere else until they gain enough experience or, more importantly, clarity of understanding of the purpose of those enterprises.)  This is not to say that bureaucracy and inefficiency, not to mention corruption, are to be tolerated, though we know that these characteristics are often associated with them.  In my opinion, such deficiencies do not arise from the inappropriateness of their basic mandates but from mismanagement; the lack of clarity of goals being a crucial reason for such mismanagement.  This in its turn arises from the fact that such guidance should have come from the government agency mandated for that purpose, but which agency itself is so confused about its own role in the national economy that it cannot even guide itself, let alone be able to guide someone else to the right path!  (See my 1998 memo labelled “Plan’g Min Role Redirection.”) 

We can see from the above discussion that there is a crucial difference between public enterprises and their commercial cousins – the primary goal of public enterprises is not just profit making above all else, whereas it is the basic purpose of commercial enterprises.  As would be clear, there is nothing wrong with profit maximization; it would also be clear that it is a well-functioning private sector that is responsible for what we call “development.”  It is, however, important to remember that there is a certain path that should be taken before an undeveloped nation can transform itself into a developed one.  Those who have studied only theories in institutions of higher education and lack the relevant knowledge and experience ought to know that this has been the most crucial factor for those nations that we now call “developed.”  For example, World War II had decimated virtually all European industries and it was the establishment of government funded, and run, public enterprises that helped those nations to get on their feet.  In the USA, it was the construction of interstate highways that enabled it to grow and be the world leader, and they were federally funded and maintained, even now!  The four East Asian “Tigers” – South Korea, Taiwan, Hong Kong, and Singapore – did not grow and catapult to world fame by relying solely on the private sector; their private industries were heavily subsidized and/or otherwise supported by their governments.  Even corporations like Airbus and Boeing (regardless of what the latter claims about its free market practices) are subsidized by huge research grants and defence contracts.  And yet while those who come with degrees fresh from universities talk loud about corporations, they do not seem to have a clue about how the real world works but keep making ignorant statements and misleading others!  

In sum, public enterprises in developing nations cannot be judged by the same standards used to judge private corporations in advanced nations; methodology of the latter cannot be applied arbitrarily to the former.  In similar vein, the primary goal of public projects in developing nations is to get the entire nation to grow, not merely to make profit; they should be viewed accordingly and not through another viewfinder.