June 2013 by Islands Business

04_NANSM_205_275_IBM.pdf 1 13. 04. 30 오후 6:00

CMY

June 2013

Vol. 39, No. 6

Contents 39 Viewpoint

Rejecting free trade requires new forms of regionalism

Mining

40 A reality or illusion for the islands? The minerals lying deep beneath our shores

42 Viewpoint

Sea-bed mining–riches or regrets?

Agriculure

43 Tongan vanilla to bounce back Top brands to

drum up production

Culture

46 Scholars digitise endangered languages Intellectual Property

COSTLY NEMESIS. Cover report—pages 16-21.

protection assured

Cover Report

Regular Features

Natural disasters could cost US$278m a year for PICs

6 Views from Auckland

Politics

7 We Say

16 Costly Nemeses

22 Gaston Flosse tells big companies: ‘help the poor’ But ‘Old Lion’ faces uncertain future

24 US citizenship for long-term foreign workers?

12 Whispers 14 Pacific Update

US Senate to discuss immigration bill

44 Business Intelligence

25 China makes splashes in the Pacific

47 RAMSI Update

Focus? Winning the hearts of the islands

26 Tuvalu’s high court orders by-election to be held Nauru in a state of emergency

Environment

30 ‘We have grown, so as the challenges’: Sheppard

Defence

32 Canberra plan tightens defence ties

But what does it mean to islands countries?

34 Viewpoint

Australian defence encounters new Pacific realities

Fisheries

35 US to pay over US$94m in a transitional fish deal

Negotiators hope to finalise deal end 2013

36 PNA moves to market first sustainable tuna in Europe Business initiative to command premium prices

Trade

37 EU reveals its EPA ‘cards’

Brussels negotiations to boil down to fishery, market access, trade in services

38 Why PACER is not good for PNG: Maru Islands Business, June 2013 3

Managing Director/Publisher Godfrey Scoullar Group Editor-in-Chief Laisa Taga Group Advertising & Marketing Manager Sharron Stretton Staff Writer Robert Matau

Graphic Design Dick Lee Virendra Prasad Main Correspondents Australia Rowan Callick Nic Maclellan Davendra Sharma Fiji Samisoni Pareti Dionisia Tabureguci French Polynesia Thibault Marais

Marshall Islands Giff Johnson New Zealand Dev Nadkarni Jale Moala Ruci Salato-Farrell Duncan Wilson Niue Stafford Guest Papua New Guinea Baeau Tai P Sam Vulum Patrick Matbob P Peter Niesi Solomon Islands Evan Wasuka Alfred Sasako T Tonga Taina Kami-Enoka T V Vanuatu Bob Makin

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Column Moresby, as is the need for housing; the need for first-class hotels is growing, as is the need for better and more up-to-date supermarkets. “You’ve got the opportunities around supply of water, the processing of waste water, and you’ve also got opportunities around the development of an energy grid,” Greenslade said.

Views from Auckland BY DEV NADKARNI

PNG a magnet PNG has become a magnet for regional and international events. In 2015, it will host both the Pacific Games and APEC (Asia Pacific Economic Cooperation) Summit, bringing a host of opportunities for New Zealand companies to help with building infrastructure in what is widely acknowledged as being their forte. The trade delegation engaged with several industries and businesses across the board to further opportunities for New Zealand businesses in the fast growing PNG economy. But it will be awhile before there is any appreciable boost in exports from New Zealand into PNG. Though it is the Pacific islands region’s biggest market, both in terms of GDP and population, New Zealand does far more trade with Fiji than with PNG. As well as having been out of sight, out of mind for all these decades, political and business engagement Fiji goods on display in Port Moresby...following a visit to PNG of a Fiji trade between the two countries delegation, headed by Prime Minister Voreqe Bainimarama. Photo: Fiji’s Information has not been anywhere Ministry near the level at which PNG’s relationship with Australia is. New Zealand’s annual assistance to PNG is shape and form.) NZ$35 million, relatively small in the bigger Last month, New Zealand businesses launched scheme of things that PNG is eyeing. a substantial trade mission, reportedly the fifth in For instance, Australia already has a double two years, to PNG. taxation avoidance treaty in place, which isn’t A team comprising some 30 delegates unyet the case with New Zealand. Though such a der the aegis of the New Zealand/Papua New treaty has been signed, it is yet to be implemented Guinea Business Council, New Zealand Trade by Port Moresby at the PNG end of the deal. and Enterprise (NZTE) and the New Zealand Diplomatic efforts are afoot to get on with the Government’s Ministry of Foreign Affairs and matter as early as possible. Trade toured the MSG flag bearer for a week. The slow pace of implementation at the PNG New Zealand is rightly eyeing the big opend is perhaps symptomatic of the relatively low portunities in the infrastructure sector that are importance PNG accords New Zealand while becoming available around increased inward being wooed relentlessly by global mining giinvestment in core sector projects such as petroants and its far closer and much bigger Asian chemical and mineral prospecting. neighbours. While Australia has concentrated within the In the meantime, New Zealand companies core sector proper given its background and vast find themselves at a disadvantage competing experience at home, New Zealand seems to be with Australian companies because of the double looking at infrastructural ancillaries—something taxation. which it has made a success of around the Pacific Besides, New Zealand companies have a long building ports, wharves, marinas, roads, bridges way to go before getting acclimatised to PNG’s and other infrastructure. rather challenging realities such as the seemingly Michael Greenslade, Pacific Trade Commisever widening wealth disparities, widespread sioner for NZTE, who also did a stint a few years bureaucratic graft, not to speak of the widely ago in Fiji, said, “The challenge that PNG has is perceived issues of law and order. that its infrastructure is poor. The opportunity But it is better late than never. Aligning itself for New Zealand companies is to not only assist more closely to countries of the emerging MSG in the exploitation of natural resources, but also trade bloc makes eminent sense for New Zealand to build infrastructure that is necessary for that in shoring up its diminishing footprint in the exploitation.” Pacific Islands region in recent years. “The professional classes are growing in Port

Wooing PNG in right earnest Australia and New Zealand’s relationships with Pacific Islands nations historically seem to have been divided along the two main sub-regions of Melanesia and Polynesia. The possible exception is Fiji, where both the ANZAC nations have had more or less the same level of involvement. Perhaps, it has to do with Fiji’s acknowledged status as the gateway to the region—the doorway to both Melanesia and Polynesia. Geographically, too, Australia is closer to the Melanesian nations of Papua New Guinea, Solomon Islands and Vanuatu, while New Zealand’s proximity is to such Polynesian countries as Tonga, Samoa, Niue, Tuvalu and the Cook Islands, besides others. These old historical and geographical relationships along sub-regional lines have carried on into the modern era with political, business and people to people relationships having developed along these very lines. Small wonder then, that Auckland is now known as the world’s largest Polynesian city, which also hosts the world’s largest Polynesian festival every year in February. Australia, though, does not have as representative a population of Melanesian people as Auckland does Polynesians. But Australian engagement in business and investment terms in Melanesia greatly outstrips similar engagement of New Zealand in Polynesia. Pace of development The sheer force and pace of development in some Melanesian nations is beginning to change that. The entire region appears to have realised that you ignore the rapid developments happening in countries like Papua New Guinea at your own risk. Australia has long jumped on the bandwagon and over the past two years, New Zealand has taken tentative steps with at least half a dozen trade missions to the region’s fastest growing economy. This desire to get a piece of the action in PNG is not restricted to just Australia and New Zealand in the region. The Melanesian Spearhead Group (MSG) member nations have organised themselves to strengthen trade and investment ties and are meeting frequently with a view to grow into a common market in the not too distant future. (And it doesn’t end there: reports are doing the rounds that Polynesian countries like Samoa and Tonga have expressed a desire to be a part of the newly conceived trading bloc in a suitable 6 Islands Business, June 2013

WESAY ‘Let’s be clear: deep-sea minerals within the 200-mile exclusive economic zones are owned by our islands and even the high seas pockets that Pacific EEZs surround can be controlled, as PNA has again shown, giving the islands substantial clout if they take a unified position. If not, we can guarantee that foreign investors... will use their expertise to ensure their offshore access is not limited, profits are maintained and competition is thwarted’

he new era of fisheries management in the Pacific confirms one important fact: The billions of dollars Pacific Islands have lost over the past decades while being passive observers of the fishing industry. As recently as 18 months ago, the United States Government and its fishing industry said double the current price of access fees for a new treaty was the most they could afford—and then tripled the amount (from US$21 million to US$63 million a year), and probably would have paid more if Pacific Islands had pressed the issue. Meanwhile, fishing day fees for purse seiners of all nations to fish the lucrative skipjack tuna waters in the region have nearly tripled, from under US$2,000 a day to at least US$5,000, and will rise next January to US$6,000. What has forced these concessions in the past three years from the distant water fishing nations that have dominated the Pacific fishery for decades? Very simply this: the eight-member Parties to the Nauru Agreement (PNA), which controls waters where 70 percent of the region’s skipjack is caught, has forced a paradigm shift in the tuna industry. Today, PNA controls the industry by maintaining unity in support of regional policies that are increasing the benefits to all islands far beyond the traditional practice of selling licences to boats that reap profits from Pacific waters. With deep-sea mining now back on our doorstep, the PNA model is extremely relevant to managing this potential industry that nations from outside the Pacific are hoping to cash in on. “Minerals, such as rare earth metals, are increasingly becoming an important commodity in a resource-constrained world economy,” wrote Dr Cristelle Maurin, SOPAC’s legal consultant in Suva, in an April policy brief issued by the Institute for Security and Development Policy, a Stockholm-based independent and non-profit research and policy institute. SOPAC (Applied Science and Technology) is a division of the Secretariat of the Pacific Community. “As a result, new frontiers both onshore and offshore to the depths of the ocean are emerging around the world. The Pacific region stands at the forefront of this pioneering venture.” Almost everyone agrees that our islands have virtually no experience or legal infrastructure to handle deep-sea mining, which is a position that stands to benefit foreign mining interests in much the same way distant water fishing nations have benefitted handsomely

from the extraction of billions of dollars of tuna from the Pacific over many decades. Currently, SOPAC is raising awareness among government and business leaders in the Pacific Islands Forum Countries about the issue. But deep-sea mining shouldn’t be handled in bilateral discussions and workshops. It needs the full-on attention of governments in the region to deal on a regional basis, just as PNA has done. Last month, for example, local businesspeople in one Forum Islands Country were invited by a government office with same-day notice to meet a SOPAC technical advisor regarding the “Deep-Sea Mineral Project.” The invitation noted that the advisor “has been hired by SPC to provide legal support to 15 participating member countries to allow for deep-sea mineral exploration and mining. She is here to answer any questions and concerns relating to the Deep-Sea Mineral Project.” This apparently last minute, “stop over if PNA-style you have questions” approach to the issue management for needs to be replaced with a systematic resea-bed mining? gional method and it is an issue Pacific Islands Forum Leaders should have on their agenda when they meet in Majuro in September. Let’s be clear: deep-sea minerals within the 200-mile exclusive economic zones are owned by our islands and even the high seas pockets that Pacific EEZs surround can be controlled, as PNA has again shown, giving Pacific Islands substantial clout if they take a unified position. If not, we can guarantee that foreign investors, mining companies, brands and traders will use their expertise to ensure their offshore access is not limited, profits are maintained and competition is thwarted. Even though we can see the success of the PNA model, many government leaders and officials in the region are still operating on the basis of the now outdated models. Many still see fisheries (and possibly deep-sea mining to follow) as a matter for bilateral negotiations even though PNA has demonstrated the clout that a bloc of nations brings to the table. For years, the islands have been merely collecting licence fees, bringing but a tiny fraction of the profit from tuna into the islands, while distant water fishing nations get control of the resource to value add and trade. Islands Business, June 2013 7

WESAY What is the experience with mining on land? Resources are taken offshore for processing, while the islands are left with a fraction of the revenue, the tailings, environmental degradation and social problems. Will it be the same for deep-sea mining? There is an opportunity to get deep-sea mining right from the start if the islands are going to entertain the option. Forum Islands Countries can set minimum terms and conditions regionally for mining access; require that exports must clear ports in the region; insist exports be inspected and taxed; and demand investment in shore-side facilities that increase job opportunities. Forum Islands Countries need to establish their own regional

agreement and use the technical expertise of SOPAC and other agencies on a regional basis, not on a bilateral basis. PNA is funded by its members to be independent of the donors and avoid efforts to influence its decisions through aid. The one fundamental difference between tuna and mineral mining is tuna is a renewable, sustainable resource if managed; minerals are a “one and done” proposition. The Forum should set the goals for a regional approach to deepsea mining to ensure the benefits go to the resource owners and small islands economies are not played off against each other for the gain of distant mining nations.

‘One of the more dramatic public pronouncements made at the meeting was by PNG’s Trade Minister Richard Maru. He said his country was considering opting out of the PACER (Pacific Agreement on Closer Economic Relations) Plus negotiations. The announcement was not wholly unexpected, though. Discontent at PACER’s provisions, its lackadaisical pace and the view among MSG member nations that the deal is heavily skewed towards Australia and New Zealand has steadily gained ground’

n the past couple of years, member countries of the group that closely shares a number of ethnic, cultural and historical features appears to have come closer, announcing several measures at co-operating on a range of matters concerned with the movement of their citizens across mutual political borders and strengthening trade links. According to estimates, exports between countries in this group of nations have grown more than 300 percent in the years between 2005 and 2009. Just a couple of months ago, the two biggest players of the group, PNG and Fiji, announced a raft of co-operative measures. Among these was the free movement of the citizens of the two countries in a new visa-free regime, a scheme to tap into the retired Fijian civil servants’ talents and experiences in a measure to help build civil service capacity within PNG and other such initiatives. Last month’s meeting of the group member nations’ trade ministers in Fiji appears to have been a further step in strengthening these relationships and trying to develop a common, shared vision for their mutual well-being. Some of the pronouncements at the meeting underscore the new confidence—even perhaps a bit of cockiness— that economic success has bestowed upon these countries. One of the more dramatic public pronouncements made at the meeting was by PNG’s Trade Minister Richard Maru. He said his

8 Islands Business, June 2013

country was considering opting out of PACER (Pacific Agreement on Closer Economic Relations) Plus negotiations. The announcement was not wholly unexpected, though. Discontent at PACER’s provisions, its lackadaisical pace and the view among MSG member nations that the deal is heavily skewed towards Australia and New Zealand has steadily gained ground. Fiji appears to share PNG’s views on PACER going by the speech of its own trade minister and the fact that Mr Maru alluded to this while speaking to the media. MSG leaders have instead pledged to consolidate trade among their own member nations by putting in place a duty-free regime, working towards a tariff-free common market. The leaders envision a “common economic union” and a “single common market” with the “free movement of goods, services, labour and capital,” as outlined by Fiji’s trade minister during the meeting. Rising economic indicators point to robust growth in the MSG region on the back of continuing big ticket investments in the resources sector such as LNG in PNG and both offshore and onshore energy and minerals exploration in the exclusive economic zones of most of the member nations. There is indeed a lot going in favour of the Melanesian nations compared to their Polynesian counterparts. They form 98.8 percent of the region’s total landmass, 30.3 percent of its exclusive economic

WESAY zones, and 87 percent of the region’s population. As a sub-region, these figures put Melanesia light years ahead of Polynesia and Micronesia in terms of potential for growth, not to mention the resources wealth of Melanesian nations. Tourism, whose potential so far has been PNG to opt under-utilised in Melanesia compared to Polyout of PACER nesian countries, which almost solely depend on negotiations? that singular activity other than remittances for their foreign exchange earnings, is also sure to add sizably to the Melanesian national incomes in the coming years. The investment in this sector is potentially large, given their relative proximity to markets like Australia and the fast growing cruise industry. As well as alluring landscapes, Melanesia has much cultural diversity and historical heritage sites to attract a broad range of international tourists. It is undoubtedly the real possibility of all this potential growth in the coming decades that has emboldened Melanesian leaders to not just think of but also voice their opinion on the possibility of moving away from traditional trading and development partners like Australia and New Zealand. The PNG trade minister’s pronouncement had a tone of cockiness in it as he expounded the virtues of a fast developing Melanesian union while at the same time undermining trading relationships with ANZAC nations. While the newfound and increasing confidence in their own fast growing economies and their rich resources is to be encouraged and praised, Melanesian leaders need to tread carefully when it comes to dealing with the strong, traditional trade relations that have been

established over several decades. It would be premature on their part to break off long-standing trade relationships with Australia and New Zealand. This is even if they increasingly appear to be skewed in favour of the Western nations, what with the MSG discovering and developing its own financial muscle. The Melanesian nations’ intentions to build their own trading bloc and make it stronger with exemplary co-operation between member states may be laudable, but there is still a long way to go before this can be satisfactorily achieved. Also, global trade is a reality of modern times, without which no economy can be sustained. It is therefore not advisable to display hawkishness towards any trade bloc, much less existing linkages. In other words, in an inter-dependent world, any trading bloc— particularly an emerging one like the MSG—must eschew posturing that is likely to depict it as a less than friendly entity to do business with, even if it feels short changed by past relationships, in which it perceives some trading partners as having had an upper hand because of a higher economic status, and historical reasons. The leaders need to do better than to vent frustrations and express hurt feelings in a bid to stake their claim to a level playing field. Instead, the Melanesian leadership must re-engage with these traditional partners from a position of greater strength, leveraging their newfound economic status and the proven potential of achieving growth rates that are a dream for much of the world’s developed nations. In any case, the sheer stream of business delegations from Australia and New Zealand beating a path to their door, particularly in the case of Papua New Guinea, is testament to the fact of how important Melanesia has emerged as a business destination for these countries. Melanesian leaders should put this to their advantage.

