NIPG SME Program Part 1 by Chris Marshall

NIPG Partnership Program Enterprise Development Focusing on NIP SMEs

NEW IRELAND PROVINCE Developing Rural Community Business Enterprises

Deep-water snapper landings (kg) by RCFDP vessels at ASL by month: October 2004–July 2005 (Source: Kinch, 2005) ssel 1 Vessel 2 Vessel 3 Vessel 4 Vessel 5 Vessel 6 Vessel 7 Total 327.0 282.0 423.0 395.0 1427.0 304.0 612.0 748.0 807.0 2471.0 576.4 249.4 696.9 1269.2 2791.9 119.0 398.2 28.0 95.4 640.6 203.6 267.0 807.5 95.2 1373.3 87.0 273.0 922.6 1282.6 579.0 930.5 642.5 2152.0 557.2 1037.5 687.0 40.0 2321.7 177.3 333.0 89.0 221.0 674.8 173.5 1668.6 683.0 644.0 25.0 261.0 1011.0 140.0 563.0 3327.0 2947.5 4489.1 114.0 482.0 6279.7 313.5 4829.9 19,455.7

ivate fishing companies involved in the fishing for deepwater red selves as well purchasing from other fishermen. Altogether they make an ding of 850 kg per month (Kinch, 2005).

2: Catches from the EU RCFDP dories being sorted at the ASL plant

scale, Kavieng fishermen are involved in the fishery. Fishing is not full time but nearly always at the subsistent level driven by demand, ed cash the fishermen go out to fish the more valuable deepwater and es and sell to supplement their income. There are only a few deepwater ainly from Emirau Island living in Kavieng) who fish for income on a

ishing however is being developed gradually with better pricing and the f a market that consistently buys deep-water fish. A number of trainings r fishing, as well as post-harvest training carried out by NFC with m the Secretariat of the Pacific Community (SPC) has further o the development of the fishery. Over 50 people have been trained Chapman, 2001), although not all of them are involved in deep-sea s stage. 5

SME Developers Ltd

February 2014

NIP SME Business Enterprise Development

• Business planning • Business growth • Integrated training

• Regional focus • Community hubs • Local employment

• Web-‐based platform • Market linkages • Buyer connections

SUSTAINABLE BUSINESSES

TRADE PLATFORM

VALUE-‐ ADDING

MARKET DATA • Regional markets • Global markets • Better enterprise planning

Special focus on rural community enterprise developments

A consortium of Integrated Training & Development Consultancy Ltd, Gore Accountants & Business Advisors Ltd, Deeken Research & Strategy Ltd, Brikham Business Consulting Ltd and Kaltane Pty Ltd

NIP SME Business Enterprise Development

Table of Contents NIP FISHERIES

BACKGROUND & JUSTIFICATION NIP FISHERIES-‐BASED OPPORTUNITIES SECTOR CATEGORIES NIP FISHERIES-‐BASED PROGRAM STRATEGIC PROGRAM APPROACH PROGRAM MANAGEMENT APPENDIX A: NIP FISHERIES PROGRAM

1 3 3 6 6 7 9

NIP TOURISM

BACKGROUND & JUSTIFICATION NIP TOURISM-‐BASED OPPORTUNITIES SECTOR CATEGORIES NIP TOURISM-‐BASED PROGRAM INDICATIVE IMPLEMENTATION APPENDIX B: NIP TOURISM PROGRAM

10 12 12 15 15 17

NIP AGRICULTURE

BACKGROUND & JUSTIFICATION NIP AGRICULTURE-‐BASED OPPORTUNITIES SECTOR CATEGORIES NIP AGRICULTURE-‐BASED PROGRAM STRATEGIC PROGRAM APPROACH INDICATIVE IMPLEMENTATION APPENDIX C: NIP AGRICULTURE PROGRAM

18 20 20 20 20 21 24

NIP COMMUNITY-‐BASED FORESTRY

BACKGROUND & JUSTIFICATION NIP COMMUNITY-‐BASED FORESTRY OPPORTUNITIES SECTOR CATEGORIES NIP COMMUNITY-‐BASED FORESTRY PROGRAM INDICATIVE IMPLEMENTATION APPENDIX D: NIP FORESTRY PROGRAM CONTACT DETAILS

25 27 27 28 28 30 31

iii

NIP SME Business Enterprise Development

FISHERY MANAGEMENT AND DEVELOPMENT PROJECTS IN PAPUA NEW GUINEA COASTAL NIP FISHERIES SPC Indian Ocean design. The ship Council certification for the management of coastal fisheries FADs were deployed at least 10 fishery as part of its long-term in order to ensure the sustainabilmiles off the coast, and it plan to expand into export mar- ity of economic benefits that ` PNG derives from its fishery appears that in Madang they are kets for high-quality fish. resources. The focus is to work in used more by local sports fishNew I reland P rovince ( NIP) i s o ne o f f our m ajor fisheries-‐ based economies in PNG with a three of the same areas as the ermen than project fishermen at Coastal Fisheries 2 RCFDP (Alotau, Kavieng length and present, Lae the Management total awhereas rea of sinea covering 230,000 kand m and with a total shoreline estimated to be Lae), to complement the work of FADs are used more by the proj- Development Project around 1,334 km. has been estimated that NIP sustainably around 7,000 thiscan project and maximiseharvest the ect fishermen. Several of It the FAD have been lost. The Coastal Fisheries Manage- benefits from both projects in tonnes of average fisheries c atch p er a nnum f rom a t otal r eef a rea o f 6 00,000 hectares (1.5 ment and Development Project these area. The CFMDP is based Future plans for the RCFDP (CFMDP) is an Asian Develop- at the National Fisheries College million a cres). include an additional three ves- ment Bank (ADB)-funded proj- (NFC) in Kavieng, with initial sels being constructed at pres- ect that commenced in August work being conducted in the ent, with these to be delivered 2003 and will run until mid- New Ireland Province. Although fishing ineffort as iThe ncreased especially around Kavieng and Namatanai LLG areas, to successful applicants Lae. h 2007. project will work in There aresfour strategicsareas in like groupers and Another tensvessels are planned four in provincial locations, overall tocks a re a dequate w orld t erms. H owever pecialty pecies for construction in 2005 for the Alotau, Daru, Kavieng and Lae. the fisheries management support and capacity building comproject, and h from are two components snappers ave mid-2005 declined There around these urban tocenters. boats will be provided through the project, infrastructure devel- ponent of the project: institu credit fund as direct pur- opment, and fisheries manage- tional strengthening for coastal the chases. Local fish markets will ment support and capacity fisheries management; coastal The province also contains one of the major breeding grounds for tuna in the South Pacific be constructed in Kavieng and building. Under the infrastruc- fisheries assessment and moniinformaBuka, and probably extended ture component, the project is toring; region and has been tonoted as a potential location for strengthening expansion of the burgeoning tuna Lae and Daru, while processing constructing a tuna fishing tion flows; and communityindustry n P NG. NIPG as also een the jetty recipient of fisheries two fisheries development programs: development facilities will ibe constructed or hwharf and bsmall-boat in based upgraded in Lae and Madang Lae, a small-boat jetty in Daru, a and management. The activity under the major loan scheme. small-boat jetty and associated areas and work undertaken to The deep-water snapper fishing on-shore facilities in Alotau, date come under four headings, • Coastal Fisheries Management and Development Project (CFMDP)– Funded through part of the project will also be Milne Bay, and a fisheries as follows: expanded tothe take A inusAid/ADB the other research on Nago Island the required fisheries infrastructure including this pfacility roject delivered project locations in 2005. in New Ireland Province. 1. Institutional strengthening a commercial wInfrastructure harf along towsupport ith ice the making nd fish processing foracoastal fisheries manage- facilities (2004-‐2007). The project is also developing development of domestic fishment resource-use plans for Madang eries in Kavieng (Figure 6) is in and Lae, closely with Fisheries place as a result of a previous Project This includes: • working Rural Coastal Development (RCFDP)-‐ Funded through the EU this the Coastal Fisheries Manage- ADB-funded fisheries development and Development Project. in this area. ment project training courses on ffishery • project developed the deep sea (red snapper) fisheries or NIP including the The RCFDP in concentrating on management for individuals introduction suitable oats (dories) gear via loan schemes. The project also the management of the deep-of The aim of thebfisheries manage- and from government, NGO and water snapper fishery and is ment support and capacity buildstakeholder organisations; established f isherman a ssociations a nd o ther s tructural i mprovements. (2004-‐2005). looking into Marine Steward- ing component is to improve the • refinement of fishery legislation to support local level fishery management; • formation of stakeholder associations; • formation of provincial Fishery Advisory Committees; and • development of provincial fishery action plans.

