The government has decided to take over Gaaf Dhaal Kaadedhdhoo airport after offering a USD 18 million (MVR 277.5 million) compensation to Qasim Ibrahim's Villa Air.
The Economic Council reached a decision on August 14 and sent a letter to Qasim on August 19. The Villa Group's Chairman and Maamigili MP posted the letter on X on Friday.
The letter, signed by the Principal Secretary to the President on Corporate Development Mohamed Shahid, details the compensation for the airport.
Villa had demanded a compensation of USD 21 million for the airport, but the Economic Council decided on USD 18 million. The money will be paid in instalments of be deducted from taxes.
Economic Council's decision
- Pay the USD 18 million compensation over 18 months to avoid financial burden
- Deduction of compensation over 18 months from taxes payable by companies in the Villa Group
The government decided to cancel the airport agreement if Villa agrees to the conditions.
Villa has accepted the government's offer.
In a post on X, Qasim said he accepted the government's offer to give up the airport for USD 18 million "with full awareness of how profitable it can be once turned into an international airport."
According to the President's Office letter, an audit report from Ernst & Young puts the value of the airport at USD 18.5 million. It also estimates that the airport development will cost USD 100 million.
The airport was handed over to Villa Air in 2013 for 50 years. However, the agreement was canceled by the Civil Aviation Authority in 2017 amid political disputes between Qasim and then-President Abdulla Yameen.
In 2018, the Civil Court ruled that the government had terminated the agreement unlawfully. The decision was upheld by the High Court and the Supreme Court.
The airport was returned to Villa in 2022 during former President Ibrahim Mohamed Solih's administration.
The airport was handed over to Villa along with two lagoons. But the lagoons have remained undeveloped. With the cancellation of the airport agreement, the two lagoons will be handed back to the government.