‘There has to be a concerted move for shifting the power of agriculture away from the stranglehold of industrial giants...If not, the numbers of people going to bed hungry each night will only increase from the estimated one billion at present—which is a shame in the face of all the touted economic progress that human-kind is supposed to have achieved’

n their race towards achieving increasing economic growth and sustaining it through frenetic industrialisation, countries around the world have neglected certain fundamentals that have long been the bedrock of human economic activity from times immemorial. One of these activities is agriculture. Growing crops, vegetables and fruit has been among human-kind’s oldest economic activities. Its role in developing and sustaining human civilisation is often understated.

This is mainly because this ancient, self sustaining human activity has lost its lustre in the face of industrialisation’s relentless march across the globe as the main driver of economic growth. In the past 200 years, industrialisation has become the Holy Grail for countries around the world to follow, delivering economic prosperity and raising living standards higher and higher. Increased investment in industry by countries has indeed delivered rich dividends to their people but it is only in the past few decades that the cost at which these spoils have been distributed Islands Business, June 2013 9

WESAY has begun to be calculated. Industrialisation has come at a tremendous cost to the environment. Man’s ferocious pursuit of industrial growth has in many cases used up the world’s non-renewable resources in wastefully unsustainable ways. This has not only put pressure on any remaining resources by driving prices up and causing political instability, but in some cases threatens to disrupt activities that are fundamental to the future of human beings on the planet. For one, industrialisation has made less and less land available for agricultural activity over the past several decades. Growing populations and rapid urbanisation around urban centres have expanded human habitations into farmlands and forests. This has left a progressively diminished body of land available to cultivate crops, which in fact should have been the opposite because of populations growing at rates never before seen in the world. Industrial activity has grown unhindered and unfettered by regulation designed to limit environmental degradation, which by and large came into reckoning in the latter decades of the last century. This has led to large scale pollution of habitats small and big—more often than not irreversibly—threatening a range of life forms besides humans across the planet. The rapidly rising rate of species endangerment and extinction because of severely and irreversibly polluted habitats, wildly variant climate patterns affecting crop production on almost every continent, the disappearance of fish stocks in the world’s oceans and the consequent threat to diminishing quality of life have all been blamed on mindless and irresponsible industrialisation. The unending quest for more of the world’s natural resources and the pursuit of economic growth as the only yardstick of success have formed the agenda of nations the world over.

The business of growing food

Putting resource intensive concepts such as these at the heart of the agenda of industrial growth has affected mankind’s oldest self sustaining activity tremendously in the past 70 or so years: the art and the business of growing

food. The decline of sustainable, small holder agriculture, which has helped humankind flourish for millennia does not get the attention it deserves. Industrialisation has taken agriculture away from small individual and community growers and placed it squarely into the hands of big corporate enterprises that own highly intensive super farms and depend greatly on elaborate supply chains for delivery to end users. This whole super farm concept has been built on the assumption of cheap fossil fuel as was the case when it took root in the years immediately following World War Two. Fuel in recent decades has been extremely unstable as far as prices and supplies go and this has driven up the prices of food around the world, in many cases to unaffordable levels. There are several poor countries in the world where the cost of food comprises more than 60 percent of a family’s income, leaving little for other important human needs. This has caused food riots in the past and will increasingly do so in future. Industry’s response to such crises has been to produce ever increasing quantities of processed foods laden with empty calories, high sugar and salt, harmful preservatives to increase shelf life and to facilitate bulk transportation. This has undoubtedly made food cheap, but its quality has plummeted while at the same time skyrocketing the rate of life10 Islands Business, June 2013

Living sustainably in Ontong Java...Statistics bear testimony that the region is now becoming one of the most obesity stricken areas in the world. Photo: Julian Maka’a

style diseases where none existed barely a couple of decades ago. The Pacific Islands region is a prime example of this. Once completely self sustaining, government and private investment in agriculture has precipitously declined, people have moved out of the business of growing for themselves and for profit and increasingly rely on cheap, largely unregulated imports of unhealthy canned foods for their daily needs. Statistics bear testimony to these facts what with the region now becoming known as one of the most obesity stricken areas in the world. Corporatisation of the food growing industry has also brought in new trends that put small farmers and agriculturalists at the mercy of powerful and rich global corporations. Many of these have promoted genetically modified foods with plant varieties that cannot propagate themselves. So farmers need to buy seeds to plant every new crop cycle. This is a recipe for killing whatever small agricultural practices, which have managed to survive the onslaught of big industry into farming coupled with the lack of interest and capital in promoting agriculture on the part of governments and small private sector enterprises. It is hardly surprising in this scenario that in places like India, which have traditionally survived as agriculture-based economies, farmers are ending their lives due to indebtedness in such large numbers every year. According to estimates, more than 200,000 farmers have committed suicides because of indebtedness in the past couple of decades, which indeed is an alarming situation by any standards. Drastic action needs to be taken to save agriculture and put it back in the hands of more smallholders around the world. Traditional agrarian communities need to be revitalised with increased investment and innovative, sustainable techniques backed with proven scientific concepts. There has to be a concerted move for shifting the power of agriculture away from the stranglehold of industrial giants. If not, the numbers of people going to bed hungry each night will only increase from the estimated one billion at present— which is a shame in the face of all the touted economic progress that humankind is supposed to have achieved. • We Say is compiled and edited by Laisa Taga.

Whispers Diplomatic charade: Social events can produce unexpected results. Like the senior diplomat who before he delivered his address, had to plead with his audience—comprising islands politicians and senior civil servants—that he was merely reading what had been written for him by his bosses in Europe, then quipping, ‘please don’t shoot the messenger’. In a similar get-together not too long before this one, an official cocktail did not end until the wee hours of the morning at a very exclusive resort in Fiji. Excuse given was that the host of the party stayed until 4am, so protocol demanded that invited guests which included some heads of government could not make an early exist. Interesting to see what the cocktail bill was like and who paid for the extra hours of fun? Whispers hope it is not the taxpayers footing the bill!  Talking about diplomats…a head of a diplomatic mission in one of the Pacific countries had to make a swift exit after claims he was abusing his local staff. It came to a head after one of his local staff lodged a report with the police claiming to have been punched by the diplomat. Whispers has been reliably told the diplomat was hauled before the local foreign ministry for a warning, but despite that, he continued to harass his local staff. In fact ,when he got wind of his masters’ move to get him back to his country, he tried to apologise to the foreign ministry but was too late. Whispers hears the diplomat was let go by his foreign ministry.  Aust losing it? Interesting speech made by a former head of the Aussie foreign department,

Richard Woolcott, who spoke on the topic Indonesia and Australia in the Asian century…and particularly his reference to Australia: “In this rapidly changing world, we need to put outdated Cold War thinking behind us. Australia needs to decide whether it wants to cling to a historic past or be actively engaged in Asia’s future. I believe we need to develop a more comprehensive and integrated strategy for the future and then secure bipartisan political support and much wider public acceptance of the strategy. I have some concern that in this changing world Australia is losing ground. At present, Australia brings to my mind an image of a marathon runner, carrying a 10-kg backpack. We can see some neighbouring countries pulling ahead of us and at present, because of our turbulent political situation, we seem unable to increase our pace. One can only hope that once the general election in September is behind us, the incoming government will focus on how Australia can increase its productivity and reduce the obstacles to our engagements. I recall when I was posted in Moscow travelling by train on the Siberian railway between Omsk and Kharborovsk and listening to two Russians talking about the future of the Soviet Union. One said, “we are building a new communist society”. His more cynical and realistic companion replied “yes, only in the media”. This remark 50 years ago has a resonance for me in Australia today.”  Fish deal: They may not be so popular in some regional circles, especially east of the international dateline, but the Parties to the Nauru Agreement came to the islands’ rescue at a recent fisheries talk with the Americans in Honiara. Forum countries had apparently agreed on having one of their Polynesian members to be the lead negotiator but

Fly High with Air Niugini

when talks stalled, PNA members were asked to intervene and take over. Took over they did, and much to their credit, refused to give into the US’ strong negotiating tactics and forced Washington re-consider the money it was dangling. Word is the transitional fisheries treaty with the US is only applicable for 18 months now, as negotiations continued.  Fiji for meetings? Fiji re-stamped itself as the place to be when it comes to regional and international meetings in the past few months. Not only did it play host to important regional meetings in trade for the Pacific ACP bloc but for the MSG alliance as well, and for the first time it entertained eminent personalities belonging to the Group of 77 plus China, a powerful lobby group of the developing countries of the world that Fiji currently chairs. Attending his first meeting in the South Pacific, a South American leader apparently left the country after whipping up a whooping F$10,000 shopping bill at Nadi Airport’s duty free shops. And no worries about the excess luggage. The South American leader had his own private jet waiting for him.  Business or pleasure? The question popped up when images were released of the party from Fiji’s national airline that travelled to France recently to take delivery of the second of three Airbus wide-bodied aircraft on order from the French manufacturer. At least for one of them, the trip was purely business. The whisper is that the national airline’s domestic cum regional subsidiary is eyeing the purchase of an ATR 72. Some say the new plane, larger than ATR 42 and INFLIGHT WITH AIR NIUGINI VOL 5 2012

INFLIGHT WITH AIR NIUGINI VOL 6 2012

INFLIGHT WITH AIR NIUGINI VOL 1 2013

INFLIGHT WITH AIR NIUGINI VOL 2 2013

“Paradise”, the inflight magazine of Air Niugini, is published every two months and is the only magazine placed in every seat pocket on all Air Niugini international flights. Each edition of the magazine carries a range of interesting articles about Papua New Guinea and Air Niugini’s destinations. They cover Papua New Guinea people, places, business and culture. The magazine is enhanced by the calibre of advertisers it attracts. If you want to be a high flyer with Air Niugini, contact us today and make sure of the promotion of your business aboard every Air Niugini flight.

For all your advertising requirements contact: Sharron Stretton Advertising & Marketing Manager PO Box 12718, Suva, Fiji Islands Tel +679 3303108 • Fax: +679 3301423 • Email: advert@ibi.com.fj

Lift your business with Paradise Magazine Islands Business, June 2013

Air Niugini celebrating 40 years of flying the flag for Papua New Guinea

Whispers

Advertising & Marketing Manager Sharron Stretton Advertising Executive Abigail Covert-Sokia Islands Business International Ltd. Level III, 46 Gordon Street PO Box 12718, Suva, Fiji Islands. Tel: +679 330 3108. Fax: +679 330 1423. E-mail: Advertising: advert@ibi.com.fj Circulation & Distribution Liti Tokona ltokona@ibi.com.fj subs@ibi.com.fj Sandiya Dass sdass@ibi.com.fj

China, here we come...Fiji Prime Minister Voreqe Bainimarama (second from left) with his delegation during bilateral talks with Chinese President Xi Jinping in China last month. While in China, Bainimarama also met with the vice-president of Huawei Technologies, a leading ICT company in China and ranked among the top ICT providers around the globe. Photo: Fiji’s Ministry of Information

more popular, should be on its delivery flight as early as November this year. Currently flying 2 ATR 42, the bigger aircraft should heighten competition on the regional routes of Port Vila and Nuku’alofa, observers say.

matter to the Land Transport Authority to resolve, citing success via this channel in similar recent instances. Whispers feels for bus commuters, who must spend more time and money to recover a nominal amount.

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Diplomatic blunder…Taxpayers of a foreign nation have been made to pay for the blunder of one of their so-called civil servants. Realising that a mistake was done in the recruitment of a particular officer in one of their foreign offices, this said office, it is whispered, has gone into damage control mode. The current post has suddenly been upgraded with a fatter salary and more perks, so immediately, the incumbent is no longer qualified for the ‘upgraded’ position. The officer will therefore make a quiet exit, allowing the foreign employer to hopefully recruit the right person for the job. You have to marvel at the great lengths some people go to cover-up for their mistakes!

Sailing in style…Guess what? Outgoing Group CEO of BSP Ian Clyne is finishing off from Port Moresby on a high note. He told Whispers he will be flying to Darwin to meet his yacht which will be sailing from Port Moresby, and from there sail home to Perth. According to bank staff, his farewell function in Suva was emotional. Whispers understands he could be venturing into another banking initiative with his contacts and links in Washington DC. We wish him the best.

 Bus card saga continues…More problems with Fiji’s bus card system A bus commuter was overheard complaining to an attendant at a Vodafone outlet in Suva about being charged twice for the same trip on her new bus card. The attendant was polite and explained that Vodafone was only providing the platform for Fiji’s new bus card service and that the problem lay with some bus drivers, who were deliberately overcharging patrons as a means to sabotage the new system. He went on to say that these drivers preferred to handle cash as this would allow them to dip into the day’s takings, one of the things the new system is meant to do away with. As a solution, the attendant suggested the customer take the

Regional magazine sales agents Pacific Cosmos – 89 Brisbane Street, Oxley Park, NSW, Australia Pacific Supplies – Cook Islands Yap Cooperative Association – Federated States of Micronesia Hachette Pacifique – French Polynesia Kiribati Newstar – Kiribati One Stop Stores – Kiribati Robert Reimers Enterprises – Marshall Islands Pacific & Occidental – Nauru South Seas Traders – Niue Nouvelle Messageries Caledoniennes de Presse – New Caledonia Wewak Christian Bookshop – Wewak, PNG Boroko Foodworld – Boroko, PNG

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UPNG Bookshop – Waigani, PNG

Who is to blame? So the President of Nauru uses the state of emergency to release funds for urgent issues like supplies for the hospital and overlapping the budget process on the delay in dissolving parliament. Whose fault was that? Parliamentarians boycotted a large part of the May sitting and the President himself was reported to be off the island most of the time. Voters have a chance to find out who was responsible for this delay and address that issue in the upcoming poll which has been brought forward from June 22 to June 8. It could become an expensive affair. Nauru’s acting Chief Secretary Bernard Grundler says the June election could cost as much as A$40,000.

Lucky Foodtown – Samoa Wesley Bookshop – Samoa Panatina Chemist Ltd – (Honiara) Solomon Islands Officeworks Ltd (Panatina Plaza - Honiara) Solomon Islands Friendly Islands Bookshop – Tonga Tuvalu Air Travel, Shipping – Tuvalu Trade and Consultancies – Tuvalu Stop Press – Vanuatu A year’s subscription to 12 issues of Islands Business within Fiji costs $50 and includes a complimentary copy of Fiji Islands Business.