BACKGROUND & JUSTIFICATION

Figure 6: Wharf complex in Kavieng funded by ADB in 2002 Linking to Key Agencies

A refresher course for New Ireland Provincial Fisheries Officers, Fisheries Observers, Port Samplers and NGOs was conducted at the NFC. This course focused on computer use, fish quality and hygiene, sea safety and small business

Fisheries Newsletter #110 – July/September Kavieng provides the base for this fSPC isheries processing facility b2004 uilt 35 through the CFMDP and operated by the Institute for Sustainable Marine Resources (National Fisheries College). This is in turn part of the National Fisheries Agency (NFA) and the College provides an essential component to the PNG fisheries sector through training and research programs. There is a direct link between the funded processing facility and fisheries development as the facility is leased by a leading seafood buyer/exporter, who in turn has established a network of local fisherman operators who supply this buyer in Kavieng.

Beyond this there is some degree of NGO involvement in the management of NIP fisheries through the rural communities and the Wildlife Conservation Society (WCS) in Kavieng. The WCS links with another NPO Ailan Awareness and Nui Ailan Surf Alliance in forming a community oriented fisheries observation and liaison network.

NIP SME Business Enterprise Development

Recognising that NIP community based fisheries operates through multiple actors from all these sectors (rural communities, private sector, NGO’s, public institutions and GO’s), our SME Fisheries Program component will integrate with these key actors in the implementation of NIP rural fisheries enterprise development objectives. Under our ‘Thematic-‐Sustainable Business Models’ we will provide effective business feasibility planning to support financing for rural community enterprises through banks and MFI’s (SME Stimulus); we will liaise through NIP LLG’s in planning for rural community economic developments; overall our program will support broader economic inclusion of both NIP rural communities and NIPG through NIBC (NIP semi-‐autonomy) and we aim to align through NGO’s and non-‐profits to integrate for community development and resource management:

GO’s: New Ireland Provincial Government (NIPG) Office of Economic Development New Ireland Business Corporation (NIBC) Murat Rural LLG Lavongai Rural LLG Kavieng Urban LLG Tikana Rural LLG Sentral Niu Ailan Rural LLG Namatanai Rural LLG Nimamar Rural LLG Tanir Rural LLG Konoagil Rural LLG PNG National Fisheries Authority (NFA) Institute for Sustainable Marine Resources (National Fisheries College) Fisheries Management Monitoring Control and Surveillance Licensing and Data Management Provincial Support and Industry Development Business Group Policy and Project Management NGO’s (NIP) New Ireland Indigenous Business Council (NIIBC) Ailan Awareness Niu Ailan Surf Alliance Industry (NIP) PNG National Development Bank (PNGNDB) Microfinance Institutions (MFI’s) Rural Development Banks Ailen Seafood’s? Other seafood buyers/exporters Logistics providers (sea/air)

NIP SME Business Enterprise Development

NIP FISHERIES-‐BASED OPPORTUNITIES

Table 2: Deep-water snapper landings (kg) by RCFDP vessels at ASL by month: October 2004–July 2005 (Source: Kinch, 2005) Month Vessel 1 Vessel 2 Vessel 3 Vessel 4 Vessel 5 Vessel 6 Vessel 7 Total Oct-04 327.0 282.0 423.0 395.0 1427.0 Nov-04 304.0 612.0 748.0 807.0 2471.0 Dec-04 576.4 249.4 696.9 1269.2 2791.9 Jan-05 119.0 398.2 28.0 95.4 640.6 Feb-05 203.6 267.0 807.5 95.2 1373.3 Mar-05 87.0 273.0 922.6 1282.6 Apr-05 579.0 930.5 642.5 2152.0 May-05 557.2 1037.5 687.0 40.0 2321.7 Jun-05 177.3 333.0 89.0 221.0 674.8 173.5 1668.6 MANAGEMENT DEVELOPMENT PROJECTS Jul-05 AND 683.0 644.0 25.0 261.0IN PAPUA 1011.0 NEW 140.0 GUINEA 563.0 3327.0 Total 2947.5 4489.1 114.0 482.0 6279.7 313.5 4829.9 19,455.7

Sector categories

Deep-‐sea fisheries have been reinforced as an emerging fisheries opportunity for NIP rural

COASTAL FISHERY

cylinder, 47-HP Yamaha ME200 diesel engine. Between the engine room and the cabin is a fixed fibreglass ice or fish hold with an internal capacity of 1.4 m3. The fish hold has a removable baffle, with the baffle used to reduce movement when fish are packed in an ice slurry. The vessel comes equipped with four Samoan handreels with line and hooks etc, two 500-m droplines, grapnel anchor and 440 m of anchor rope, trolling lines and a full set of sea safety equipment (life jackets, flares etc). The cost of the complete vessel and gear is PGK 133,000 (approx. USD 44,300) and is the “starter package” for fishermen identified and supported under the project.

The project has three loan schemes, one for fishermen who are members of fishing associations (micro credit scheme) for upgrading existing boats and fishing equipment, one for the fish processing sector (major loan scheme), such as private sector partners (PSPs), and the other for fishermen to purchase the project design vessel (starter package loan). The major loan scheme for the PSPs and processing sector is commercial loans provided through a local funding institution at a negotiated interest rate, generally just below the market rate, as the loan is guaranteed by the project. Under this scheme, one processing facility has been built in Madang and two others are to be upgraded in Lae and Kavieng, with others to come as appropriate applicants are identified in other project locations.

communities through the NGO (AusAid/ADB/EU) infrastructure and other implementations. By definition this category refers to bottom or near-‐bottom finfish including snappers, Two other private fishing involved in the for deepwater redlive in depths ranging from 80– 360 m. emperors, cods aAnd gfishing roupers revolving fundthat has been The loan schemejacks, forcompanies fishermen snapper themselves as well purchasing from other fishermen. Altogether they make an established under a central fund for the “starter pack” (boat and estimated landing of 850 kg per month (Kinch, 2005). fishing gear as described above) for this scheme. However, fishis free of interest and is given over a three- to five-year period.

ermen that qualify for the loan have to put up a PGK 500 bond

Figure 2: Catches from the EU RCFDP dories being sorted at the ASL plant

Resourcing Although this pursuit will require open ocean-‐going boats (dories) and associated training and equipment/gear, this gradually category represents opportunities to a wide range of island-‐based Deep-water fishing however is being developed with better pricing and the availability of a market that consistently buys deep-water fish. A number of trainings rural c ommunities i n N IP ( see A ppendix A ). A p riority for our support to this category will be on deep-water fishing, as well as post-harvest training carried out by NFC with assistance from the Secretariat of the Pacific Community (SPC) has further to examine the lofoan scheme (RCFDP) or resourcing of open water boats (e.g. dories) and contributed to the development the fishery. Over 50 people have beenftrained (Sokimi and Chapman, 2001), although not all of them are involved in deep-sea fishing g ear, t o e nsure w e a re a ble t o s tructure the most sustainable financing option fishing at this stage. through agencies (PNGNDB, M FI’s e tc.). This was identified as one area of project challenge 5 for the fishing clients. This process will be central to our business planning and resourcing component for all fisheries. Another commercial opportunity to adoption of deep-‐sea fishing is the requirement for equipment and materials (ice, eskies etc.) and through our enterprise development component, we propose to undertake feasibility planning for suitable rural communities to establish enterprises to service this demand. On a smaller scale, Kavieng fishermen are involved in the fishery. Fishing is not always done full time but nearly always at the subsistent level driven by demand, when they need cash the fishermen go out to fish the more valuable deepwater and pelagic species and sell to supplement their income. There are only a few deepwater fishermen (mainly from Emirau Island living in Kavieng) who fish for income on a regular basis.