Islands Business, June 2013 13

Pacific Update

Insecurity looms as RAMSI pulls ou By Alfred Sasako

t was Sir Peter Kenilorea, then Prime Minister, who declared at the flag raising ceremony outside the United Nations’ Headquarters in New York that as of July 7, 1978 Solomon Islands stands equal with all the other UN members. That was when Solomon Islands gained political independence from Britain after 83 years. Things were looking up. But that was then. In the 35 years since, the nation had gone through a rather tumultuous period, which culminated in a coup that has changed the political, economic and social landscape of this once idyllic South Pacific archipelago. Today, a multi-national regional force, which, a decade ago came to restore law and order is preparing to leave. As the deadline for the July pullout edges closer, there’s an eerie kind of feeling within that trouble is once again on the horizon. “You can feel it in the air, can’t you?” one senior public servant told me. Such a view is not unfounded. In fact, the feeling of insecurity is sweeping the nation that the departure of the Australia-New Zealand sponsored Regional Assistance Mission to Solomon Islands (RAMSI) will leave a vacuum the nation’s police force will be ill-equipped to deal with. Outward signs are that governance is not holding up in every sector. In the nation’s urban centres, law and order appears to be on the verge of collapse. Take for example the case of two men on Malaita whose arrests were ordered by the court more than two years ago. They are still on the loose. In May, the two were seen having a betel nut lunch with police officers who knew that warrants of arrests were issued for the two men since 2011. But they were never touched. Police were unable to arrest the two men because the criminals were armed and police were not. A local businessman known for systematically misleading the High Court on landownership and other issues is allegedly using the two men to

engage in criminal activities in the logging industry. “They have terrorised and threatened to murder our employees,” a representative of an Australian company engaged in the development of rural agriculture plantations on Malaita, said. There were unconfirmed reports these criminals even have dynamite amongst the cache of weapons they have at their disposal. “They want to RAMSI work on display...for all to see. Photo: RAMSI blow up the company premises, fuel and equipment,” the Australian firm were removed, the company’s water supply line was representative, who wished to remain unnamed, cut, a fuel tank was slashed and two large solar pansaid. els removed. Sadly, not only is the businessman using the The difficulty local police have in dealing with criminals, he handpicks rogue police officers from the criminals is that hundreds of guns including Honiara and Auki without authorisation to help sub-machine guns and ammunitions stolen from these criminals in their activities. Three of the ofthe Rove police armoury on the night of June 5, ficers are related to the businessman and are said to 2000 are still in the hands of the so-called ex-milbe on Prime Minister Gordon Darcy Lilo’s security itants. details known as the VIP Police Protection Unit. It is feared that the moment RAMSI leaves SolWhether the Prime Minister is aware of their inomon Islands, law and order would collapse and volvement, no one knows. criminals would take over. In May for example, five police officers used a These fears are compounded by claims in May falsified High Court order to supervise the crimithat corruption which stemmed largely from illegal nals in removing heavy equipment and machines dealings in the forestry and logging industry sectors from the company’s camp. Each police officer was have permeated even the nation’s judiciary. paid SB$5,000. An Asian businessman tricked into This prompted the industry to call for a total buying the machines and logs for more than SB$1 clean-up of the judiciary, saying unless this is dealt million almost suffered a heart attack when shown with promptly, the bad guys would take over. Furcourt papers that he had been conned. thermore, industry sources warned that the web of A few days after the machines and equipment

French Polynesia on UN decolonisation list

he United Nations General Assembly (UNGA) has voted to place French Polynesia back on the UN list of territories that should be decolonised. And it has requested the French Government to “facilitate rapid progress […] towards a self-determination process.” Adopting a consensus resolution tabled by Nauru, Tuvalu and Solomon Islands, the UNGA affirmed “the inalienable right of the people of French Polynesia to self-determination and independence” under the UN Charter, and declared that “an obligation exists [under the Charter] on the part of the Government of France, as the administering power of the territory, to transmit in14 Islands Business, June 2013

formation on French Polynesia.” The UNGA’s action places French Polynesia back on the UN list of non-self governing territories, bringing the number of inscriptions to 17. Meanwhile, President Gaston Flosse has denounced the UNGA decision to reinscribe French Polynesia on the UN list of territories to be decolonised, describing it as dictatorial and vowing that he won’t ever let the UN flag fly on his palace. The vote in New York, which was boycotted by France, came in the dying hours of the presidency of Oscar Temaru, for whom it was a last minute political win after a personal campaign of more than 30 years. —PACNEWS

Death for drug crime

he Papua New Guinea Government is considering imposing the death penalty on people who produce home brew and cultivate marijuana, police minister Nixon Duban says. He told a gathering in Ramu, Madang, last month that home brew and marijuana had contributed to the deteriorating law and order situation in the country. “People who produce home brew and cultivate marijuana will be put to death,” Duban, who is also the Madang MP, said. “The government is looking at ways to implement the death penalty.”

ulls out

Leaked report reveals resource curse By Jason Brown

corruption is forcing foreign investors to look elsewhere as the cost of doing business in the Solomons is becoming prohibitive. In the nation’s health sector, the story is the same. The system is crumbling under the weight of increasing demands for services, particularly in the urban centres. The National Referral Hospital, otherwise known as Number 9, now records an overage of four deaths a day from preventable causes. Outside the Taiwan-built hospital, the scene resembles a can of sardine. The sick are left lying on bare concrete, some times for hours, waiting to be attended to. Space, it seems is a rare commodity. A contributing factor is that government doctors have been allowed to set up their own private clinics in the hope of easing overcrowding and cutting waiting time. The opposite is true. “Doctors engaged by the government appear to spend more time in their private practice than at the hospital during official hours,” one official complained. In the rural areas, the situation is even more pronounced. Some hospitals have gone without doctors for months. Atoifi Adventist Hospital in East Kwaio on Malaita is a classic example. When the Peruvian doctor working there went on annual leave, the hospital was without a doctor for more than six months. In Temotu Province in the nation’s east, the hospital in Lata was without a doctor for some time after its doctor took his own life earlier this year, reportedly because of stress. RAMSI’s departure is also having an impact on businesses, resulting in some having to shed staff. “It’s something no one wants to talk about, but it is happening,” one businessman said. One sector expected to take a direct hit is the real estate industry, which had flourished during RAMSI’s 10-year presence, with monthly house rentals of up to SB$40,000 a month. “This no doubt will start coming down,” one industry representative said. But this should stabilise quite quickly as there other programmes that will take care of things,” she said.

drug crimes’ in PNG? He said a proposed legislation was being reviewed by the National Executive Council and would be implemented if approved. “People who spy around on our mothers and young girls will be hanged or face the firing squad. “There are too many lawless people in the country. This will teach them a lesson,” the police minister said. He said the urgency to implement the policy came from the people themselves after many women became victims of violent and horrific crimes in recent times. —PACNEWS

thnic tensions in the Solomon Islands are somewhat different today from the famed troubles that began 20 years ago. “Australians are rude and arrogant,” a Honiara resident told Islands Business. “We prefer Kiwis.” An unintended consequence of peacekeeping efforts has given the people of the Solomon Islands someone else to loath than each other. Due to start pulling out after 10 years under the RAMSI scheme, Australian forces once numbered some 2,000 plus personnel, now down to the dozen. Public polls run by RAMSI paint a different, rather glowing picture and no doubt it’s true that, as polled, foreign forces were very welcome relief from armed gangs that raped, tortured and killed during what is now called “The Tensions.” But if familiarity breeds contempt, it’s also not clear what lasting change has been achieved after more than US$1 billion paid out to the Regional Assistance Mission to Solomon Islands and, of course, counted as aid. A report quoted by opposition staffer Ashley Wickham on the DevPolicy site outlines much of the same conditions that existed before 1999. A government dominated by Central MPs who focus on village payments to get re-elected, rather than making decisions in the national interest. He cites a US$200,000 donation to a cultural community as an example of myriad projects with no auditing or other accountability—the money simply disappears. Wickham aims high as well as low, at the visible and “invisible hands” controlling development in the nation’s economy. “I believe the Solomon Islands government is abrogating its responsibilities and sitting back and watching donors (development partners) carry out the necessary investment in development. Is it because Prime Minister Darcy Lilo subscribes to the laissez-faire mind-set or has he been forced into this position by donors?” Laissez-faire mind sets form the modern origins of the Solomon Islands, a country named after a biblical king and his mythical gold mines, when a European explorer found alluvial gold sediments in the huge, flat river beds that snake their way through the biggest of about 1,000 islands. Hundreds of years after those early venture capitalists, foreign miners have invested some US$150 million in Gold Ridge, 30 kilometres south of the capital. Government is predicting that mining will soon replace logging as the country’s leading export industry. Potential returns can be seen in a 1999 figure from the US Geological Survey Yearbook of 2000 showing 3,456 kilogrammes of gold output, worth nearly US$160 million at today’s market value, with an expected mine life of 10 years. In 2000, of course, the mine closed as civil unrest closed in and biblical blessings turned into a resource curse. The mine did not reopen until 2010. Three years later, there is little evidence that miners have learnt many lessons, paying landowners and government 1.5% each in royalties. Critics compared these royalties with an example

from the Lihir gold mine in Papua New Guinea. There, an additional 30% share of the national special support grant given to the Lihir provincial government goes to the landowners, under an Integrated Benefits Package negotiated directly with foreign miners. In addition, the Lihir local government gets one million kina yearly for a village development scheme. Back in the Solomon Islands, foreign owners expect to end up extracting $1.5 billion from the Guadalcanal mine. Of that, just $45 million will stay onshore. Guadalcanal landowners have already started protesting, in 2011 and again early last year, blockading a road to the mine and demanding US$5 million in compensation for environmental damage. Solomon Star newspaper reported that the mine representatives attempted to deny there was a protest until they were shown photos—and then refused to comment. But it’s a leaked report from the Solomon Islands TRC (Truth and Reconciliation Commission), that shows the true state of denial surrounding realities behind the so-called ethnic tensions. Held back for the last 14 months by Prime Minister Darcy Lilo, the TRC report was leaked in late April by one of its final editors, long-time Malaita priest Bishop Terry Brown. At 332 pages, the report zeroes in on media descriptions of ethnic tension as the underlying cause of the five-year conflict. “There is uneasiness amongst some commentators that the Solomon Islands conflict is termed as ‘ethnic tension’. “They argue that defining the conflict along ethnic differences is too simplistic and does not contribute effectively to its resolution because it detracts from the real causes of the conflict, insisting that these lie in broader socio-economic and political issues.” Violence started towards the end 1998 with the eviction of settlers from Western Guadalcanal, notes the report. “Since then, a number of studies have identified a set of underlying ‘root causes’ such as colonial heritage, lack of national unity, disagreement over land issues, uneven development, mismanagement of successive governments, economic crisis, and/or the weakening of traditional authority structures and law enforcement mechanisms, which finally culminated in an ‘ethnic discontent’ among many Guadalcanal people.” Commission members both reject and accept “ethnic tensions” as a useful term. “Sustainable peace in Solomon Islands requires without doubt a well-balanced distribution of development investment and political institutionbuilding; but it also requires the overcoming of prejudices and indifference.” Lilo accused Brown of acting “illegally” in leaking the report. The bishop’s supporters countered by saying that the government had already broken the law governing the commission, which required that the report be tabled in parliament. Sensitivity is said to centre on a comprehensive list of compensation payments to hundreds of Solomon Islanders. Islands Business, June 2013 15

Cover Report

COSTLY NEMESES Solomon Islands...has copped major tsunamis and earthquakes in the past decade. This coastal village in Western Solomon Islands was left badly damaged after a major tsunami hit the country in April 2007. Photo: Islands Business

16 Islands Business, June 2013

Natural disasters could cost an average US$278m a year for PICs

By Dionisia Tabureguci

ear after year, earthquakes and tropical cyclones have battered a number of small islands countries in the Pacific region, some to such a degree that thousands of lives are lost and millions of dollars in damages are incurred. They have become regular visitors to the region, their tendency to disrupt national planning and put pressure on national budgets becoming as much a concern as their propensity to cut swathes through national population and bring untold trauma. Not surprisingly, scientific studies have categorised some of them as among the most vulnerable countries in the world when it comes to their exposure to natural hazards and indeed, while earthquakes and cyclones have been identified as the region’s two chief nemeses, the region is not spared from other forms like flooding, volcanic eruptions and tsunamis. As momentum increases in the region to address their ravaging impacts, a new research is shedding new light on just how exposed Pacific Islands Countries (PICs) are to earthquakes and tropical cyclones, projecting an average annual bill of some US$278 million for 14 PICs from damages they will sustain from these two forms of natural disasters. Known as the Pacific Catastrophe Risk Assessment and Financing Initiative (PCRAFI), the multi-donor-supported project is administered by the Secretariat of the Pacific Community (SPC) through its Applied Science and Technology Division (SOPAC). It uses a combination of historical data and new mapping technology to give vulnerable islands nations in the region improved tools for planning and preparedness.

Pioneering project “PCRAFI was started six years ago to assist Timor Leste and 14 PICs—Cook Islands, Federated States of Micronesia, Fiji, Kiribati, Nauru, Niue, Palau, Papua New Guinea, Republic of Marshall Islands, Samoa, Solomon Islands, Tonga, Tuvalu and Vanuatu— with managing risks from natural disasters,” World Bank’s senior country officer for the Pacific Islands, Robert Jauncey, told Islands Business. It is the bank’s pioneering initiative established for the Pacific in 2007. “It has been designed to provide countries with information and tools for risk assessment, disaster risk financing and most recently as of January this year, innovative disaster-related insurance solutions for five PICs. “This support is especially important for the Pacific, one of the most disaster-prone regions in the world, where natural hazards cause millions of dollars of damage and threaten the lives of tens of thousands of people. “Assessments conducted under the programme have found that the average annual cost from natural disasters is around 2% of Gross Domestic Product (GDP). National losses as a proportion of GDP are even higher for countries like Vanuatu and these costs take a major toll,” Jauncey said. By making available crucial data for each country—such as its population, its inventory on nationwide infrastructure, crops and buildings, their estimated value, how each country is placed in a simulation of historical natural hazards data for the Pacific region and the possibility of tropical cyclones and earthquakes hitting them over the next 50 years and how many lives are likely to be lost—the PCRAFI project has been able to give each Pacific islands nation a better picture of its exposure than was perhaps ever available to it. For instance, according to the individual country profiles, four PICs—PNG, Solomon Islands, Tonga and Vanuatu—are sitting on what’s known as the Pacific ‘Ring of Fire’, meaning they “geographically sit on the boundaries of tectonic plates, which are known to Islands Business, June 2013 17

Cover Report be very active seismic zones that can generate large earthquakes and sometimes major tsunamis that can travel great distances.” Vulnerable PICs While that increases their vulnerability as it puts them directly in a high-risk location, the rest of the PICs are equally vulnerable. Despite being in “quiet seismic areas”, they are surrounded by the Pacific ‘Ring of Fire’ and to varying degrees—interestingly with the exception of Nauru (see story on page 19)—each has had its fair share of tropical cyclones, earthquakes and tsunamis. PNG, the biggest landmass in this group of PICs and with a population of over 7 million, has historically been at the brunt of its default geographical location, perhaps suffering the most out of all PICs. “Many earthquakes caused deaths and destruction in Papua New Guinea in the last decades,” its PCRAFI country profile read. “A recent and tragic example is the 1998 magnitude 7.0 earthquake which struck in the north coast region near Aitape, triggering a large undersea landslide that caused a devastating tsunami with almost 2,200 fatalities and US$50 million in economic losses.” PHASE I & 2 PNG, it added, is located south of the In 2008, the first country risk profiles were equator at the north- developed for eight PICs by Air Worldwide and the World Bank under Phase 1. These profiles ern extremity of an were then improved and expanded to include area known for the additional data and country coverage under frequent occurrence Phase 2. Several key outputs were developed in of tropical cyclones Phase 2 including: • Regional historical hazard and loss database with damaging winds, for major disasters which contain a historical rain and storm surges earthquake catalogue covering approximately between October and 115,000 events of magnitude 5 or greater that ocMay. curred in the region between 1768 and 2009, and “Positioned as such a historical tropical cyclone catalogue includes within an area that 2,422 events from 1948 to 2008; • The hazard models, which include earthspans the equator to New Zealand in lati- quakes (both ground shaking and tsunamigenic) tude and Indonesia to and tropical cyclones (wind, storm surge and excess rainfall), have been peer-reviewed by east Hawaii in longi- Geoscience Australia who described them as tude, PNG is located “high standard, thorough and representative of in an area that has seen best practice.” • The regional GIS exposure database contains “almost 1000 tropical cyclones in the last 60 components for buildings and infrastructure, years, with an average agriculture, and population. For the building and infrastructure data set, more than 400,000 buildof about 16 tropical storms each year. “The northern part of the country is close to the equator where tropical storms are rarer. The southern part, however, was affected by severe cyclones multiple times in the last few decades. For example, tropical cyclones Justin and Guba in 1997 and 2007 respectively, caused between 180 and 260 fatalities; brought torrential rain that produced widespread flooding and landslides; and damaged buildings, infrastructure and crops with about US$300 million to US$500 million in losses combined,” the PNG country profile further read. PNG’s risk model under the PCRAFI project shows there is a 40 percent chance it will, over the next 50 years, experience at least one severe tropical cyclone which will be destructive enough to cause widespread damage and significant economic losses.

WHAT’S PCRAFI?

Costly exposure But PNG’s predicament in terms of projected economic losses pales in comparison with the other three PICs that sit on the Pacific ‘Ring of Fire’ and few others surrounded by it. The other three—Vanuatu, Solomon Islands and Tonga—and five 18 Islands Business, June 2013

others—Niue, Federated States of Micronesia(FSM), Fiji, Marshall Islands and Cook Islands are actually among the top 20 vulnerable countries in the world with the highest average annual losses from natural hazards as a proportion of GDP. That ranking, Islands Business was told, incorporated data from the PCRAFI modelling work and information from research conducted by the United Nations and World Bank for the production in 2010 of the publication Natural Hazards, UnNatural Disasters: The Economics of Effective Prevention. Under PCRAFI’s risk modelling, projected annual cost of damages sustained (in US dollars) by the eight PICs are: Cook Islands—$5 million (2.04% of national GDP); Fiji—$79 million (2.62 % of GDP); FSM— $8 million (2.78% of GDP); Marshall Islands—$3 million (2% of GDP); Niue—$0.9 million (5.6% of GDP); Solomon Islands—$20.5 million (3% of GDP); Tonga—$15.5 million (4.3% of GDP); and Vanuatu—$48 million (6.5% of GDP). It’s equally costly for the others. Kiribati is projected to experience an annual economic loss of $0.3 million (0.19% of GDP); Nauru— less than $2,000 (0.05% of GDP), Palau—$2.7 million (1.59% of GDP); PNG—$85 million (0.89% of GDP); Samoa—$10 ing footprints for structural classification were million (1.76% of digitised from high-resolution satellite images; G D P ) ; a n d Tu • Country-specific catastrophe risk models valu—$0.2 million have been developed for each country integrat(0.62% of GDP). ing data collected and produced through the risk In total, that’s modelling process and include maps showing the geographical distribution of hazards, assets at risk, roughly US$278 miland potential losses that can be used to prioritise lion a year bill for disaster risk management interventions; damages expected • Pacific Risk Information System includes from tropical cyclones the data and information captured in the database and earthquakes alone and makes them available in an on-line portal. It offers better risk information for smarter in all the 14 PICs combined. investments; PCRAFI’s risk • At the request of PICs during the Pacific Seminar of the 2011 World Bank/IMF Meet- modelling is also able ings held in November 2011, the World Bank to project cost over initiated Phase 3 of PCRAFI. The third phase of the next 50 years and the PCRAFI aims to provide further technical assistance to the PICs for the refinement of the the number of lives Pacific disaster risk assessment tools and embed- lost (see Country Risk ding the application of these tools into planning Profile box on page and budgetary processes. PDRFI is one of the 20) from impacts of activities under Phase 3 of PCRAFI. tropical cyclones and earthquakes. Source: Paula Holland, SOPAC To see that within the context of minimal, if not negative, annual economic growth in most countries in the Pacific, natural disasters do take their toll on the stressed government dollar already under pressure from inefficiency, corruption and wastage. Alongside natural hazards, these are common weaknesses in many Pacific economies. Understandably, tackling projected associated costs and being able to better plan around natural disasters using the wider range of information now available under PCRAFI would go a long way in saving monetary resources and lives. Financial solution To that end, project PCRAFI has been further developed to give governments in the Pacific not just technical data but financial solutions as well. “The Pacific Risk Information System (PacRIS) is one part of the PCRAFI programme which includes a regional geospatial database and country-specific catastrophe risk models and maps,” Jauncey said.

Cover Report Japan Insurance, Mitsui Sumitomo Insurance, Tokio Marine & “This provides governments and those institutions responsible Nichido Fire Insurance and Swiss Re. for managing disaster response with the tools and information they “AIR Worldwide provides the underlying risk modelling for the need to quickly assess damages following a disaster. For example, transaction. The pilot is being supported by the World Bank, Secreit has mapped an estimated 3.5 million buildings for vulnerability tariat of the Pacific Community and the Asian Development Bank to natural hazards. with financial support from the Government of Japan, the Global “In addition, PacRIS is informing the Pacific Disaster Risk Facility for Disaster Reduction and Recovery (GFDRR) and the EuFinancing and Insurance Programme (PDRFI). This insurance ropean Union,” pilot scheme aims said Jauncey. to help Pacific IsOut of the five lands nations—in PICs that have its pilot stage, the joined the pilot Marshall Islands, PDRFI insurance Samoa, Solomon scheme, four are Islands, Tonga and on the list of top Vanuatu—to de20 most vulnerliver an immediable countries. ate and effective These five join response when a as part of the Padisaster strikes, by cific Catastrophe allowing them to Risk Insurance access affordable Pilot component earthquake and of PDRFI. hurricane catasSaid Paula Holtrophe coverage. land, Manager “It relies on The aftermath...of the Samoa tsunami in 2012. Photo: Merita Huch Natural Resource state-of-the-art Economics and risk modelling Governance at techniques and is SPC: “The Pacific Catastrophe Risk Insurance Pilot is one part of the first ever Pacific scheme to use parametric triggers, linking imthe PDRFI programme and was launched in January 2013. It will mediate post-disaster insurance payouts to specific hazard events,” run for two years to test the viability of market-based catastrophe Jauncey added. risk insurance solutions in the Pacific. “Through the scheme, the World Bank will act as an intermedi“The objectives of this pilot are to: (i) test the credibility of the ary between the Pacific Islands nations and a group of insurance catastrophe risk models for market transactions; (ii) assess the risk companies selected through a competitive bidding process—Sompo

Nauru, safest place in the Pacific If the ‘safest place’ in the Pacific may be measured by how vulnerable each country is to natural disasters, then Nauru would have to be on top of the list as the ‘safest’. Information from the Pacific Catastrophe Risk Assessment and Financing Initiative (PCRAFI) database reveals Nauru as least exposed to natural disasters compared to 13 other Pacific Islands Countries (PICs) and the likelihood of it experiencing costly damage from earthquakes and tropical cyclones is almost zero. “Nauru is expected to incur, on average, less than US$2,000 a year in losses due to earthquakes and tropical cyclones,” PCRAFI says in its risk assessment profile for individual PICs. “In the next 50 years, Nauru has a 50 percent chance of experiencing no economic losses and no casualties, and a 10 percent chance of experiencing a loss exceeding US$0.2 million and no casualties.” PCRAFI, a multi donor-funded project implemented by the Secretariat of the Pacific Community (SPC) through its Applied Geoscience and Technology Division (SOPAC), is a result of seven years of multi-layered data collation for 14 PICs based on the history of natural disasters in the Pacific and the results have been

used to draw up risk profiles for each country. A revelation emerging from this is that Nauru appears the least exposed and has experienced no tropical cyclones nor earthquake or tsunami in the last 60 years, whereas others have had their share of these natural hazards, not one of them being spared. “In the Pacific region from Taiwan to New Zealand in latitude and from Indonesia to east of Hawaii in longitude, almost 2,500 tropical cyclones with hurricane-force winds spawned in the last 60 years with an average of about 41 tropical storms per year. “However, in historical times, none of these cyclones affected Nauru,” PCRAFI’s country risk profile for Nauru said. It could well be the safest place in the region, sheltered as it is in a “very quiet seismic area” although, according to SOPAC Manager Natural Resources Paula Holland, a low level of risk does remain for Nauru. “There are no historical records of disasters caused by earthquakes or cyclones in Nauru,” Holland told Islands Business. “While this does not mean that no risk exists, you can say that based on historical records, the country is very much less risky than others for these hazards,” Holland added.

Nauru’s prime location on the equator is seen as its saving grace, as this means it is “outside the belt of frequent occurrence of tropical cyclones with damaging winds, rains and storm surge between the months of October and May,” according to its risk profile. While significant wind speeds from local storms are possible in Nauru, they are not expected be strong enough to wreak damage to crops, buildings and infrastructure. The country is also spared from killer earthquakes and tsunamis, unlike the other 13 PICs and that again it owes to its location. “Nauru is situated in a very quiet seismic area but is surrounded by the Pacific ‘Ring of Fire” which aligns with the boundaries of the tectonic plates,” its country risk profile read. “These tectonic plate boundaries are extremely active seismic zones capable of generating large earthquakes and, in some cases, major tsunamis that can travel great distances. In historical times, no records of earthquake or tsunami damage in Nauru have been recorded.” In the next 50 years, the likelihood of Nauru experiencing at least one earthquake or tsunami is estimated under PCRAFI to be nil. —By Dionisia Tabureguci

Islands Business, June 2013 19

Cover Report

COUNTRY RISK PROFILES—Assessed 2010 COOK ISLANDS (population=19,800) The Cook Islands are expected to incur, on average, about US$5 million a year in losses due to earthquakes and tropical cyclones. In the next 50 years, the Cook Islands have a 50% chance of experiencing a loss exceeding US$75 million and casualties larger than 130 people, and a 10% chance of experiencing a loss exceeding US$270 million and casualties larger than 200 people. FIJI (population=847,000) Fiji is expected to incur, on average, US$79 million a year in losses due to earthquakes and tropical cyclones. In the next 50 years, Fiji has a 50% chance of experiencing a loss exceeding US$750 million and casualties larger than 1,200 people, and a 10% chance of experiencing a loss exceeding US$1.5 billion and casualties larger than 2,100 people. FEDERATED STATES OF MICRONESIA (population=112,000) The Federated States of Mi-

cronesia (FSM) is expected to incur, on average, US$8 million a year in losses due to earthquakes and tropical cyclones. In the next 50 years, FSM has a 50% chance of experiencing a loss exceeding US$105 million and casualties larger than 220 people, and a 10% chance of experiencing a loss exceeding US$470 million and casualties larger than 600 people. KIRIBATI (population=101,400) Kiribati is expected to incur, on average, about US$0.3 million a year in losses due to earthquakes and tropical cyclones. In the next 50 years, Kiribati has a 50% chance of experiencing a loss exceeding US$1 million and casualties larger than 10 people, and a 10% chance of experiencing a loss exceeding US$40 million and casualties larger than 200 people. MARSHALL ISLANDS (population=54,800) The Republic of the Marshall Islands is expected to incur, on average, US$3 million a year in losses due to earthquakes and tropical cyclones. In the next

appetite of international reinsurers for Pacific catastrophe risks; and (iii) test the viability of Pacific catastrophe risk insurance.” Holland oversees the resource economics programme at SOPAC. Insurance plan for PICs While the actual work on PCRAFI began in 2008, where in conjunction with AIR Worldwide, the World Bank developed country risk profiles for the Pacific as part of the heavily technical Phases One and Two, PDRFI is one of the activities under Phase Three of PCRAFI. Disaster Risk Financing Insurance is unlike conventional disaster insurance schemes because it is ‘parametric’, said Holland. “Conventional insurance requires an assessment of the costs an event causes before an insurance payout can be made. By comparison, parametric insurance is triggered by the occurrence of a specific event (eg: cyclone or earthquake). To determine whether a payment will be triggered under the DRFI, models of the scale of costs of events are used, not actual costs,” Holland added. In 2013, the aggregate insurance premium required by the five PICs amounts to around US$45 million and is being paid for by the Government of Japan. “Given the innovative structure of the pilot and the current budget constraints faced by PICs, the Government of Japan has agreed to co-finance the catastrophe risk insurance premiums for the first two years of the pilot operations. After this point, alternative sources of funding for premiums will need to be sought,” said Oliver Mahul, programme coordinator at the World Bank. The scheme, he added, is available to other PICs during the second year of the pilot, but they will have to pay their own premium. They still qualify, however, to take advantage of the technical assistance activities offered as part of the project. Natural disaster meets climate change It can be seen that through PCRAFI, PICs now have a clear idea 20 Islands Business, June 2013

50 years, the Republic of the Marshall Islands has a 50% chance of experiencing a loss exceeding US$53 million and casualties larger than 50 people, and a 10% chance of experiencing a loss exceeding US$160 million and casualties larger than 150 people. NAURU (population=10,800) Nauru is expected to incur, on average, less than US$2,000 a year in losses due to earthquakes and tropical cyclones. In the next 50 years, Nauru has a 50% chance of experiencing no economic losses and no casualties, and a 10% chance of experiencing a loss exceeding US$0.2 million and no casualties. NIUE (population=1,480) Niue is expected to incur, on average, US$0.9 million a year in losses due to earthquakes and tropical cyclones. In the next 50 years, Niue has a 50% chance of experiencing a loss exceeding US$15 million and casualties larger than 20 people, and a 10% chance of experiencing a loss exceeding US$60 million and casualties larger than 25 people.

of the economic loss they are likely to suffer from earthquakes and tropical cyclones. While these two forms of nature’s wrath may be their chief nemeses, climate change is another natural phenomenon that has gradually surfaced to be a grave concern. The impacts are perceived to have far reaching permanence to them that PICs might be better off if they had to deal with natural hazards alone. But climate change is as real in the region as natural disasters in the way that most of these small islands countries are positioned to suffer issues like population displacement, rising water level and food security alarm as a result of climate change. Because the line between Flooding in Fiji...a result of Tropical Cyclone Evan whic h hit the co climate change and natural hazards is blurring, there is a growing recognition in the region that they should be tackled together. In Phase 3 of PCRAFI, there are expectations that climate change will be added to the country risk profiles generated by AIR Worldwide and the World Bank, according to Holland. In July, in a first of its kind in the region and in the world, a conference in Fiji will merge two major regional conferences—one on

Cover Report

PALAU (population=20,500) Palau is expected to incur, on average, US$2.7 million a year in losses due to earthquakes and tropical cyclones. In the next 50 years, Palau has a 50% chance of experiencing a loss exceeding US$30 million and casualties larger than 45 people, and a 10% chance of experiencing a loss exceeding US$247 million and casualties larger than 175 people. PAPUA NEW GUINEA (population=6,406,000) Papua New Guinea is expected to incur, on average, US$85 million a year in losses due to earthquakes and tropical cyclones. In the next 50 years, Papua New Guinea has a 50% chance of experiencing a loss exceeding US$700 million and casualties larger than 4,900 people, and a 10% chance of experiencing a loss exceeding US$1.4 billion and casualties larger than 11,500 people. SAMOA (population=183,000) Samoa is expected to incur, on average, US$10 million a year in losses due to earthquakes and