Figure 2 (top): Vessel design used in the 1990s for deepwater snapper fishery development Figure 3 (middle): New ELA 82 design vessels at Kavieng Figure 4 (bottom): Fishing layout of the new ELA 82 vessel

Market channels SPC Fisheries Newsletter #110 – July/September 2004 33 The creation of the wharf and processing infrastructure has created an enabling market environment for deep-‐sea based fisheries with a large buyer/exporter and on this basis our SME Program proposes to include this category as high priority. Fisherman in turn have been found to make direct purchases through other local area fishers in order to increase their daily quotas. This has created a supply chain for deep-‐sea (backward integration) and provides for leverage of the economic benefits:

NIP SME Business Enterprise Development

Current (NIP) deep-‐sea fishery market structure: Sells&to&importers&or&local&businesses

Large&buyer/exporter.(via&leased& processingfacilities&in&Kavieng)

Local&(Kavieng.based) deep.sea&fishers

Local&area&fishers

(supply&to&lease.owners) (supply&to&lease.owners) Consistent with our strategic program approach our aim will be to investigate and propose options for greater economic inclusion of rural fisheries based enterprises through supply chain re-‐designs including integrating community harvests through cooperatives (Majestic Seafoods, Johnston has also been talking to local governments around the country to set up co-‐operatives to bring coral and reef fish from places like Kavieng or Manus to Lae for on-‐ selling) and consolidation of fisheries in Kavieng (through the PPP), to supply export and other commercial sale channels:

Proposed (NIP rural communities) supply chain: IMPORTER

LOCAL& TRADE

LOCAL& BUYER

Fisheries&cooperatives/supply&chain& developments&(PPP's:NIBC)

Rural&based&NIP& communities

Local&area&fishers&(supply& to&licence&holders)

Beche-‐De-‐Mere fisheries is an attractive option for most NIP rural communities due to simplistic harvest process and therefore will be proposed through our SME Program, as a suitable economic enterprise to adopt for our clients. The relative ease for harvesting (inshore shallows) will present an ideal (subject to feasibility studies) activity for building sustainable business enterprises for rural communities on a wider scale throughout NIP.

NIP SME Business Enterprise Development

Baitfish needs consideration in our program as NIP is positioned to secure major tuna

harvesting/processing status and therefore forecasted demand will present opportunities for rural communities. The pole-‐and-‐line and longline sectors of the tuna fishery will demand constant supplies of respective baitfish supplies (pole-‐and-‐line: anchovies/herring; long-‐line: barred garfish, scad, carangid, herring, sardines). This fishery has not been implemented for some time suggesting abundant resources and the relative easier harvesting process will make this fishery widely appealing to many rural communities. The resource will still however present regulatory compliance and harvesting limits to our rural clients.

Reef food fishery (including live reef food fish) is an important traditional practice for many rural communities and will be another key enterprise development objective for our implementation. Common species snappers, emperors, trevallies, wrasses, cods, groupers coral trouts, barracudas, mullets, parrots, surgeons, tangs, unicorns and rabbit fish. This fishery will however present challenges due to over harvesting and there will be regulatory and community imposed closures to consider. However the multiple levels of market channels make this fishery an important option for rural communities. Proposed market structure: This is traditionally a semi-‐subsistence fishery for NIP with shares of catch both for local ales (markets, roadside) and local consumption by the communities. There are many more channels for this fishery for rural communities to direct sell to Kavieng market (or other rural markets), local fish buyers (including restaurants, hotels) and one major exporter. The proposed objectives will be to secure greater equity in the supply chain for rural community clients and in this way, deliver greater inclusion for NIP communities. As already proposed our aim is to provide for enhanced economic inclusion for both rural NIP communities and NIPG-‐NIBC, through investigating supply chain (cooperatives, consolidation) developments. For both processed and live reef food fish we will align with regulatory agencies (NFA, Ailen Awareness) to incorporate resources management planning (National Live Reef Food Fishery Management Plan) given the current state of reef fisheries resources.

Lobsters – ‘Kindam’ will provide suitable fisheries enterprise opportunities for NIP rural

communities in the relatively easier harvesting processes. Lobsters (Kindam) include double-‐ spined rock lobster, painted rock lobster, blue-‐spot rock lobster, scalloped rock lobster, dentate rock lobster and slipper lobster (‘bug’). Channels/Markets This fishery provides high-‐end market opportunities both locally through direct selling to restaurants and resorts around Kavieng and for the export market. Our proposed equity models proposed enhanced supply chain developments (cooperatives) to achieve scale and location efficiencies. We also propose to promote economic inclusion for NIP rural communities and NIPG (NIBC) in the investigation of suitable forms of PPP’s. Resource management (National Lobster Fishery Management Plan) will guide any final fisheries development implementations for each rural community.

NIP SME Business Enterprise Development

Mud crabs –‘Almang’ provides another traditional fishery option for NIP rural communities

and presents a ready resource for generating market sales. The relative ease of harvesting and traditional food source from ‘almang’ provides suitable enterprise developments for rural communities in PPP’s through NIBC. The proposed market and supply chain developments like all other fisheries will include alignment into a centralized consolidation facility located preferably in Kavieng, to attain economies (scale, location) for the fishery. Central to this fishery development will be the requirement for our programs to link to regulatory agencies (NFA, Ailen Awareness) to effectively manage this resource as part of any enterprise management planning.

NIP FISHERIES-‐BASED PROGRAM Strategic Program Approach Increased NIP equity Strategically our program seeks to support two broader objectives in facilitating increased economic inclusion for NIP rural communities and through partnering with NIBC, to support the further economic inclusion and sustainability of NIPG for its longer-‐term aims of semi-‐ autonomy. In this context our SME Fisheries Program component will investigate options for achieving economies of scale, scope and location through fisheries cooperatives and other enhanced supply chain developments for rural NIP fishery based community enterprises (in partnership with NIBC). Through investigation we propose to establish sustainable fisheries enterprises for those rural communities (see Appendix A) and further to secure their increased equity in the supply chain. We propose a two-‐phased program approach to build sustainability in rural fisheries based enterprises (Phase One) and a subsequent focus on developing enhanced supply chain (value adding) processing options (Phase Two), to generate increased community employment and revenue outcomes. Phase One (2014-‐15) Our initial program activities will build sustainable fisheries enterprises for rural NIP communities through technical and management processes to develop sound feasibility analysis and detailed business case to support resourcing (financial, human). We aim to provide export development support to enable these enterprises to broaden market channels for improved revenues and will support this through export compliance components. We will adopt a management approach to all fisheries and this will be central to our enterprise and processing specifications as will the application of export quality standards (international “Codex” food safety and fair trade standard and ISO 14001 standards for environmental management in production). Phase Two (2015-‐16) We aim to support the NIPG (Office of Economic Development) and GoPNG (DCT&I) strategic goals in promoting increased economic inclusion and greater equity in the supply chain for indigenous NIP communities. We propose (subject to investigations) to re-‐structure and/or apply innovation to enhance the supply chain so that our rural community clients are able to create efficiency economies (scale, location, scope) including through consolidating their harvest in Kavieng and then to make direct (including export) sales to the final buyers.