Evan whic h hit the country late last year. Photo: SPC

tropical cyclones. In the next 50 years, Samoa has a 50% chance of experiencing a loss exceeding US$130 million and casualties larger than 325 people, and a 10% chance of experiencing a loss exceeding US$350 million and casualties larger than 560 people. SOLOMON ISLANDS (population=547,500) The Solomon Islands are expected to incur, on average, US$20.5 million a year in losses due to earthquakes and tropical cyclones. In the next 50 years, the Solomon Islands have a 50% chance of experiencing a loss exceeding US$240 million and casualties larger than 1,650 people, and a 10% chance of experiencing a loss exceeding US$527 million and casualties larger than 4,600 people. TONGA (population=103,000) Tonga is expected to incur, on average, US$15.5 million a year in losses due to earthquakes and tropical cyclones. In the next 50 years, Tonga has a 50% chance of experiencing a loss exceeding US$175 million and casualties larger than 440 people, and a 10% chance of experiencing a loss

climate change and the other on disaster risk management, narrowing the gap that exists between these two issues. Stakeholders expected to attend include representatives of regional governments, civil society, private sector, regional and international donor organisations among others. But what’s perhaps crucial is that regional institutions that have climate change and disaster risk management (DRM) in their portfolios, such as the SPC and the Secretariat of the Pacific Regional Environment Programme (SPREP), will be talking together on a common platform, that of DRM and climate change combined. “Preparing for natural disasters makes imminent sense as a precautionary measure against climate change,” said SPREP Director Gen-

eral, David Sheppard. “Some natural disasters are expected to be exacerbated or made more intense by climate change. As a result, SPREP and partners, particularly SPC, are working with PICs on linking work done on disasters as well as climate change. SPREP recognises the importance of integrating responses to climate change and disaster risk

exceeding US$430 million and casualties larger than 1,700 people. TUVALU (population=9,960) Tuvalu is expected to incur, on average, US$0.2 million a year in losses due to earthquakes and tropical cyclones. In the next 50 years, Tuvalu has a 50% chance of experiencing a loss exceeding US$4 million and casualties larger than 15 people, and a 10% chance of experiencing a loss exceeding US$9 million and casualties larger than 50 people. VANUATU (population=246,000) Vanuatu is expected to incur, on average, US$48 million a year in losses due to earthquakes and tropical cyclones. In the next 50 years, Vanuatu has a 50% chance of experiencing a loss exceeding US$330 million and casualties larger than 725 people, and a 10% chance of experiencing a loss exceeding US$540 million and casualties larger than 2,150 people. • Source: Pacific Catastrophe Risk Assessment and Financing Initiative (pcrafi.sopac.org)

management at national and regional levels. A concrete response to this has been the development of Joint National Action Plans (JNAPs) in a number of PICs, which integrate these key areas and also involve close and effective cooperation between SPREP and other regional agencies particularly SPC. There is also a series of regional meetings in Nadi from 1 to 11 July which will culminate in a joint meeting of the Pacific Platform for Disaster Risk Management (PPDRM) and the Pacific Climate Change Roundtable (PCCR) from 8 to 11 July. SPREP, SPC, UNISDR and other relevant agencies are working closely on this major event, which represents a first for the region and a first for the world,” Sheppard added. PICs may have at their disposable a very comprehensive technical financial solution package for natural hazards through project PCRAFI but being also on the line of fire from impacts of climate change, they have comparatively little to go on with. SPREP’s ambition to do something similar to PCRAFI in relation to climate change and the impact to PICs has been hampered by lack of resources while finances available to PICs through global climate change funds are difficult to access because of their stringent requirements. However, “there are numerous cost-benefit analyses that have been carried out by SPREP under the Pacific Adaptation to Climate Change Project that could contribute to this enhanced understanding of what climate change will mean for the region,” said Sheppard. For now, the closest to an integrated effort there is in the Pacific is the JNAPs in some PICs. “These have implementation strategies attached that seek to tackle immediate vulnerabilities as a common sense measure, while also planning more long-term measures against greater damages from climate change,” Sheppard added. “SPREP’s work on climate change adaptation through the Pacific Adaptation to Climate Change project also seeks to integrate responses to climate change across sectors and across the areas of climate change adaptation and disaster risk reduction.” Islands Business, June 2013 21

Politics

FRENCH POLYNESIA

Gaston Flosse (left)...back in power. Photo: www.radio1.com

Gaston Flosse tells big companies: ‘help the poor’ But ÔOld LionÕ faces uncertain future By Jason Brown GAston flosse sAys A Ays his Government in French Polynesia will start paying unemployment benefits of up to US$1100 a month. Flosse made the announcement last month, within days of being elected back into power. “To implement this, we will tax big companies with billions (of Pacific francs) in turnover per year.” “It is up to them to help the poor,” Flosse told Tahiti Nui Television, after winning nearly 41% of the vote. Such a measure would target businesses with revenues over US$10 million. Unemployed youth under 30 will get US$880 a month, while those over 30 get the larger amount. This adds to existing payments aimed at the elderly and young families, along with housing and other state support under the CPS, or Social Security Fund, with a budget of around US$130 million. Once considered a close ally of big businesses and the French state, Flosse reinforced populist themes by choosing employment and welfare as his first two portfolios. It remains to be seen whether Flosse can push through the benefit plan, or even stay in power. Nicknamed the ‘Old Lion’ in the French press Islands Business, June 2013

and fighting corruption charges, Flosse faces an uncertain future, despite winning 38 out of 57 seats. Ruling Socialist Party MP René Dosière described the election of Flosse as “shameful” for France. With the new Hollande government valuing “integrity and transparency in politics”, Dosière said, “it would not be acceptable that the old practices of corruption and theft of public money for personal use reappear in French Polynesia.” Flosse successfully turned frustration over a flat economy and fear of independence into a “grand victory” Facts may have got lost in the election, as they do. Latest figures from December 2012 show formal employment figures of 61,343—down from

a high of 66,273 in November 2005. Three years later, the global financial crisis struck hard at French Polynesia. Criticised for mishandling the economy, outgoing president Oscar Temaru appears to have minimised job losses to a lower percentage than many other countries. But, as opponents admitted, the Flosse fear factor won him the elections, held over two rounds. “His formula worked,” said Teva Rohfritsch, leader of the centrist A Ti’a Porinetia party. “Flosse promised much, including payments for unemployment and social assistance, under his theme: vote for me and everything will be as before. “Yet we all know that the situation today has nothing to do with the time of the nuclear tests”, Rohfritsch said, highlighting declines in subsidies from the state. Figures from ISPF, the Institute of Statistics for French Polynesia, show there were only 45,000 workers in 1996, at the time of the last nuclear tests, markedly lower than today. Election results show the differences between urban elites with access to newspapers, television and fast internet net links compared with the rural poor who have only a radio to go by. Social networking figures showed a huge swing among urban voters towards Rohfritsch, with 5,648 “likes”, more than the 662 for Flosse, and 1,184 for his Tahoeraa Huiraatira party put together—both outstripped Facebook likes for Oscar Temaru and his Tavini Huiraatira party, at around 1,700. However, like Temaru, Rohfritsch was unable to turn urban popularity into a national majority. Temaru was blunt. “Voters are dreaming. It is the politics of dependency that Flosse wants to continue practising, and that will push this country into ruins.” “With us, it is quite the opposite: we asked the people to make the effort to return to the land, roll up their sleeves and work.” Statistics back him up. Job losses in the first two months of 2013 continued at -1.6%—a much lower rate of decline than the -2.4% average of the previous five years. In the meantime, supporters of independence in French Polynesia were asking themselves: is the game over? Despite appearances from years of political instability, Temaru and Flosse are both masters of the long game, moving key chess pieces around the geopolitical board, sacrificing pawns along the way. For now, Flosse is assured of the presidency, with the first of his appeals to the French Supreme Court due to be heard late 2013 or early 2014.

Despite appearances from years of political instability, Temaru and Flosse are both masters of the long game, moving key chess pieces around the geopolitical board, sacrificing pawns along the way.

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Politics

NORTHERN MARIANAS

Foreign workers in the CNMI...might have the chance to become US citizens if a national immigration bill becomes law. Photo: Haidee Eugenio

US citizenship for long-term foreign workers? US Senate to discuss immigration bill By Haidee V. Eugenio S ome 25 years after arriving in the Northern Mariana Islands (CNMI) in 1988 to work as a stewarding manager for a major hotel, Danilo Villanueva, 58, may finally have the chance to become a U.S. citizen if a sweeping national immigration bill in the U.S. Senate becomes law. The landmark immigration reform bill is widely known for providing a pathway to U.S. citizenship to some 11 million undocumented immigrants in the United States. This makes it the most ambitious immigration reform bill in U.S. history in at least three decades. Section 744 will be debated in the U.S. Senate in June. Tucked in the bill’s over 800 pages is a CNMIspecific provision that allows long-term foreign workers to apply for and be granted CNMI-only residency within months of the bill’s signing into law. After a five-year waiting period, they can apply for and be granted U.S. permanent residency or “green card”. A “green card” is a pathway to U.S. citizenship. “Since the day I got here, I already heard about the push for improved status for alien workers. I have been working here for 25 years and nothing has happened. That’s why I’m not too excited but if this bill becomes law, then I would be very happy, my family would be happy,” Villanueva told Islands Business. Unlike other U.S. states and territories such as Guam, the CNMI does not grant “green card” to its legal foreign workers even after five, 10 or more years. 24 Islands Business, June 2013

This, even after the U.S. federal government took over control of CNMI immigration in 2009. On May 21, in Washington, D.C. (May 22 CNMI time), the U.S. Senate Committee on Judiciary approved the immigration reform bill by a vote of 13-5. That paved the way for the bill to be debated by the full U.S. Senate in June. Within hours of the committee passage, affected foreign workers were already rejoicing although they understand it still has to pass the full U.S. Senate and then the full U.S. House of Representatives before reaching President Barack Obama’s desk. CNMI Delegate to the U.S. House of Representatives, Gregorio Kilili Sablan (Ind-MP), said none of the U.S. Senate Judiciary Committee’s amendments changed the bill’s CNMI-specific provision. However, he remains “cautiously optimistic.” “Three Republicans joined 10 Democrats to support the bill that made no changes to the Northern Marianas’ provision after considering about 200 amendments. And if the bill clears the Senate, it will take even more work because the Republican House majority is not likely to take it up in its current form,” he said. The CNMI delegate continues to work with his U.S. House colleagues to include the CNMI provisions in a House bill if they can come to some agreement after four years of negotiations. “So a lot of work remains and I remain cautiously optimistic,” Sablan added. The U.S. Senate Judiciary Committee’s passage of the bill comes less than two years before the end of the federalization transition on Dec. 31, 2014. That’s when the CNMI will be forced to let

go of its over 12,000 foreign workers—unless the transition is extended to a later time. Most of the legal, long-term foreign workers in the CNMI are from Asian countries such as the Philippines and China. They have taken up many of the private sector jobs conceivable on the islands—nurses, teachers, engineers, architects, auditors, accountants, journalists, clerks, auto mechanics, electricians, carpenters, masons, beauticians, farmers, restaurant servers, hotel employees, and house workers—among other jobs. Celia Pillarina, 33, also a long-term foreign worker, said the CNMI-specific provision could have offered an easier path to citizenship by removing the additional five-year wait period for long-term “legal” workers in the Commonwealth once the bill is signed into law. Rabby Syed, of the United Workers Movement-NMI, said the CNMI’s long-term legal workers should not be treated the same as the “illegal” or “undocumented” immigrants in the U.S. President Obama praised the Senate Judiciary Committee’s May 21 action, saying the bill was consistent with the goals he has expressed. Obama has made the enactment of an immigration bill one of his top priorities for 2013. The bill not only would put the 11 million illegal residents on a 13-year path to citizenship but will also further strengthen security along the south-western border with Mexico, which has long been a sieve for illegal crossings into the U.S. Rene Reyes, founding president of the Marianas Advocates for Humanitarian Affairs Ltd., lauded the committee’s passage of the bill, adding that this was what they expected to happen—“as fast as what President Obama had in mind.” Florida-based human rights activist and former CNMI teacher Wendy Doromal said although she is not completely satisfied with the U.S. Senate’s provision about the CNMI, she shares Obama’s sentiments that this bill is “clearly a compromise and no one will get everything they wanted”. Doromal said once the CNMI-specific provision of the U.S. Senate bill is retained when the measure becomes law, it would allow foreign workers to travel without what she describes as “restrictive paperwork of the current CNMI-only immigration system”. There are six groups of aliens eligible for a CNMI-only permanent resident status: • First group: Those persons born in the CNMI between Jan. 1, 1974, and Jan. 9, 1978. • Second group: Those persons granted CNMI permanent resident status under CNMI immigration law. • Third group: The spouse or child of the first and second groups. • Fourth group: The immediate family members of U.S. citizens, regardless of age. • Fifth group: Foreign workers in the CNMI that were admitted under CNMI immigration law five years prior to May 8, 2008, and are presently resident under CW-1 status. • Sixth group: The spouse and children of individuals in the fifth group. The U.S. Senate bill, however, excludes eligibility for adjustment of status of those who are illegally present in the CNMI. Citizens of the Freely Associated States or those from Palau, the Marshall Islands and the Federated States of Micronesia’s Pohnpei, Chuuk, Yap, and Kosrae, are also excluded from eligibility to adjust status under this bill.

Politics

PACIFIC

China makes splashes in the Pacific

in leaps and bounds. Eager to raise the living standards of their own citizens, Pacific Islands nations with diplomatic relations with Beijing, in particular, are finding that China is an informidable economic ally. In the last seven years for example, Beijing has provided tangible projects in Forum Islands Countries that it has diplomatic relations with. It has offered in-kind support, grants and soft loans. In Samoa for example, a new state-of-the-art hospital would be officially handed over to the Tuilaepa government in September. The cost of and to a certain extent, the United Kingdom, and that single project alone is expected to exceed on the other, is China, the new kid-on-the-bloc US$100 million when it is completed. and rising economic and military power in the At the same time, it has built a huge office Asia-Pacific region. complex for the Prime Minister’s Office right China, otherwise known politically as the in the heart of Apia. Work has begun on an even People’s Republic of China (PRC), is flexing its larger office complex. new-found economic prowess by focusing on In agriculture, a Chinese team of experts has winning the hearts of the Pacific Islands nations. successfully piloted rice growing and other cash crops in town. China’s approach “They are now moving into the rural areas this It seems its approach is working. Here is why. year,” an Opposition Samoa MP told me during At a time when traditional donors appear fed up our recent visit to China. with Pacific governments largely seen as creator In nearby Tonga, Beijing is also making waves of economic mismanagement, China has picked as the two countries strengthen their bilateral ties. up the pieces and is offering never-to-be-refused The island kingdom will this year take delivery of two 50-seater aircraft for its domestic routes. Depending on its success, the Nuku’alofa government is planning to obtain two larger additional aircraft, possibly under a soft loan, for the kingdom’s regional network. Beijing has also just completed a US$25 million mansion named King George for the King. The same story is repeated in Fiji and in the larger Melanesian nation of Papua New Guinea, which has benefited enormously from China’s latest offerings of soft loans. Recently, the PNG The Pacific delegation...in China. Photos:Alfred Sasako government incurred the ire of the traditional donors when it borrowed US$500 million in soft financial packages. loans. This was part of the US$2 billion soft loan “Traditional donor facility China announced in 2006. allies of the Pacific are This year, the Peter O’Neill Government losing support because has just concluded a US$6 billion soft loan they are becoming more negotiations to develop PNG’s highways and and more stingier in other support infrastructure. By the time you what they give the Pacifare reading this article, PNG officials along with ic. They have attached representatives from engineering firms vying for far too many strings and the project would be arriving in Beijing to sign on conditions to their assisthe dotted line so that work can start. tance,” complains one “We are not going to use up all the money in senior Pacific diplomat one go, no. The draw-down will be on the needs in Beijing. basis as well as on stage-by-stage completion,” “China does not do one senior PNG official told me in Beijing in that. And that is why May. Beijing is winning At two percent interest on repayment, the loan hearts in the Pacific,” from Beijing is 1.25 percent less costly than the he added. US$25 million loan the Solomon Islands governChina’s help comes in the form of in-kind ment obtained from the Export-Import Bank of assistance, grants and soft loans. And they come ROC (Taiwan) to pay for the cost of properties

Focus? Winning the hearts of the islands By Alfred Sasako It’s not often that Pacific Islands Forum Leaders meet the Chinese leadership alone on Chinese soil. The exception is the annual Post-Pacific Forum Dialogue, which follows the Pacific Forum Leaders’ summit and is always held in the Pacific. But things have changed. In November, Pacific Forum Leaders will converge on China’s eastern coastal city of Guanzhou for the first Sino-Pacific Forum Leaders’ summit. Beijing is expected to use the opportunity to showcase the power of its growing economy. The world’s third largest economy will, among other things, announce a US$1 billion soft loan facility it is offering Pacific Islands governments during the three-day China-Forum Leaders’ summit from 9 November 2013, Chinese officials said. The hosting of the historic summit also heralds the advent of a new player in the game plan to, not only have a slice of the Pacific, but win the hearts of its citizens and governments struggling to make ends meet. Until the summit, we could very well just be guessing what else Beijing might have on offer. For now, though, it seems the game to win the Pacific

Solomons’ Leslie Kwaiga...prepares to enter a cave dwelling in Binxian County.

is on. On one side are the traditional donors such as Australia, New Zealand and the United States

Islands Business, June 2013 25

Politics and houses destroyed during the so-called ethnic tension. In nearby Vanuatu, the Chinese government has done even more. Apart from providing two passenger aircraft for the Francophone nation’s domestic airline, Beijing also lent the Port Vila government two loans totalling about US$60 million. Proceeds from these loans were used to build the USP Campus in Port Vila and the Parliament House, also in the capital. But Beijing went an extra mile. It forgave both loans, according to Vanuatu officials. China’s carrot-dangling approach is not strictly confined to FICs with whom it has diplomatic relations. Last month, Beijing through the International Department of the Communist Party of China hosted some 29 delegates from six Pacific Islands countries including Solomon Islands, which does not have diplomatic ties with the mainland. The two-week study tour was to showcase China’s approach to addressing poverty alleviation and development. Impressed “I am very impressed with China’s approach,” said Samoa’s Legislative Assembly Deputy Speak Speaker, Agafili Patisela Eteuati, after visiting one rural farm in Shaanxi Province in China’s south-west, “I think they’ve got the formula correct. The Pacific can learn a great deal from China,” he said. Only a few years ago, farmers in the province’s Binxian County which we visited were living in caves. Today, many of these farmers are living in brand new three-bedroom houses as the county of some 355,000 people lift the economic growth of this remote region. Its overall GDP now stands at RMB Yuan 13.62 billion (about US$2 billIon). It recorded a growth rate of 20.6 percent last year, according to presentations made by the local officials. Per capita GDP has also risen from almost zero to US$6,245 with disposal income for urban people at US$4,105 while the disposal income for people in the rural area is US$1,275. “We still have a long way to go but we have begun. We would like to share our experiences with our friends in the Pacific,” one senior Chinese official said. While China’s economic growth has been phenomenal, its banking sector has been hit by bad loans, which have to be written off. According to newspaper reports, China’s big four—which includes the Industrial and Commercial Bank of China (ICBC) and the Agriculture Bank of China (ABC)—were forced to write off some US$92 billion in bad loans. The bad loan itself has left quite a dent especially on the housing sector with lenders showing a cautious approach in investing there. This does not change the fact that Beijing has entered the arena and is ready to play ball. Yes, the game is truly on. And like the lyrics of the popular country and western number says, “It’s not whether you win or lose…but it’s how you play the game.” Thus far China seems to be lining up the winning cards in the right places, while western nations have allowed their greed to determine the way forward in this game. Needless to say, the traditional donors may need to change their rules and tactics or risk losing the Pacific and remain scoreless from hereon. Islands Business, June 2013

TUVALU

Tuvalu’s high court orders by-election to be held Nauru in a state of emergency

becomes necessary. “I cannot accept that the intention of the t he h iGh c ourt in t uvA uv lu definition of the phrase “as soon as practicable” has ordered the government to in section 88 is properly read as giving the power hold a by-election for the vacant to delay the whole process indefinitely. Nukufetau seat towards the end June or 28 days “It is clear that the intention of the legislators after the judgment was delivered. when adding the phrase “as soon as practicable” The decision was delivered by Senior Magiswas to ensure that there will be little delay as trate Afele Kitiona on behalf of Chief Justice Sir practicable in the circumstances at the time. Gordon Ward on May 24 following two separate “On the Opposition’s review, they sought court actions by government and the Opposition eight declarations including one that the minister seeking to determine the powers of the minister acted unlawfully according to section 88 of the responsible for elections, who is constitution by not issuing the also the Prime Minister. notice and actually holding a by The high court has also orelection as soon as practicable.” dered the minister responsible Justice Ward said only two of for elections to issue a notice the eight actions sought in the of elections five days after the Judicial Review were proper judgment, which is May 29. remedies which involved the “It is further ordered that the minister erring in law by dedate specified in the said Notice ferring the by-election and an of Elections for the lodging of abuse of the minister’s powers nominations under section 7 (1) and authority delegated to him, (b) of the Electoral proceedings breaching the legitimate expec(Parliament Act) shall not be tations of the voters, members less that seven nor more than of parliament and citizens of nine days from the said date of Tuvalu. the delivery of this judgment in Opposition member and open court and the date specilawyer Taukelina Finikaso said fied in the Notice of Election the judgment means they can of the poll be taken in the event Tuvalu’s Minister for Elections and also proceed with the necessary nothat the election is contested Prime Minister Willie Telavi T Éor dered tices required to set in motion under section 7 (1) (f) of the to hold a by-election for the vacant the by-election process. said Act shall not be less than Nukufetau seat. Photo: PIFS He said this would also mean 21 days nor more than 28 days an opportunity for the opposifrom the said date of delivery of tion to take over the majority in this judgment in open court. parliament. Since Metia’s death, the government The Nukufetau seat became vacant in Decemand the Opposition have seven seats each . ber after the death of finance minister Lotoala “We have certainly been working with our Metia. candidate and we are quietly confident we will The judgment was delivered after Tuvalu’s be able to get through this by-election,” he said. Attorney General made an application for an advisory opinion on February 6, 2013 for the Nauru in state of emergency meanings of sections 88 (2) of the constitution As this edition went to press, Nauru’s Presiand section 7 of the electoral provisions. dent Sprent Dabwido had declared a state of On February 25, seven opposition members emergency bringing the tiny island nation’s also filed an application to take leave for a Judicial constitutional crisis to a head. Review seeking the same clarification. When Nauru’s parliament was dissolved on Instead of hearing them separately, Justice May 27, it decided on a June 22 election date. Ward decided to have them heard at the same But Dabwido said this could be brought forward time. to June 8. Justice Ward, who was unable to travel to President Dabwido said the state of emergency Tuvalu after the Fiji Government denied him (SOE) was necessary because of the economic a visa, said the court was asked to consider two security of the nation. issues—whether the act gives the Minister any He said an SOE under presidential powers was right to delay issuing the notice once it has berequired to release treasury funds for departmencome necessary and second the nature of the duty tal use and overseas medical referrals as well as to which is established by section 88 (2) particularly purchase food supplies for the hospital. the meaning and effect of the phrase “as soon as The second reason for the declaration is to practicable”. bring forward two weeks the date of the general He said the first is not difficult as the minister elections to 8 June in order to avoid an overlap must issue a notice of election when an election with budgetary processes.

By Robert Matau

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SPREP celebrates 20 years of s The Secretariat of the Pacific Regional Environment Programme is the intergovernmental agency charged with protection and sustainable management of the Pacific island region’s environment.

BUILDING PARTNERSHIPS

Our vision is for a Pacific environment sustaining our livelihoods and natural heritage in harmony with our cultures. We thank you, our donors, supporters, partners and member countries for 20 years of partnership as we have navigated together on this voyage toward a sustainable and healthy Pacific.

1992 Partnerships are the cornerstone of SPREP’s work in the region.

1992 The team at the Secretariat just over 20 years ago.

EMPOWERING PROGRESS Established in 1982 as part of the then South Pacific Commission (SPC) in Noumea, SPREP became autonomous in 1993 through the Agreement Establishing SPREP. SPREP is based in Vailima, Samoa.

The team at SPREP today, all working together to achieve a Pacific environment, sustaining our livelihoods and natural heritage in harmony with our cultures.

1999

2013

ADAPTING TO CLIMATE CHANGE SPREP assists countries in dealing with impacts of climate change. SPREP assisted the people of Lateu in Vanuatu to relocate to Lirak in 2005 as rising sea levels had caused flooding of their coastal homes.

In Tuvalu, a 700,000 litre water tank has been provided for the Lofeagai community through the Pacific Adaptation to Climate Change Project. In 2011 the Cook Islands, Tokelau and Tuvalu experienced extreme water shortages causing national states of emergency.

2005

2011

MOBILISING TO ASSIST

2008 In 2008 SPREP taught biodiversity mapping techniques in Kiribati – the island nation became the 166th contracting party to the Ramsar Convention on Wetlands this year.

NATURE CONSERVATION

2006

Saving our Pacific turtles has involved many different training activities over the years for SPREP member countries, teaching communities how to tag and then track turtles. SPREP maintains a database of turtle sightings and tracking maps to this day.

of service to the Pacific islands! BRINGING PEOPLE TOGETHER

2011

2002 The Pacific Islands Conference on Nature Conservation and Protected Areas continues to grow. Since 1975 the Conference brings together Pacific nature conservation stakeholders every 4 – 5 years. The Cook Islands was the host of the 7th Conference in 2002, and later Papua New Guinea hosted the 8th Conference in Alotau, Milne Bay. This year, Fiji is the host country of the 9th Conference.

Niue hosted the Pacific Climate Change Roundtable in 2011, this event is held every two years and is the biggest gathering of climate change practitioners and stakeholders in the Pacific. Fiji will host the 2013 event.

2011

SHARING THE ENVIRONMENT MESSAGE

2003

2009

In 2003 Samoa, an inflatable whale was showcased to raise awareness!

Apisai Ielemia, the Prime Minister of Tuvalu in 2009 flanked by international media at the climate change conference in Copenhagen in 2009.

2012 Story books to help children learn.

CLEAN PACIFIC Nauru Waste Audit training , one of the many activities done by SPREP. In 2012, the regional Clean Pacific campaign led by SPREP helped raise awareness of good waste practices.

2005 Marine pollution, a feature of SPREP’s waste management work which has helped support training for our Pacific members to build their ability to manage and address marine spills.

2013

The Pacific environment - sustaining our livelihoods and natural heritage in harmony with our cultures. SPREP • Secretariat of the Pacific Regional Environment Programme • P.O. Box 240, Apia, Samoa • T: +685 21929 • F: +685 20231 • www.sprep.org

Environment

SPREP meeting in 2012...the regional organisation has grown over the years but its core principle remains the helping Pacific countries and peoples better manage and protect their environments. Photos: SPREP

SPREP with David Sheppard

‘We have grown, so as the challenges’

Pacific history was made 20 years ago on 16 June 1993. On that day, Pacific Islands Countries signed an agreement to establish SPREP—the Secretariat of the Pacific Regional Environment Programme—as an independent, intergovernmental organisation to ensure better management and protection of the Pacific environment. This month, SPREP pays tribute to the vision of our Pacific members as we celebrate our 20th birthday. SPREP provides assistance to Pacific countries and territories to protect and improve their environment and to respond to key challenges such as climate change and the management of waste. The Pacific environment is fundamental to sustainable development and the livelihoods of Pacific peoples. I am pleased that SPREP has more than doubled its direct financial and technical support to our Pacific members over the last four years. We

will continue to accelerate these efforts in support of Pacific countries and territories. SPREP has humble beginnings from an office in SPC Noumea in 1972, then moving to the old Copra Office in Vaitele, Samoa, in February 1992, and then to our current SPREP Campus offices in Vailima, Samoa, from 2000. From a one-person secretariat in 1972, we have grown to around 75 staff today. SPREP has grown over the years but our core principle remains the same—helping Pacific countries and peoples better manage and protect their environments. New turning point SPREP’s origins date back to a Pacific regional conservation conference in 1969, which recommended the recruitment of a regional ecological adviser, and SPREP started as a programme within the Secretariat of the Pacific Community

(SPC). Since then with each decade, SPREP has rounded a new turning point. In July 1972, we began as a small programme that focused on the conservation of nature in the Pacific, and were based in the old headquarters of SPC in Noumea, New Caledonia. The 1970s were a crucial time for SPREP as it was during this time that plans evolved from discussions with Maurice Strong, the Director of UNEP in 1974, to hold a “miniStockholm” Pacific regional conference on human environment and to prepare a regional environment programme. Stockholm was the first of the sosame which is called Earth Summits held every 10 years since 1972, the latest summit was held in Rio de Janeiro last year. In the 1980s, we continued to grow as a programme. A coordinating group of organisations was formed comprising representatives of the South Pacific Bureau for Economic Cooperation (now the Pacific Islands Forum Secretariat); United Nations Environment Programme (UNEP); United Nations Economic and Social Commission for Asia and the Pacific (ESCAP); and SPC. The Forum Secretary-General was chair and Arthur Dahl was the one-person secretariat in 1982. Things started to move with SPREP in the late 1980s with the appointment of Joe Reti and then Vili Fuavao, as SPREP coordinators. At the time, there was considerable discussion regarding moving SPREP from a programme of SPC to an independent regional organisation. Like any birth, there are always nervous moments but we were fortunate to have the guidance of wise men and women from many Pacific islands to steer us through this process, including Robin Yarrow from Fiji; Sione Tongilava from Tonga; and Kilifoti Eteuati from Samoa. After lengthy discussions over this matter, including over the location, with Tonga, Fiji and Samoa under consideration as a host country, the decision was taken at the highest political level to establish SPREP as a separate regional organisation, based in Apia, with Fuavao as our

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first director. In 1992, SPREP moved to Samoa and was established as an independent inter-governmental organisation with the signing of the SPREP Agreement in Apia on 16 June 1993. SPREP was born from the visions of great people and today we can see how far our width reaches. Our direct technical and financial support to member countries has grown over the last four years and we intend to accelerate this. SPREP has also increased in members, welcoming the United Kingdom into our fold last year. Our five divisions—Biodiversity and Ecosystem Management; Climate Change; Corporate Services; Environmental Monitoring and Governance; and Waste Management and Pollution Control—continue to grow in terms of new projects and activities to help our members.

action around the region to strengthen good waste practices and SPREP continues to strengthen its work on both solid and hazardous waste with a number of exciting new projects set to start this year. The secretariat has become a family base for our many staff from all four corners of the Pacific and even the globe, over the years. Our doors have seen many colleagues come and go, some have returned; however, all forever remain part of the SPREP family. Our doors are always open to our SPREP members and we welcome seeing them at SPREP; our secretariat is a key part of our Pacific community. We celebrate the achievements of SPREP and the milestones reached over the last several decades and we ask that you join us in this celebration to commemorate the visionary leadership of the many people who have helped SPREP become what it is today. Let’s continue to work together to achieve our vision of “The Pacific environment, sustaining our livelihoods and natural heritage in harmony with our cultures”. It has been a strong and exciting journey thus far and we look forward to working with you as we navigate our progress over future years.

as well as to mitigate climate change, including through the landmark Pacific Adaptation to Climate Change (PACC) project and the Pacific Islands Greenhouse Gas Abatement through Renewable Energy Project (PIGGAREP).

Challenges We have grown, and so have the environmental challenges. Our precious biodiversity, so vital for Open Day 2010 action...at SPREPÕ s headquarters in Apia. life in this region, is highly at risk and the extinction rates for some species are amongst the highest in the world. SPREP is pleased to partner with UNDP on Pacific leaders have consistently told the these two projects. It is also pleasing to note that international community that climate change is both projects are expanding with support from the most important challenge facing our Pacific Australia, the United States and the Government region. of Denmark. SPREP has been at the forefront of efforts to In 2012, the Clean Pacific campaign galvanised help Pacific countries adapt to climate change

• David Sheppard is SPREP’s Director-General and is based in Apia, Samoa.