NIP SME Business Enterprise Development

Program Management

Our SME Fisheries Program component will focus on fisheries based sector for NIP and specifically the development of sustainable enterprises for rural communities to promote economic inclusion and increased equity in the commercial supply chain: Program scope objectives (2014-‐16) • Develop sustainable fisheries based enterprises and increase participation in deep-‐ sea, reef food (including live reef food), crustacean, beche-‐de-‐mere and bait fish market development • Build from current levels of fisheries participation to around 20-‐50% increase over three year program (2014-‐16) for rural NIP communities simultaneously across NIP fisheries zones (see Appendix A) • Investigate and propose suitable models to NIGP (through NIBC) to create sustainable PPP’s with rural NIP fisheries communities to enhance equity for both sectors in the fisheries industry • Develop proposals to NIGP (through NIBC) to enhance the fisheries supply chains including building on existing fisheries cooperatives and other value adding to increase economic inclusion of both rural NIP communities and NIBC • Align sustainable fisheries enterprise developments (including the PPP) to other program thematic components including the provision of innovative (mobile delivery) of market data and intell to promote enterprise management for NIP rural communities • Align fisheries enterprises (including the PPP) to ultimate regional and global markets through integration of suppliers to a web based portal (proposed) to connect NIP rural communities to the fisheries commercial markets

Consultation model Our strategic and principle partner in the SME Fisheries Program component will be the NIPG through the Office of Economic Development, through which we propose to implement our enterprise development scope of activities. In this context we will progress the scope refinement and funding support through the Office of Economic Development in consultations with the NIBC (through the Office). Another key strategic partner will be through consultations with the regional LLG’s across NIP to align our program scope and activities with their current/planned annual work plans and programs. This will include processes to expand inclusion of the proposed PPP model to all affected LLG’s (for fisheries developments). At this level we will engage through NIIBC to align our enterprise (SMEs) aims with their NIP objectives. At the direct impact levels we will actively engage through the management structure at the rural community levels (Chief-‐Executive Councils), for all enterprise planning and developments.

NIP SME Business Enterprise Development

Beyond this level our program consultations will extend to the inclusion of local non-‐profits (Ailen Awareness) amongst others, to actively engage with these actors in our community development and resource management scope of activities.

SME PROGRAM MANAGEMENT

NIPG: Economic OfYice NIBC LLGs NIIBC Rural Communities NPO's: Community groups

NIP SME Business Enterprise Development

Appendix A: NIP Fisheries Program

SME PROGRAM FOCUS Supporting NIP’s fisheries sector (2014-‐2016):

DEEP SEA FISHERY

Promoting growth of bottom or near-‐bottom fisheries-‐ snappers, emperors, jacks, cods and groupers that live in • Focused on depths ranging from 80– 360 establishing/growing domestic & export fishery m enterprises for all NIP Island-‐based • Mussau Island communities communities • Aligning NIP fisheries • Emirau & Tench Island exporters to Pacific communities regional and global markets • New Hanover Island communities • Providing technical support and training in • Tigak Island communities fisheries export compliance • Lihir Island communities

NEW IRELAND FISHERIES REEF FISHERY CRUSTACEA FISHERY Promoting growth of reef food fisheries-‐ snapper, emperors, trevally, wrasse, cod, grouper, and coral trout, barracuda, mullet, parrot, surgeon, tang, unicorn and rabbit fish

• Mussau Island communities • Emirau Island communities

• Tigak Island communities

• Djaul Island communities • Namatanai LLG • Tingwon Island communities ‘Cooka’ • Tsoi Island communities • Tsoi Island communities • Tabar Island communities • Tigak Island communities • Lihir I sland c ommunities • Balgai Bay communities • Tanga Island communities • Kavieng Urban LLG

• Delivering enhanced and dedicated fisheries market intelligence data services

Promoting growth of lobster (kindam) -‐ double-‐spined rock lobster, painted rock lobster, blue-‐spot rock lobster, scalloped rock lobster, dentate rock lobster, slipper lobster or “bug” and mud crab (cooka) fisheries: ‘Kindam’ • Mussau Island communities • Djaul Island communities • Tsoi Island communities

OTHER FISHERY Promoting growth of bait-‐ fish for pole-‐and-‐line and tuna longline fisheries Pole-‐and-‐line anchovies Longline herring

• Ysabel passage communities • Tigak Island communities • Three Island Harbour communities

NIP SME Business Enterprise Development

NIP TOURISM BACKGROUND & JUSTIFICATION “We are a unique place. We have a natural beauty, both on the land and in the sea. Our tropical forests should be a mecca for tourists. Kavieng and New Ireland will become the Rising Star of the Pacific. It is my vision for Kavieng to become the Bali of Papua New Guinea.” (Rt. Hon Sir Julius Chan Governor of New Ireland, ‘On The Occasion of the Appropriation (2014) Bill’, Provincial Assembly– December 2013).

New Ireland Province (NIP) is one of the emerging markets amongst PNG for the burgeoning tourism industry with strategic advantage in its close proximity to Kokopo, East New Britain province. GoPNG is currently positioning Kokopo (near Rabaul), to be the strategic hub for PNG tourism development. Enabling infrastructure (airport, roads, port upgrades) is being facilitated through the National 2014 Budget (PGK 58m). NIP (2014 Budget Appropriation) is further strengthening this economic initiative in its PGK 1billion ‘Kavieng Section 5’ redevelopment project which proposes a new shopping mall, international airport and 5 star resort (amongst others). Coupled with this is a new air service linking Cairns (Australia) to Kokopo’s Tokua airport, to establish this tourism market development. Other enabling measures include the re-‐ establishment of a PNG Consulate in Cairns to issue tourist and other visas to Australian visitors to PNG. Another emerging channel for PNG tourism is with visiting cruise ships with Carnival Australia ( AusAid project), P&O Cruises, Hapag-‐Lloyd Cruises, Japan’s NYK Cruises and North Star Cruises Australia, planning to increase visits to ports in PNG (Alotau, Madang, Milne Bay etc.) and view Kavieng as another attractive destination. Beyond this NIP is unique amongst other PNG destinations for its surf swells along the entire lengths of the province, providing another strategic advantage to the region for attracting the growing surfing based tourism market (Australia). Other tourism activities that NIP provides include fishing, diving, cycling (Boluminski Highway) and canoeing (amongst others).

NIP SME Business Enterprise Development

Linking to Key Agencies

At the national level the PNG Tourism Promotion Agency (PNGTPA) provides strategic market development through a network of global offices (Australia, Japan). PNGTPA also is the principle actor for promoting tourism based enterprise development assistance through compiling market statistics, business resources and provincial development initiatives (business enterprise reports).

There was a dedicated tourism body to promote the NIP market (New Ireland Tourism -‐ www.newirelandtourism.org.pg), however the web site appears to be inoperable (as at Feb’14). In addition there are a number of industry bodies (PNG Tourism Industry Association, PNG Tour Operators Association) that represent the interests of the operators (hotels, resorts, tours) within the PNG tourism markets. Beyond this there are tourism based community organisations for NIP such as the Nui Ailan Surf Alliance and Ailan Awareness who represent community management planning responsibilities for regulating tourism impacts of surfing and diving activities in NIP. Recognising that NIP commercial scale and community based tourism operates through multiple actors from all these sectors (GO’s, private sector, NPO’s and communities), our SME Tourism Program component will integrate with these key actors in the implementation of NIP rural community based tourism enterprise development objectives. Under our ‘Thematic-‐Sustainable Business Models’ we will provide effective business feasibility planning to support financing for rural community based tourism enterprises through banks and MFI’s (SME Stimulus); we will liaise through NIP LLG’s in planning for rural community economic developments; overall our program will support broader economic inclusion of both NIP rural communities and NIPG through NIBC (NIP semi-‐autonomy) and we aim to align through NPO’s to integrate for community development and resource management:

NIP SME Business Enterprise Development

Microfinance Institutions (MFI’s) Rural Development Banks PNG Tourism Industry Association PNG Tourism Promotion Authority (PNGTPA) Niugini Holidays PNG Tour Operators Association PNG Dive Association Surf Association of PNG Local resorts, diving and fishing operators

NIP TOURISM-‐BASED OPPORTUNITIES Sector categories Overall the PNG tourism market (2011) comprised 9% or just over 34,000 visitors with NIP capturing around 6,500 or 18% of the total. This although smaller in numbers, represents a growing market for NIP and as outlined earlier is a strategic growth area for NIP due to a number of key competitive advantages over other regional areas in PNG. Broadly the PNG tourism market comprises nature and community based experiences for visitors including diving, surfing, trekking, canoeing, cycling and village based experiences. All these categories are well suited to support NIP’s strategic growth and will therefore will form the basis for our SME Tourism Program component:

Diving:New Hanover/ Kavieng LLG

Fishing: New Hanover/ Kavieng Urban LLG

Rural communities-‐ NIBC PPP's: Integrated/broad based enterprises-‐ cottage industries; industry expansion

SurIing: Kavieng / Namatanai LLG/ New Hanover

Other: Cruise ships/ ecological/ community based

Surfing represents a ready market opportunity for NIP rural communities due to the

widespread occurrence (Kavieng Area, East Coast, New Hanover, Central) of seasonal swells (November 2012 to April) around the entire province. Coupled with the surfing tourist demographic (males 20-‐35, middle income levels), this segment will be an ideal basis for

NIP SME Business Enterprise Development

development of community based (village) accommodation and supporting enterprises (surfing items/fishing/trekking/carvings etc.). Market structure The Nui Ailan Surf Alliance manages the surfing visitors through the PNG Surf Management Plan (PNGSMP), which restricts total visitor numbers across NIP to around 80 surfers however has flexibility to increase this quota as new surfing areas are identified (subject to community access). Apart from a small number of resorts (mainly around Kavieng), there are opportunities for community based accommodation enterprises around NIP. Revenue sharing for those communities along the surfing circuit (see Appendix B), are through fees collected under the PNGSMP. Increased NIP equity Surfing based accommodation and supporting enterprise developments present market opportunities for NIP rural communities (see Appendix B), as strategic market developments are presenting increased growth of the smaller but growing NIP tourism market. Our SME Tourism Program component seeks to propose options for NIPG PPP’s with rural based communities for provision of surfing, diving, fishing, trekking, environmental and resort based (mainstream) tourism. Ultimately our focus is to promote increased economic inclusion of rural communities in tourism based enterprises across this broad spectrum, though facilitating sound business models (Sustainable Enterprise-‐Theme) and to propose innovative PPP’s with the NIPG (through the NIBC). This model will be proposed for all other tourism developments in our program.

Diving is another tourism category, which NIP has a natural endowment through being

included in the ‘Coral Triangle’ a rich bio diverse region for both marine life and reefs (encompasses the countries of Indonesia, East Malaysia (Sabah), the Philippines & Papua New Guinea). Most opportunities lie with community-‐based tourism enterprises for those rural communities in the New Hanover islands (see Appendix B) and the smaller islands located north of Kavieng (Kavieng Urban LLG).

Our SME Tourism Program component will investigate proposed PPP’s through NIBC as the preferred option to facilitate broad based enterprise developments for these affected communities. Broad based enterprises will include accommodation, integrated fishing, cultural, trekking and environmental tourism channels to create sustainable tourism based commercial inclusion for NIP rural communities. Essential to any commercial developments will be the alignment of our planning/development proposals to all regulatory agencies (including community based organisations) for regulatory compliance (environmental,

NIP SME Business Enterprise Development

cultural management guidelines). This model will be proposed for all other fisheries developments in our program. NIP -‐ Surfing based market structure

Kavieng:)Max.)20) surfers/season)(NovEApr)

Hotel/Resort) accommodation)))(KaviengE based) Opportunities)for)islandE based)communites) (Nusalik;)Nago;Edmago;Rai)

Nusa)Resort))))))))))))))))))) (expansion)of)operations) East)coast:)Max.)25) surfers/season)(NovEApr)

Opportunities)for)coastalE based)communites)()North) Cape)to)Konos)Village)

No)resorts Lavongai:)Max.)15) surfers/season)(NovEApr)

Opportunities)for)coastalE based)communites)))))))))))))))) (New)Hanover))

No)resorts)))))))))))))))))) Central:)Max.)20) surfers/season)(NovEApr)

Opportunities)for)coastalE based)communites)))))))))))))))) (Konos)to)Ramat) Community)fee)share)(PNGSMP) Surfer)accommodation)revenues Community)revenue)opportunities Resort)based)opportunities

Other considerations We will adopt a tourism standards management approach to the program and this will be central to our enterprise and processing specifications as will the application of quality management standards (including the international “Codex” food safety and fair trade standard and ISO 14001 standards for environmental management in production). This will be a standard component to each fisheries program.

Fishing is another category where NIP enjoys comparative advantages over other provinces, as there are abundant near shore reefs and open ocean fisheries grounds (see Fisheries section), which provides opportunities for innovative rural community based enterprise

NIP SME Business Enterprise Development

development options. It is proposed that cultural based (traditional) fishing enterprises be aligned to other mainstream (commercial boating) based fishing activities, be investigated for broad based economic inclusion models for promoting enterprises for NIP island and coastal communities. As with most other tourism activities (diving, surfing), most of the fishing based tourism market concentration is around New Hanover and Kavieng Urban LLG areas and our program’s strategic aims are to broaden both the geographic and economic activities for all tourism activities. In this context we propose to investigate options to promote enterprise developments for other rural areas including the Murat; Sentral Nui Ailan; Namatanai, Nimamar; Tanir and Konoagil LLGs. This will be the broad aim to spread economic inclusion and to promote a strengthened tourism market base for all NIP communities.

Other rural community based tourism opportunities lies with the growing cruise ship visits

being pioneered through (formerly AusAid) development projects to align with cruise liners (Carnival) making port visits to Alotau (Milne Bay Province) and Madang. This type of tourism requires large port facilities which traditionally restricts the leverage for commercial opportunities to those nearly communities (around Kavieng Urban LLG). Our program proposes to assist those nearby communities to build enterprises for capturing the spread of benefits through short trips to these communities to link in with existing enterprises (fishing, diving, cultural experiences etc.). Cultural based tourism offers the most wide spread potential for NIP rural communities with a vast range of activities (trekking, village stays, cultural items/experiences) providing scope for increasing the economic inclusion for many other NIP LLG’s. Our program will aim to promote this diversification of tourism market development through investigating sustainable enterprise formations across multiple NIP regions both island and coastal.

NIP TOURISM-‐BASED PROGRAM Indicative Implementation Our SME Tourism Program component will focus on promoting economic inclusion of both NIP rural communities and specifically the development of sustainable enterprises to promote economic inclusion and increased equity in the commercial supply chain: Program scope objectives (2014-‐16) • Develop sustainable tourism based enterprises and increase participation in surfing, fishing, diving and cultural based tourism market development • Build from current levels of tourism participation to around 20-‐50% increase over three year program (2014-‐16) for rural NIP communities simultaneously across NIP tourism zones (see Appendix B) • Investigate and propose suitable models to NIGP (through NIBC) to create sustainable PPP’s with rural NIP tourism based community enterprises to enhance equity for both sectors in this strategic industry

NIP SME Business Enterprise Development

•

Develop proposals to NIGP (through NIBC) to enhance the tourism supply chains including investigations for multiple focused tourism enterprises within each community (cultural artifacts, trekking, traditional fishing, environmental) to increase economic inclusion of both rural NIP communities Align sustainable tourism enterprise developments (including the PPP) to other program thematic components including the provision of innovative (mobile delivery) of market data and intell to promote enterprise management for NIP rural communities Align tourism enterprises (including the PPP) to ultimate regional and global markets through integration of community enterprises to existing industry (including promotion on our proposed web based portal), to connect NIP rural communities to industry commercial markets

Consultation model Our strategic and principle partner in the SME Tourism Program component will be the NIPG through the Office of Economic Development, through which we propose to implement our enterprise development scope of activities. In this context we will progress the scope refinement and funding support through the Office of Economic Development in consultations with the NIBC (through the Office). Another key strategic partner will be through consultations with the regional LLG’s across NIP to align our program scope and activities with their current/planned annual work plans and programs. This will include processes to expand inclusion of the proposed PPP model to all affected LLG’s (for tourism developments). At this level we will engage through NIIBC to align our enterprise (SMEs) aims with their NIP objectives. At the direct impact levels we will actively engage through the management structure at the rural community levels (Chief-‐Executive Councils), for all tourism enterprise planning and developments. Beyond this level our program consultations will extend to the inclusion of local non-‐profits (Nui Ailan Surfing Alliance, Ailen Awareness) amongst others, to actively engage with these actors in our community development and resource management scope of activities.

SME PROGRAM MANAGEMENT

NIPG: Economic OfIice NIBC LLGs NIIBC Rural Communities NPO's: Community groups

NIP SME Business Enterprise Development

Appendix B: NIP Tourism Program SME PROGRAM FOCUS

AILEN SURFING

Supporting NIP’s tourism sector (2014-‐2016):

Promoting growth of surfing based tourism enterprises Kavieng

• Focused on • Pikinini (Mongol Point) establishing/growing • Nusa Left (Karanas) tourism based enterprises • Long Longs for all NIP rural • Nago Island communities • Edmago Island • Aligning NIP tourism • Ral Island enterprises to Pacific East Coast regional and global • North Cape markets • Entire coastline Lavongai (New Hanover) • Providing technical • Malili support and training in • Uvanai (Vala vala) tourism compliance • Korongai (Gas chambers) • Delivering enhanced and • Kule Point (Outer kiddies) dedicated tourism market • Sanama intelligence data services • Senta Pass • Anselim’s Reef • Drain Pipe • Two Trees Central Coast • Konos to Ramat

NEW IRELAND TOURISM FISHING DIVING Promoting growth of reef and cave based diving tourism enterprises Kavieng Island communities around Kavieng Urban LLG • Nago Island

• Edmago Island • Ral Island

New Hanover

• Tigak Island communities • Djaul Island communities • Tingwon Island communities • Tsoi Island communities • Baudissan Island communities • All other island communities

Building sustainable community based participation for fishing based tourism:

CULTURAL EXPERIENCES

Leveraging the inclusion of all NIP communities for traditional based tourism experiences: • All NIP LLGs (West coast, • Kavieng Central, East coast) Island /coastal communities • New Hanover Island/coastal communities • Traditional cultural experiences: Artifacts • Central coastal Fishing communities Trekking • Tabar Island Communities • Multiple-‐aligned tourism • Lihir Island communities enterprises • Tanga Island communities Cruise ship visitors • Feni Island communities Village based accommodation • West coast island/coastal Integrated options (stop-‐ communities overs-‐fishing, diving, trekking)

NIP SME Business Enterprise Development

NIP AGRICULTURE BACKGROUND & JUSTIFICATION Like the rest of PNG, NIP rural communities are semi-‐subsistence farmers growing a wide variety of fruits (papaya, bananas etc.) and vegetables (taro, sweet potatoes etc.) and NIP is endowed with suitable soil and climatic conditions for agriculture. Therefore this sector presents an abundance of enterprise development opportunities for economic inclusion and the options to enhance supply chains. In its fundamental role, agriculture provides for the livelihoods (sustenance and cash economy) of all NIP residents and this is supported by NIPG through a number of innovative policy programs: • Market access programs – including subsidized (Franchised) shipping routes opening up further parts of NIP (Murat, Laongai and Djaul), • “Top-‐up tasol” -‐ Stabilisation funds for copra and cocoa export commodities, • Roads Asset Maintenance programs – improved road infrastructure to enable improved market access for rural NIP communities for their produce (West Coast, Islands and Konoagil LLGs)’ • Integrated agriculture, piggery and poultry (LR Group) development project in NIP to establish supply chain capacities for commercial markets (Lihir Gold Mine), • K1billion ‘Kavieng Section 5’ development project (Rising Star: C&C JV) including a modern shopping mall to provide expansion of the domestic commercial markets for NIP agriculture.

NIP SME Business Enterprise Development

Linking to Key Agencies

At the national level the National Department of Agriculture and Livestock (NDAL) manages the broad strategic programs for development of this sector across all provinces including NIP. There are a number of networked agencies collaborating to promote an improved and expanded agricultural economic base for both the growing domestic (PNG’s 7million population 2010) and export markets. At the regional level these same central (GoPNG) agencies including Provincial Division of Primary Industry (PDPI), National Agricultural Research Institute (NARI) and National Agricultural Quarantine and Inspection Authority (NAQIA), all provide support services to NIP rural communities for agricultural development. NARI also includes The Islands Regional Centre which is based at the Lowlands Agricultural Experiment Station (LAES) at Keravat on the Gazelle Peninsula in East New Britain Province. As well as conducting research and support programs for individual fruits and vegetables, LAES also manages Pacific regional projects. We will work within this multi level structure for the management and implementation of our SME Agricultural components, recognizing the essential framework in which all aspects of PNG agriculture is implemented. Broadly our agriculture program aims (as with all our others) are to promote increased economic inclusion of rural NIP communities through our thematic components. We aim to investigate and provide sustainable business enterprise models for agricultural market sales (including exports), provide for innovation in supply chain (value adding) options to increase community employment outcomes and to harness the efficiency economies (scope, scale and location) through integrating with the NIGP (through a PPP model).

GOPNG Agricultural Agencies: National Department of Agriculture and Livestock (NDAL) National Agricultural Research Institute (NARI) National Agricultural Quarantine and Inspection Authority (NAQIA) National Institute for Standards & Industrial Technology (NISIT) Primary Government Agriculture Bodies (PGABs) Rural Development Bank National Plantation Management Authority Provincial Division of Primary Industry (PDPI) Rural Industry Council (RIC) Department of Trade and Industry (DTI)

NIP SME Business Enterprise Development

Commodity Organizations: Coffee Industry Corporation Kokonas Indastri Koporesen Cocoa Board and Cocoa Coconut Institute Livestock Development Corporation Fresh Produce Development Agency Oil Palm Industry Corporation Spice Industry Board Rubber Board

NIP AGRICULTURE-‐BASED OPPORTUNITIES

Sector categories Economic indicators (2010) for NIP rural communities outline the agricultural base which consists of copra (coconuts) and cocoa (55%: 36%) for cash-‐earning activities. Production of all food crops (fruits and vegetables) although high, only makes up around 13% of cash-‐ economy earnings. The food products category represents the most widely applicable economic opportunity for rural NIP communities and will form our priority program component.

Food crops (fruits and vegetables) project activities will support (through investigation)

options for promoting creation of market based enterprises including local, domestic (PNG) and export market access for additional revenue and sales channels. Through aligning with NIPG (NIBC PPP) our SME Agricultural Program component will seek to create strategic markets for rural community food harvests in the growing economic zones (Kokopo) for tourism as well as to supply the local tourism base (see SME Tourism Program). Beyond this we will investigate options for proposed enhanced value adding (through other industry actors) to support community processing hubs/cottage industries (e.g. drying/processing fruits and vegetables), to promote increased employment and supply chain equity. Cash crops (cocoa, copra , coffee, vanilla etc.) also represent another significant economic market for rural NIP communities and represents potential for broadening the distribution of farming activities across NIP. In this context our program aims to support the existing sector programs through provision of business enterprise feasibility developments (for rural communities) with focus on export market development through both alignments to existing industry marketing channels as well as our (proposed) web based portals and enterprise planning data/intell services.