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Defence Lord Tu’ivakano and New Zealand’s Coleman signed a Tonga-New Zealand Visiting Forces Agreement (VFA), allowing New Zealand troops to deploy in the kingdom for exercises and training. Pacific strategy In spite of a strategic vision targeted across Asia —from India to China and South East Asia—the Pacific islands remain a central focus of Australian defence policy. According to the Defence White Paper 2013, a principal task for the Australian Defence Force (ADF) is to “contribute to stability and security in the South Pacific and Timor-Leste”, the second priority after “maintaining the capacity to deter Australia’s Defence Minister Stephen Smith...launches Defence White Paper 2013. Photo: Australian Department of Defence and defeat armed attacks on Australia”. While acknowledging Australia’s ongoing role as the leading military, aid and trade power in the region, the 2013 strategic analysis recognises there are new players in the Pacific. The White Paper states that “the growing reach and influence of Asian nations opens up a wider range of external players for our neighbours to partner with”. Compared to the “Force 2030” White Paper issued by the Rudd government in 2009, this latest overview presents a more measured analysis of China’s rising power. However an underlying concern over Chinese influence is reflected in statements that “Australia growing trend for co-ordination between security By Nic Maclellan seeks to ensure that our neighbourhood does not forces in the region. become a source of threat to Australia and that no Defence Minister Smith has held regular meetIn May, Australian Defence Minister Stemajor power with hostile intentions establishes ings with his New Zealand counterpart Jonathan phen Smith made his first official visit to the bases in our immediate neighbourhood from Coleman, but for the first time, the Nuku’alofa Kingdom of Tonga, joining counterparts from which it could project force against us.” ministerial meeting included PNG Defence MinNew Zealand, Papua New Guinea and Tonga At the defence ministers’ meeting, Smith ister Fabian Pok and Tonga’s Prime Minister and —but not Fiji—for the inaugural South Pacific stressed that the ANZAC allies remain lead guarMinister of Defence, Lord Tu’ivakano. Defence Ministers Meeting. antors for military security in the South Pacific: Alongside the Pacific ministers, the governThe regional gathering came within days of “Australia and New Zealand are looked to by the ments of France and Chile were represented by Canberra launching the new Defence White Paregion to take the lead responsibility and the lead Chilean under-secretary of defence Oscar Izurper 2013. At a time when China and other Asian role in this area, and that’s a responsibility we’ve ieta and the French ambassador to Tonga Gilles powers are increasing their regional profile, this always taken.” Montagnier, with the United States and United policy document sets out the Australian governAccording to Smith, the Australian Army reKingdom sending observers. ment’s strategic vision for the vast area dubbed mains the crucial force for Pacific deployments. After the meeting, Smith stated: “We agreed the “Indo-Pacific region”. to the establishment of a new framework for Under “Plan Beersheba”, the army will be reFor the Pacific islands, the defence ministers’ regional multilateral exercises that will enhance structured into three multi-role combat brigades meeting and White Paper flagged new commitand maintain operational familiarity between our to be based in Townsville, Brisbane and Darwin. ments. The big announcement was the extension forces. Exercises will be conducted under the Townsville already hosts the ANZAC Ready of the Pacific Patrol Boat Programme, which has banner of Exercise Povai Endeavour.” Response Force, which combines Australian provided vessels and naval advisors to islands He also confirmed Australia will fund a oneand New Zealand forces for humanitarian and governments since the 1980s. year EEZ surveillance trial in the Pacific, using “stabilisation” interventions in the islands region. Under a new Pacific Maritime Security Prochartered aircraft with observers from the islands’ In the coming years, the centerpiece for Ausgramme (PMSP), many aging patrols boats will military, police, customs and fisheries services. tralian military deployments to the Pacific will be replaced after 2018, with Western powers This would complement existing surveillance be two new Canberra-class Landing Helicopter increasing maritime surveillance programmes in flights by Australian, New Zealand and French Dock (LHD) vessels, due to come into service in the Pacific’s Exclusive Economic Zones (EEZs). military aircraft under the 1992 FRANZ Treaty. 2015-17. The new LHD ships will provide the Australia, France, New Zealand and the There were also pledges for the host country. capacity for amphibious (sea to land) assaults, and United States have established the Quadrilateral Australia announced it would provide the Tonga will be deployed for humanitarian and disaster Defence Coordination Group to plan surveillance Defence Service (TDS) with a new Landing operations as well as military interventions like for the member countries of the Forum Fisheries Craft, ongoing officer training at the Australian RAMSI. Agency (FFA). Defence College and funding to rebuild the TDS The LHD ships, carrying new generation At a time when regional military deployments Naval Base at Masefield and TDS facilities on helicopters, will replace ageing warships like to Timor-Leste and Solomon Islands are winding Ha’apai and Vava’u. HMAS Manoora, Tobruk and Kanimbla. These down, the defence ministers meeting highlights a

Canberra plan tightens defence ties

But what does it mean to islands countries?

32 Islands Business, June 2013

Defence S

PNG/Fiji pooling resources

ilitary heads from Suva and Port Moresby have agreed in principle to pool together their forces under a new defence co-operation agreement incorporating the Republic of Fiji Military Forces and the Papua New Guinea Defence Force. Since the 1980s, Fijian peacekeepers have led popular contingents at several UN missions where international commands have been commissioned in areas such as Lebanon, Kosovo, Sinai, Timor Leste and Iraq. In recent years though, with the prolonged military rule in Fiji in the wake of the 2006 coup,

the UN has been under criticism to reduce reliance on men who were previously summoned as part of the Fiji Military Forces, when Fiji was a member of the British Commonwealth. Prime Ministers Frank Bainimarama and Peter O’Neill initiated talks on ways the two mili- V o r e q e tary commands could join forces Bainimarama. in both regional and international Photos: MINFO assignments when the two met in April. PNG Defence Force chief of staff Navy Cap-

Peter O’Neill.

tain Alois Tom said alot more dialogue will be exchanged between the region’s two largest military units before joint operations will hit the ground. He said under the proposed new accord, Fijian personnel will assist m4en from PNG with military training needs as well as join forces in strifetorn zones where peacekeeping callouts are made abroad.

—By Davendra Sharma

Guinea and in 2012 announced a new programme In May, the Australian warship HMAS Sydney mothballed vessels have been used over the last to improve the PNGDF aviation wing, with a joined the US George Washington naval carrier decade for interventions in Timor Leste, Solomon $7 million annual budget for three helicopters, group based in Japan. Islands and Tonga, transporting asylum seekers to operating costs, maintenance and training. In 2011, the US Commander of the 7th Fleet detention centres on Nauru or sabre-rattling off In this year’s PNG budget, the O’Neill governvisited Noumea to meet his French counterpart, the coast of Fiji during Operation Quickstep, in ment increased defence spending to 188 million while US marines from Okinawa joined the the lead-up to the December 2006 coup. Kina (A$94 million). The PNG government Southern Cross exercises in New Caledonia for According to Prime Minister Julia Gillard: is planning to expand PNGDF numbers and the first time in 2012. “The new LHD ships represent a fundamental develop its own National Security Policy and This US-France military co-ordination comes shift in how the Army will deploy land forces and Defence White Paper. at the same time the US and French territories conduct operations in response to the full spechave joined the Pacific Islands trum of scenarios in the future.” Forum as observers or associate The White Paper maintains members, opening the way for past pledges for the purchase of influence on Forum security naval vessels, 12 new submarines policies. and aircraft that can enable AusTo the dismay of the FLNKS tralia to maintain operations in a in New Caledonia, Australian changing Indo-Pacific region. defence planners see French But these plans come at a cost military deployments in the and successive governments Pacific as a long-term strategic have not guaranteed the fundasset. ing to cope with ballooning cost The 2006 Australia-France overruns of high-tech weaponry, Defence Cooperation Agreesuch as the planned purchase of ment (DCA) strengthened ties 100 Joint Strike Fighter (JSF) between the ADF and French aircraft from the United States. forces, while the 2012 Australian With Canberra’s defence buDefence Posture Review notes reaucracy notorious for inefthat “Australia can use facilities ficiency, wasteful procurement and infrastructure in New Zeaprocesses and budget blowouts, land and French New Caledonia Australia and allied powers are to support our operations in the challenged to match strategic asSouth Pacific.” pirations with budgetary realties. In spite of this, defence coopThis fiscal gap is driving new US 7th Fleet Commander...visits the French military forces in Noumea. Photo: Department of Defence eration can clash with broader burden sharing between the political and diplomatic agendas. ANZUS allies, France and PaThe White Paper has no discuscific military forces. Alongside Fiji, Papua New Guinea is now a sion of self-determination struggles in BougainUN Troop Contributing Country. With Ausville or New Caledonia that might challenge the PNG, NZ play new roles tralia providing pre-deployment preparation regional status quo. Papua New Guinea will host the next South and training, PNGDF personnel have deployed There’s little evidence that defence planners Pacific defence ministers’ meeting in 2014, a to UN peacekeeping missions in South Sudan have heard the Pacific voices who question the reflection of broader defence co-ordination beand Darfur. role of military forces in Fiji coups or conflict in tween Canberra, Wellington and Port Moresby. New Caledonia, West Papua and Bougainville. In the 1990s, defence relations between CanUS seeks Pacific allies As funding increases for new strategic weapberra and Port Moresby were strained by debates In the northern Pacific, the US government onry, people at the grassroots also ask whether over human rights abuses, the use of Australianis extending military deployments in the face of resources should be diverted from defence budsupplied helicopters and patrol boats during the perceived Chinese strategic influence. gets to address other threats to national security, conflict in Bougainville and the Sandline affair. Guam is being transformed by planned relike climate change. At government level, those debates are long gone location of US marines from Okinawa and the Forum members are looking north, to underand Papua New Guinea is being presented as a basing of US nuclear attack submarines in Apra stand the strategic shifts caused by economic and key strategic partner. Harbor. Under the Obama administration’s political changes in China, India and Indonesia. Australia’s Defence Cooperation Programme “Pacific Pivot”, US Marines are being rotated With new governments in Beijing, Paris and (DCP) for Papua New Guinea is the largest through bases in northern Australia, while B-52 Tokyo during 2012 and changes likely during allocation for any country, with funds for the and B-2 bombers will use Australian airfields for Australia’s elections on 14 September, regional PNGDF doubled in last year’s budget. Australia bombing exercises. defence policy will continue to evolve. has 25 ADF personnel working in Papua New Islands Business, June 2013 33

Defence Viewpoint

Australian defence encounters new Pacific realities engagement is the continuing diplomatic standoff with Fiji. A key plank in the sanctions regime is a ban on defence cooperation. Historically, Fiji has been Australia’s largest defence cooperation partner in the Pacific and the key to broader regional defence cooperation. This is not simply because of the size and capability of the Fiji Military Forces, but also because of Fiji’s place as a hub for the region. When an Australian defence attaché arrives in Suva after the elections in 2014, he will find a radically different diplomatic environment than when his predecessor left. The Fijian government has a new-found confidence in its diplomatic affairs and Australia is no longer the dominant military cooperation partner. Countries such as China, Indonesia and Russia have filled the gap in defence training and logistics. This situation is largely of Australia’s doing and it will be its responsibility to play ‘catch up’. It’s clear from the tone of the White Paper that

At one point, the White Paper highlights the role of the Royal Australian Navy amphibious ships in humanitarian assistance, etc, in the Paanberra has turned its attention back to cific. In contrast, the maritime security boats will the Pacific. No more potent a symbol be gifted to Pacific Islands states to assist islands of this renewed interest could be found nations in protecting their Exclusive Economic than the Australian Defence Minister Stephen Zones (EEZs). Smith’s visit to Tonga on the eve of releasing the The capability of these boats will be defined Defence White Paper ‘Defending Australia and in the year ahead and there is an opportunity to its National Interests’. shape the project to meet the maritime security The fact that Smith was convening the inauneeds of Pacific Islands states for the next gengural annual ‘South Pacific’ defence ministers eration. Furthermore, whether the boats gifted meeting is certainly significant. But there is also to individual islands nations are connected into substance behind this symbolism. The minister an integrated regional surveillance network supforeshadowed the new Pacific Maritime Security ported by Australian assets (such as maritime Programme, which replaces the Pacific Patrol patrol aircraft) remains to be seen. Boat Project and forms the centrepiece of AusTo realise its potential, the gulf that has opened tralia’s new Pacific strategy. up between supporters of Fiji and supporters of Canberra has some catching up to do after Australia isolating Fiji will need to be bridged. years of benign neglect. For over a decade, Pacific and Australian leaders will have to navigate Australia and its US ally have been focused on their way through the turbulent waters created by Iraq, Afghanistan and the ‘War on Terror’. Operathe ongoing diplomatic tions in Afghanistan tension. are winding down A significant gap in and the White Paper all the White Papers is is sensitive to the imthat they don’t include plications of this major implementation strateshift in tempo. gies and the most chalAustralia’s other lenging issue will be l a r g e a n d e n d u rhow the defence cooping operation in the eration with the region Solomon Islands is can be rebuilt. also winding down. The maritime secuRAMSI has been a rity boat programme major bridge to the is one possible bridge. region and ending this Another could be in relink will have an imlation to peacekeeping. pact on the Solomons Only last month, a new and on Australian de- Military cooperation...HMAS Sydney joined US naval taskforce in May. Photo: Australia’s Department of Defence arrangement linking the fence engagement. training of Fijian and The second princiPapua New Guinean pal task of the Austrapeacekeeping forces was announced. PeacekeepAustralian defence planners are sensitive to the lian Defence Force (ADF) identified by the White ing is a costly and admirable endeavour and one in changed dynamics of the region. The aim is not to Paper is to “contribute to stability and security in which the FMF and ADF have some experience. “control” but to “contribute” to the maintenance the South Pacific and Timor-Leste”. It would be natural for Fijian participation in of regional security. Naturally this comes second to providing for operations to expand after 2014 and much work Furthermore, the emphasis is on regional the direct defence of Australia. However, it is could be done to prepare for this eventuality. security challenges that more reflect the interests widely acknowledged that a direct threat is highly Similarly, military forces have the best training of the Pacific countries rather than the orthodoxunlikely to develop for a generation and therefore and expansion capacity to respond to complex ies underpinning the rest of Australia’s strategy. the focus on the Pacific gains priority. humanitarian contingencies and coordinating the Seeing the Pacific through Pacific eyes means While the US is pivoting to Northeast Asia to development of a regional capacity to act swiftly that the focus is on maritime security (such as focus on China, Japan and the Koreas, Australia is to natural disasters is long overdue. fisheries management and protection), transnapivoting back into the Pacific. The challenge for There is great potential for the White Paper to tional crime (such as human trafficking, people both is that the seascape has changed dramatically support enhanced regional defence cooperation, smuggling and drug smuggling) and disaster in both areas since their attention shifted to the but it has to be acknowledged that the strategic management (humanitarian assistance, disaster Middle East over a decade ago. seascape has changed. Whether it achieves its relief and stabilisation). One key strategic shift that links this ‘pivotpromise depends on the regional buy-in. ProbThe new maritime security boat programme ing’ is that the Pacific is becoming an arena for ably more than at any time since the Pacific Isneatly captures Australia’s intentions and the geopolitical contest between the great powers. lands states gained independence, regional leaders potential role Pacific leaders have in shaping it Australian and US’ strategic interests may very have the capacity to shape the scope of defence to suit regional interests. well overlap in this regard, but Australia is apt to cooperation. This programme will be the centrepiece of view the Pacific as its backyard rather than simply defence cooperation. We have no idea what the a venue for strategic competition. • Dr Michael O’Keefe is a Senior Lecturer & Convener at boats will look like but the intention is clear. A major stumbling block preventing reLa Trobe University, Victoria, Australia

By Michael O’Keefe*

34 Islands Business, June 2013

Fisheries

A Taiwan-Marshall Islands joint venture vessel...offloads tuna in Majuro. Photo: Giff Johnson

US to pay over US$94m in a transitional fish deal

Islands, Federated States of Micronesia, Nauru, Palau and Papua New Guinea—control Pacific waters where 70% of the region’s skipjack is caught . The biggest breakthrough took place a year ago when the United States government and its fishing industry agreed to triple the fishing access fees from the annual US$21 million to US$63 million. PIPs want the US to abide by national laws like other distant water fishing nations like Taiwan and Japan. the United States are dictating terms Under the current treaty, the US to the owners of the fishery, tagging fishes in any EEZ of the PIPs and aid funding to the whole negotiation. does not abide by their national laws. Three years ago, the total value The US, for instance, wants a of the fishery under the Vessel Day 90-day grace period locked into the Scheme (the mechanism through deal, should they have to abide by which tuna fishing is managed and new national laws. controlled) was US$1.5 billion dolFor instance should Papua New lars—and as a result of the measureGuinea ban the use of Fishing Agment mechanisms established by gregate Devices (FADs) for a certain the Parties to Nauru Agreement, period of time, the US wants a the value of fisheries for PNA coun90-day notification period, which tries, which supply 25 percent of the gives them an extra three months to Dr Transform Aqorau... world’s tuna, has increased to worth Pacific needs to move away continue fishing as normal before US$3 billion. from access negotiations. abiding by the laws. The transitional agreement signed Photo: Islands Business Negotiations have been locked by Pacific Islands Forum Fisheries on these issues plus other issues Agency nations and the United States representawhich deal with conservation and managing a tives comes into operation on June 15 when the sustainable stock. current financial arrangements cease. PNA director Aqorau said the Pacific needs to Under the transitional agreement, the United move away from access negotiations. States’ fishing vessels have been given 12,000 days He said nations that want to fish should just fill to fish in exclusive economic zones in the Pacific an application form to fish as long as they meet where the PNA Vessel Day Scheme is adopted. the requirements. The remaining 450 days will come from EEZs “If our vessels were to fish in their waters, will of other Pacific Islands parties or their territories we have the flexibility to choose what terms of acwhere the Vessel Day Scheme is not applied. cess we want to apply? That is what fishing states Under the current US treaty, non-PNA memdo when they fish in our region,” Dr Aqorau said. bers receive a share of the development funds Negotiators hope to conclude negotiations despite not contributing any fish to the US. by December 31, with the goal of the new 10Parties to Nauru Agreement nations—the year treaty funding package to start on January Marshall Islands, Kiribati, Tuvalu, Solomon 1, 2015.