NIP AGRICULTURE-‐BASED PROGRAM Strategic Program Approach Increased NIP equity Strategically our program seeks to support two broader objectives in facilitating increased economic inclusion for NIP rural communities and through partnering with NIBC, to support the further economic inclusion and sustainability of NIPG for its longer-‐term aims of semi-‐ autonomy. In this context our SME Agriculture Program component will investigate options for achieving economies of scale, scope and location through market cooperatives and other

NIP SME Business Enterprise Development

enhanced supply chain developments for rural NIP based community enterprises (in partnership with NIBC). Through investigation we propose to establish sustainable agriculture enterprises for those rural communities (see Appendix C) and further to secure their increased equity in the supply chain. We propose a two-‐phased program approach to build sustainability in rural agriculture based enterprises (Phase One) and a subsequent focus on developing enhanced supply chain (value adding) processing options (Phase Two), to generate increased community employment and revenue outcomes. Phase One (2014-‐15) Our initial program activities will build sustainable agriculture enterprises for rural NIP communities through technical and management processes to develop sound feasibility analysis and detailed business case to support resourcing (financial, human). We aim to provide export development support to enable these enterprises to broaden market channels for improved revenues and will support this through export compliance components. We will adopt a management approach to all agriculture and this will be central to our enterprise and processing specifications as will the application of export quality standards (international “Codex” food safety and fair trade standard and ISO 14001 standards for environmental management in production). Phase Two (2015-‐16) We aim to support the NIPG (Office of Economic Development) and GoPNG strategic goals in promoting increased economic inclusion and greater equity in the supply chain for indigenous NIP communities. We propose (subject to investigations) to re-‐structure and/or apply innovation to enhance the supply chain so that our rural community clients are able to create efficiency economies (scale, location, scope) including through consolidating their produce in Kavieng and then to make direct (including export) sales to the final buyers. Proposed agriculture market structure: Local'Markets'''''''''''''''''''' (NIP'regional)

Export'Markets''''''''''

PNG'Markets'''''''''''''''''''' (PNG'regional)

Cooperatives/'Consolidation:'NIBC'PPP

Processing:'value'add NIP'Communities'''''''''' Rural'food'crops

Indicative Implementation Our SME Agriculture Program component will focus on promoting economic inclusion of both NIP rural communities and specifically the development of sustainable enterprises to promote economic inclusion and increased equity in the commercial supply chain:

NIP SME Business Enterprise Development

Program scope objectives (2014-‐16) • Develop sustainable agriculture based enterprises and increase participation in food (fruits and vegetables) and cash (copra, cocoa, coffee, vanilla etc.) crop market development • Build from current levels of agriculture based (formal) economic participation to around 20-‐50% increase over three year program (2014-‐16) for rural NIP communities (see Appendix C) • Investigate and propose suitable models to NIGP (through NIBC) to create sustainable PPP’s with rural NIP agriculture based community enterprises to enhance equity for both sectors in this strategic industry • Develop proposals to NIGP (through NIBC) to enhance the agriculture supply chains including investigations for increased value add/processing enterprises within each community to increase employment and economic inclusion of both rural NIP communities • Align sustainable agriculture enterprise developments (including the PPP) to other program thematic components including the provision of innovative (mobile delivery) of market data and intell to promote enterprise management/planning for NIP rural communities • Align agriculture based enterprises to ultimate regional and global markets through integration to existing industry marketing channels (including promotion on our proposed web based portal), to connect NIP rural communities to commercial markets Consultation model Our strategic and principle partner in the SME Agriculture Program component will be the NIPG through the Office of Economic Development, through which we propose to implement our enterprise development scope of activities. In this context we will progress the scope refinement and funding support through the Office of Economic Development in consultations with the NIBC (through the Office). Another key strategic partner will be through consultations with the regional LLG’s across NIP to align our program scope and activities with their current/planned annual work plans and programs. This will include processes to expand inclusion of the proposed PPP model to all affected LLG’s (for agricultural developments). At this level we will engage through NIIBC to align our enterprise (SMEs) aims with their NIP objectives. At the direct impact levels we will actively engage through the management structure at the rural community levels (Chief-‐Executive Councils), for all agricultural enterprise planning and developments. Beyond this level our program consultations will extend to the inclusion of local non-‐profits, to actively engage with these actors in our community development and resource management scope of activities.

NIP SME Business Enterprise Development

SME PROGRAM MANAGEMENT

NIPG: Economic OfDice NIBC LLGs NIIBC Rural Communities NPO's: Community groups

NIP SME Business Enterprise Development

Appendix C: NIP Agriculture Program SME PROGRAM FOCUS

NEW IRELAND AGRICULTURE SUSTAINABLE ENTERPRISE ENHANCING SUPPLY MARKET INTELLIGENCE DEVELOPMENT CHAIN CAPABILITIES SERVICES

Supporting NIP’s agriculture sector (2014-‐2016):

Promoting growth of agricultural enterprises:

Enhancing commercial value across the agricultural chain:

Providing tailored and timely Boosting the export growth market information: of agricultural communities:

• • • • • • • • •

Murat Rural LLG Lavongai Rural LLG Kavieng Urban LLG Tikana Rural LLG Sentral Niu Ailan Rural LLG Namatanai Rural LLG Nimamar Rural LLG Tanir Rural LLG Konoagil Rural LLG

• Assisting the rapid growth

community processing hubs and employment

• Providing specialist global business development support to boost exports

• Aligning all agricultural participants across the chain to boost exports for key markets

• Delivering tailored

• Improving the processing and export compliance standards across the chain

business planning and management support

• Integrating enterprise

management with market • Connecting agri-‐business intelligence advantages with enhanced market data for better planning

• Delivering timely global and regional market data to assist enterprises • Connecting agricultural communities to global markets through data intelligence

• Linking all levels to build

of viable agri-‐business enterprises

• Specialist international business and trade support services

• Promoting agricultural

• Integrating market

exporters via web-‐based platform connecting them to global markets

• Linking agricultural

intelligence data with enterprise planning

exporters compliance with global markets

• Innovations in market data and intelligence delivery platforms

EXPORT MARKET ALIGNMENT

• Integrating agricultural

exporters with global market access and buyers

NIP SME Business Enterprise Development

NIP COMMUNITY-‐BASED FORESTRY BACKGROUND & JUSTIFICATION Forests are a natural resource to PNG rural communities and a large majority (33million hectares) of the country is covered in natural forests. Beyond that as traditional custodians of forestry resources, PNG rural communities depend on forestry resources to meet their wide range of social and (increasingly) economic (cash-‐based) needs. The current state of commercial logging operation across PNG provides around 7% to GDP (2011), however a combination of misuse of the State’s Special Agricultural and Business Leases (SABLs), improper commercial logging practices and the global consumer trend towards sustainability, is placing pressures on the continued survival of this industry in PNG. In recognition of this the NIPG is to cease all commercial (foreign) logging operations: “The first thing we will do is to stop the cowboy logging operations going on in New Ireland. Companies are coming in without even a license and stripping our forests. My Government is placing a total ban on logging, whether the National Government likes it or not.” (Rt. Hon Sir Julius Chan Governor of New Ireland, ‘On The Occasion of the Appropriation (2014) Bill’, Provincial Assembly– December 2013).

There is a growing trend towards community-‐based sustainable forestry practices as a means of economic inclusion for rural PNG communities and this provides valuable skills and transfers management rights back to the traditional owners. Foremost amongst these enterprise activities is the growth of mobile (walk-‐about) saw milling forestry activities.

nont and orest tandwork internageribed oved unity .

Community forest management often empowers and includes the whole community. Here, young boys from the Sogi community carry sawn timber to the roadside for export to Australia (Photo: Julian Fox). See Fox et al. (2011b).

References Alder D. 1998. PINFORM: a growth model for lowland tropical forest in Papua New Guinea. ITTO Project PD 162/91, International Tropical Timber Organization (ITTO) / Papua New Guinea Forest Research Institute

Centre for International Agricultural Research: Canberra. [These proceedings] Coote D.C. and Fox J.C. 2011. Scenario analysis of selective-harvesting, carbon dioxide emissions and REDD+ in Papua New Guinea. In ‘Native forest management in Papua New Guinea: advances in assessment, modelling

NIP SME Business Enterprise Development

Linking to Key Agencies

At the national (GoPNG) level the PNG National Forestry Authority (PNGFA) manages the industry development and regulation processes, through a regional network of agency offices (including NIP). This network is further strengthened through the inclusion of the National Forest Service and the Provincial Forest Management Committees. There are some industry representation including representatives of the National Resource Owners Association and the Association of Foresters of PNG. At the NGO and community levels forestry operations are heavily scrutinized through agencies including The World Wildlife Fund (WWF), Greenpeace as well as the research and industry development activities of Asian Development Bank (ADB), United Nations Development Program (UNDP) amongst others. Given the multi level jurisdictions that regulate and manage all forestry based industry developments in PNG (including NIP), we aim to align and collaborate with these actors in our SME Forestry Program component. GO’s: New Ireland Provincial Government (NIPG) Office of Economic Development New Ireland Business Corporation (NIBC) Murat Rural LLG Lavongai Rural LLG Kavieng Urban LLG Tikana Rural LLG Sentral Niu Ailan Rural LLG Namatanai Rural LLG Nimamar Rural LLG Tanir Rural LLG Konoagil Rural LLG

GOPNG Agricultural Agencies: PNG Forest Authority National Forest Service Provincial Forest Management Committees. NGOs WWF Greenpeace ABD UNDP Industry Organizations: Sustainable Forestry Products

NIP SME Business Enterprise Development

NIP COMMUNITY-‐BASED FORESTRY OPPORTUNITIES Sector categories

For NIP (and the industry) there is mainly one key economic inclusion activity to community-‐ based forestry which is to establish mobile (walk-‐about) saw milling and timber sales (including exports). Broadly this activity is most suited to the smaller scale of rural communities and will form the primary focus for our SME Forestry Program component. Mobile saw milling involved the portable use of a timber cutting saw that can be carried to a forestry location, set up and used to cut lengths of felled timber (trees). Therefore this enterprise activity is best suited to NIP rural communities and provides economic inclusion through market sales including exports of rough-‐sawn (green) timbers. Our program will commence with a proposed two-‐year pilot project to be managed for the ‘Fanamaket’ communities (Sena, Muliama and Wharangsau villages) of Cape Sena (Konoagil Rural LLG). Through our SME management entity (SME Developers Ltd) we have proposed to provide forestry expertise (technical assistance) to ensure we build sustainable business enterprises, forestry management practices and successful market sales channels. We aim to restore traditional ownership rights to NIP rural communities through training across all operational aspects of the forestry enterprise and to adopt sustainability (conservation) practices to ensure minimal lasting environmental impacts and renewable resources management. Downstream processing has been proposed as a second (longer term) project phase to provide equity in the supply chain for NIP rural communities and we intend to partner through NIBC (PPP) to implement these additional enhancements. Our objective is to broaden the economic base, create the nucleus for processing hubs/cottage industries for joinery and/or furniture making, further enhance skill sets and ultimately bring increased revenue to NIP rural communities.

PHASE 1: Sustainable forestry enterprise • Business planning • Forestry training

INCREASED EQUITY

PHASE 2: Value adding

• Greater economic inclusion • Increased revenues

• Increased supply chain equity • Product expansion

NIP SME Business Enterprise Development

NIP COMMUNITY-‐BASED FORESTRY PROGRAM

Indicative Implementation Our SME Forestry Program component will focus on promoting economic inclusion of both NIP rural communities and specifically the development of sustainable enterprises to promote increased equity in the commercial supply chain: Program scope objectives (2014-‐16) • Develop sustainable forestry based enterprises and increase participation in sustainable community based timber milling and exports • Build from current levels of forestry based (formal) economic participation to around 20-‐50% increase over three year program (2014-‐16) for rural NIP communities (see Appendix D) • Investigate and propose suitable models to NIGP (through NIBC) to create sustainable PPP’s with rural NIP forestry based community enterprises to enhance equity for both sectors in this strategic industry • Develop proposals to NIGP (through NIBC) to enhance the forestry supply chains including investigations for increased value add/processing enterprises within each community to increase employment and economic inclusion of both rural NIP communities • Align sustainable forestry enterprise developments (including the PPP) to other program thematic components including the provision of innovative (mobile delivery) of market data and intell to promote enterprise management/planning for NIP rural communities • Align forestry based enterprises to ultimate regional and global markets through integration to existing industry marketing channels (including promotion on our proposed web based portal), to connect NIP rural communities to commercial markets Consultation model Our strategic and principle partner in the SME Forestry Program component will be the NIPG through the Office of Economic Development, through which we propose to implement our enterprise development scope of activities. In this context we will progress the scope refinement and funding support through the Office of Economic Development in consultations with the NIBC (through the Office).

Another key strategic partner will be through consultations with the regional LLG’s across NIP to align our program scope and activities with their current/planned annual work plans and programs. This will include processes to expand inclusion of the proposed PPP model to all affected LLG’s (for community based forestry developments). At this level we will engage through NIIBC to align our enterprise (SMEs) aims with their NIP objectives.

NIP SME Business Enterprise Development

At the direct impact levels we will actively engage through the management structure at the rural community levels (Chief-‐Executive Councils), for all community based forestry enterprise planning and developments. Beyond this level our program consultations will extend to the inclusion of local non-‐profits, to actively engage with these actors in our community development and resource management scope of activities.

SME PROGRAM MANAGEMENT

NIPG: Economic OfUice NIBC LLGs NIIBC Rural Communities NPO's: Community groups

NIP SME Business Enterprise Development

Appendix D: NIP Forestry Program SME PROGRAM FOCUS

NEW IRELAND FORESTRY (COMMUNITY-‐BASED) SUSTAINABLE ENTERPRISE ENHANCING SUPPLY MARKET INTELLIGENCE DEVELOPMENT CHAIN CAPABILITIES SERVICES

Supporting NIP’s community-‐ based forestry sector (2014-‐2016):

Promoting growth of sustainable forestry enterprises: PHASE ONE

Enhancing commercial value across the processing chain: PHASE TWO

• • • • • • • • •

Murat Rural LLG Lavongai Rural LLG Kavieng Urban LLG Tikana Rural LLG Sentral Niu Ailan Rural LLG Namatanai Rural LLG Nimamar Rural LLG Tanir Rural LLG Konoagil Rural LLG

• Business planning and forestry expertise

Providing tailored and timely Boosting the export growth market information: of forestry based communities: • Delivering timely global and regional market data to assist enterprises • Connecting forestry communities through data intelligence

options for increased value

• Providing increased employment and skills

• Reducing risk through

effective management processes

• Providing increased skills through training

• Promoting increased equity in resource ownership

• Increasing economic inclusion and revenues

• Specialist international business and trade support services

• Provide direct

• Integrating market

export/buyer market connections

• Linking forestry exporters

intelligence data with enterprise planning

• Expanding processing

• Implementing forestry management and renewable components

EXPORT MARKET ALIGNMENT

compliance with global markets

• Innovations in market data and intelligence delivery platforms

• Integrating forestry

enterprises with global market access and buyers

NIP SME Business Enterprise Development

CONTACT DETAILS Our Program Directorate can be contacted at the following: SME Developers Ltd Designated consortium address: ANG House, Level 2, Suite 3 Hunter Road Port Moresby National Capital District Papua New Guinea Program Director –Mr. Chris Marshall M: +61 427 892 465 E: chrism@kaltanepl.com W: http://www.kaltanepl.com Program Delivery Manager – Mr. John Jambert Mobile: +675 7315 0555 E-‐mail: johnjambert@gmail.com