Negotiators hope to finalise deal end 2013 By Robert Matau Pacific Islands Parties (PIPs) have secured a transitional deal which will see 40 United States fishing vessels fishing in the Pacific for 12,450 days for US$94.5 million in the next 18 months. The transistional arrangement was struck last month at a session in Honiara after negotiatiors were unable to complete the new agreement. Instead, they settled for an 18-month transitional arrangement that will implement the new, tripled access fees and the agreed-to measures through to December 2014. This will extend current negotiations, which are locked into the finer issues of national laws which PIPs are trying to ease into a successor agreement. However, the Parties to the Nauru Agreement Secretariat director Dr Transform Aqorau said the deal was not an ideal outcome because parties are now left with fewer days, which they can use to maximise their revenue. “The real worry will be: Can the parties still operate inside the limits when the fishery is increasingly over-subscribed,” Aqorau said. “We really have to look hard to work to the limits and not sell to all parties, irrespective of the limits set. The cake is now considerably smaller.” Aqorau has been an advocate of rights-based fisheries where nations dictate their own terms in which people fish in their waters. Right now the distant water fishing nations like

Islands Business, June 2013 35

Fisheries

PNA co-brand…PACIFICAL.

Maurice Brownjohn...presenting at the 4th European Tuna Conference in Brussels in April. Photo:Giff Johnson

PNA moves to market first sustainable tuna in Europe Business initiative to command premium price By Giff Johnson A three-year effort by the Parties to the Nauru Agreement (PNA) is expected to see the region’s first “certified sustainably caught” skipjack tuna products hitting the Europe markets this month. The latest PNA milestone links a conservation measure—promoting tuna caught without the use of fish aggregation devices (FADs)—to a business initiative that is expected to command a premium price in European and United States markets. Marine Stewardship Council-labeled skipjack tuna coming from waters of the eight-member PNA countries is ready to supply the global markets for sustainably harvested canned tuna, said PNA Commercial Manager Maurice Brownjohn. “Within weeks the first skipjack will be landed to end up in cans with the MSC logo and the PNA co-brand Pacifical,” said Brownjohn in early May. These will go on sale in Europe. Over the past three years, PNA has jumped numerous challenges, including strong objections from United States-based environmental groups with tuna industry ties to gain MSC “chain of custody” certification for the catch, processing and supply of free school (no FADs) skipjack tuna. Tuna caught without the use of FADs is considered to be a sustainable. At the late April European Tuna conference 36 Islands Business, June 2013

in Brussels, Brownjohn promoted the MSC certified tuna, saying this is a world first for the skipjack tuna industry. This brings a new dimension in consumer information about tuna to the global fish trade, said Brownjohn, who is based in Majuro at the PNA office. Under the MSC Chain of Custody scheme, consumers can see where and how their tuna was caught—from the boat to their plate. The certification itself is done by an independent third party to ensure consumers can be confident their tuna came from the source and method of fishing stated on the can, he said. A key part of PNA’s management program is the 100 percent coverage of purse seiners by trained fisheries observers who monitor and record the catches. “PNA leaders have recently called on all companies fishing in PNA waters to start to fish tuna that can be certified as sustainable by the MSC to support this project,” Brownjohn said. “Papua New Guinea has further publically announced they expect all in the industry to now deliver MSC free school skipjack to our associated processors as a term of licence renewal. “We hope that more companies will participate in the MSC Chain of Custody certification.” The higher premiums that wholesalers in Europe will pay for sustainably caught tuna is the incentive that PNA is counting on to lure the fishing industry to support the effort.

The Marine Stewardship Council’s website lists “PNA Western and Central Pacific skipjack tuna” as one of 146 fisheries worldwide that have won certification for following sustainable fishing standards. “To confirm that they operate sustainably, certified fisheries are audited every year and fully reassessed every five years,” the website states. But there may be some bumps along the road as PNA attempts to launch its new Pacifical brand with the MSC certification. This fledgling new tuna industry is being harassed for developing this sustainable fishery, according to Brownjohn. Brownjohn said this is largely due to Earth Island Institute (EII), the U.S.-based nongovernment organisation that promotes a wellknown “Dolphin Safe” eco-label for canned tuna products, threatening to “blacklist” fishing companies, processors, and retailers if they do business with PNA’s new certified Pacifical brand of skipjack. “We understand Earth Island Institute is issuing alerts to consumers and directing our processors and buyers that Pacifical is not part of its ‘dolphin safe’ program and therefore cannot be traded or be considered ‘dolphin safe,’” said Sylvester Pokajam, Managing Director, National Fisheries Authority of Papua New Guinea. Brownjohn said PNA refuses to work with Earth Island Institute dolphin safe program because there is no dolphin mortality related to certified skipjack caught without using FADs in the Pacific. Earth Island Institute “lacks credibility” and is engaged in “restrictive trading practices,” he said. “Skipjack tuna and dolphins do not swim together as verified by scientists at various tuna commissions,” Brownjohn said, adding PNA’s MSC certified skipjack is fully verified from the net to the retail and fully supported by NGOs like WWF, Greenpeace and PEW Foundation. “In order for PNA to deliver its MSC certified skipjack tuna to the North American market, major US brands will first need to realize that they must tear down the trade barrier that has been created by Earth Island Institute with which they have been members and supporters for the last two decades,” said Brownjohn. “The MSC logo not only protects dolphins, but looks after the sustainability of all species in the ocean. “It’s now time for all the US tuna brands to show how serious they really are about ocean conservation and fulfill the commitments that they have made with the International Seafood Sustainability Foundation to work towards MSC certification for all their tuna products. “As part of that commitment, a difficult but necessary step for them will be to disengage themselves from an unreliable scheme that is not science-based. “Only this way can they open the doors to deliver sustainable tuna in their cans.”

Trade “You will find that first of all we are in a process of negotiation with the Europeans and you will find that on the side of the Pacific islands countries, we can with absolute justification make exactly the same assertion and we can point to facts to support such an assertion from our side,” Tuiloma said at a press conference held at the end of the Pacific ACP Trade Ministers in Nadi. “We made almost extraordinary efforts on market access offer for example. These things are not simply drawn out of the drawer. “These things require a great deal of hard work, national consultations and other necessary data collection and contacting communities. “We were able to put this together for all Pacific Islands countries in good time given the circumstances. “All these offers have been conveyed to the other side (EU) and today, we are still awaiting responses.” Fiji’s Attorney-General Aiyaz Sayed-Khaiyum (left)…hosted the PACP trade ministers meeting in Fiji last month. Photos: Fiji’s Ministry Tuiloma was, however, not asked of Information to respond to the senior EU diplomat’s position that Pacific ACP countries would need to establish national competence authorities for each islands states that would oversee health and sanitation issues of fish exports. In demanding this, the EU is indicating that it rejects the position of the PACP that Europe considers a regional competence authority. Ambassador Jacobs also warned the islands that the global sourcing concession offered under its interim EPA with PNG, does not mean the same concession would remain in a comprehensive EPA. “Global sourcing led to a significant controversy during the ratification of the interim EPA in the European Parliament. for smaller islands still remain By Samisoni Pareti “It is by no means certain that questionable.” the European parliament will acThis assertion has been supWhen Pacific trade negotiators sit down cept or extend the clause in the ported by a recent study, said later this month with their European Commispermanent EPA. Ambassador Jacobs, that showed sion counterparts to carve out the finer details of “One concern raised is the posglobal sourcing is only one of the their Economic Partnership Agreement (EPA), sible impact of global sourcing on many factors that determine the the pressure points would be fishery, market resource management. Pacific Islands’ ability to export access and services. “This is one of the reasons why fish products to Europe. That is the word from the EU Ambassador for we have to be certain that effective The economic environment, the Pacific, based in Suva, Andrew Jacobs. conservation and management infrastructure constraints, health Invited to address the trade ministers and measures for fishery are in place and sanitation compliance and ilofficials of the Pacific ACP group in Nadi last in the region before we conclude legal, unregulated and unreported month, Ambassador Jacobs accused the Pacific a new EPA. fishing legislation are equally region of being too “inflexible” in negotiations “The items outstanding in important factors. over fishing access. the fishery chapter are not only PACP’s response to claims “The EU also doubts the fish conservation numerous but have political poimade by the Ambassador was measures advocated by the Western and Central gnancy that goes beyond EPA frank and swift, giving a glimpse Pacific Fisheries Commission in the form of negotiations. of how the negotiations will look Shaheen Ali…PACP could also cite Vessel Day Scheme. “For this reason, the conclustudies that showed global sourcing like in Brussels later this month. was the way to go for the islands. sion of the negotiation in the next “Because of this, the EU will be unable to Fiji’s Permanent Secretary for provide fresh proposals on fresh and frozen fish. round of negotiations in early July Trade and Industry Shaheen Ali “Realistically, the political opposition to global is simply not realistic. told Islands Business that the Pacific ACP could sourcing which the EU faces domestically obliges “More time is needed at the technical level to also cite studies that showed global sourcing was the EU to consider a clause where the product narrow considerable gaps and positions. the way to go for Pacific islands countries. coverage will be much narrower than the current “Any bracketed texts would further require Tuiloma Neroni Slade, Secretary-General of clause in the current EPA. more political will for the heavy lifting required Pacific Islands Forum Secretariat, also rejected “In addition, the potential development imto bridge the gaps.” the EU’s claims of inflexibility. pacts of global sourcing for fresh and frozen fish Market access is also going to be a fiery point

EU reveals its EPA ‘cards’

Brussels negotiations to boil down to fishery, market access, trade in services

Islands Business, June 2013 37

Trade in the EPA negotiations in Brussels. Ambassador Jacobs seemed to think so too. He did clarify that in amending the market access regulation in April 2011, the European Parliament did not in the process set a deadline on when the comprehensive EPA negotiations should be completed. This EU position contradicts the Pacific ACP Leaders’ decision to set December 2013 as the deadline for EPA negotiations. Fiji, in particular, wants negotiations to be wrapped up by October 2013. “On 16 April 2011, the European Parliament adopted an amendment to the market access regulation whereby countries that have not ratified their EPA by 1 October 2014 would be excluded from the market access regulation,” said Ambassador Jacobs. “They would lose duty free, quota free access. Only Fiji will be affected by this amendment. “The market access regulation only concerns Interim EPAs. It does not establish a deadline for negotiations of permanent EPA. No deadline in fact exists.” The host of the PACP trade ministers’ talks in Nadi, Fiji’s Attorney-General Aiyaz SayedKhaiyum, who is also the trade minister, does not buy the view that in insisting that there’s no deadline on EPA negotiations, the EU is trying to apply extra pressure on Fiji to ratify the interim EPA it signed with Brussels in December 2007. PNG, which signed an IEPA with the EU like Fiji, has since done ratification and is now exporting tuna products duty and quota free to the European market. Fiji has made it known that it would not ratify its IEPA since it is not happy with some of the concessions offered by Europe. Additional pressure Meeting documents sighted by this magazine did indicate that Pacific ACP trade officials recognised that the amended market access regulation of the EU have added additional pressure on the negotiations. There are even some delegates who carry the belief that in insisting for a deadline-free trade negotiation, the EU appears to be hoping that the seemingly united front of the Pacific ACP states would collapse. One senior islands official suggested to this magazine that Brussels appears to show no appetite for an early conclusion of negotiations for a comprehensive EPA. The aide said it is way too late for Brussels to be asking that trade in services should be included in EPA negotiations now. This will only prolong the talks and no conclusion would be in sight soon, the senior official lamented. “The EU is more than willing to discuss services in negotiations of a comprehensive EPA and to include a services chapter in the negotiations,” Ambassador Jacobs told the Pacific trade ministers and officials. “We are not ready to conclude an agreement which essentially covers trade in goods and only then negotiate trade in services in parallel with the ratification of trade in goods agreement. “This would imply that we go through the ratification process twice, an administrative burden we don’t want to take on. “Brussels is ready to include services in negotiations but it needs to get a clarification on what the expectations of the Pacific states are, in particular, labour mobility.” 38 Islands Business, June 2013

Why PACER is not good for PNG: Maru By Samisoni Pareti Is there life in PACER Plus if Papua New Guinea joins Fiji in opting out of trade talks with Australia and New Zealand? This became a hot topic of discussions when PNG’s trade minister Richard Maru announced at the inaugural Melanesian Spearhead Group’s trade ministers meeting in Nadi last month that Port Moresby is reviewing its participation in the current PACER Plus negotiations between Pacific islands countries and their two bigger and wealthier neighbours—Australia and New Zealand. “At the moment as the new minister coming in, I am not convinced that PACER Plus is of any interest, or have any mutual benefits for PNG, and it is my intention to have a look at it again and take it back to my government to take another look,” Maru told Fijian journalists who covered the one-day meeting. “Our focus now is on the MSG trade arrangement. I think the important thing for us is to fully implement the MSG trade arrangement first. “Make it work and reflect on it in a number of years time and see whether there’s value in going into a total Pacific trading bloc and really look at the value of a trading bloc with Australia and New Zealand. “Right now, if we enter into such an arrangement, it will be one sided. All the goods will be coming from Australia and New Zealand into the Pacific market only. “At the moment, we are not really doing much trading with Australia and New Zealand. “We can’t even send taro there. We have not been able to sell our greens. “It’s all one sided traffic so what’s the point of going into a trade arrangement with Australia and New Zealand? “There’s nothing to be gained for us, so rather than wasting time on it, let’s focus on what’s important for us and that’s the MSG trading bloc. “I think there’s mutuality on this one and that’s what we are going to focus our attention on—our assets and our resources. “At this juncture, we are convinced that it’s in our mutual interest for all of us to look at that. “That is the decision of PNG, we are going to look at it as a new government. To the rest of the islands, it’s up to them. You make up your own mind what you need to do. “But for us at this stage, I cannot see any rationale to be part of that discussion leading to a trading bloc with the rest of the Pacific and Australia and New Zealand. We see no merit in that.” Asked by this magazine whether Port Moresby will soon withdraw from PACER Plus negotiations , Minister Maru said all he could say is that Port Moresby is reviewing its involvement. “I’m saying we are reviewing that and in the next few weeks I will be talking to my government and we will make a stand on this one. “We can’t justify spending money on officials coming to meetings of PACER Plus. In my book, it’s a waste of time.

“As far as we are concerned in PNG, we are firmly committed to the MSG trade agreement and its future. “We believe that as it evolves to include services and the movement of people, I think it will also expand to include investments between our islands states. “I think this will become the MSG trading bloc, it will become the most influential bloc within the region. “We would like to see that and we certainly will do all we can to enhance the current efforts of making the MSG a very solid trading bloc.” All the remaining sovereign states members of the Melanesian bloc said they see a lot of merit in PNG’s position on PACER Plus. But Fiji, Vanuatu and Solomon Islands said they would need to consult their respective governments before a decision is taken on their future participation in PACER Plus negotiations. Fiji’s trade minister, who’s also the AttorneyGeneral in Frank Bainimarama’s regime, Aiyaz Sayed-Khaiyum said: “You have to be strong and to be able to function among your own peers first, then you can include those from the outside and obviously Fiji will be working with those positions. “Definitely there’s merit in what the Honourable Minister (of PNG) is saying, in terms of being strong and being able to fortify, consolidate your own position first before you can get into a much wider trade arrangement.” For their counterpart in Vanuatu, Minister Marcellino Pipite said he would need to go back to his council of ministers on PACER Plus. “So I will go back and discuss with my government about PACER Plus and if it is not responding to what we really want in the country, then we will have to maximise the use of the MSG Trade Agreements in terms of labour mobility, and so forth.” Solomon Islands’ Trade Minister who was represented at the inaugural MSG Trade Ministers meeting by its High Commissioner to Fiji, Patterson Oti, said he would need to consult his capital before a decision is made on their participation in future PACER Plus negotiations. “Since negotiations for PACER Plus was triggered by signatures to the interim EPA by Fiji and PNG in 2007, we have been going back and forth on PACER Plus. “So there’s parallel negotiations going on with the EU through EPA, so which one we conclude first? As it is, governments have been made to commit a lot of time and money to attend the two negotiations. “So what the Minister from PNG is saying is that while these talks are ongoing, let’s consolidate the MSG trade agreement first. “Now we are coming forward to propose a revised third MSG trade agreement which will become more an integration economic arrangement for MSG states. So that’s moving another front but at least we have proven ourselves since the MSG trade agreement became effective in 2011.”

Trade Viewpoint

Rejecting free trade requires new forms of regionalism that would ensure that we, the FICs, are able to take advantage of the entire agreement to increase our trade with Australia and New Zealand and the outside world.” Whilst the official still sees some potential in PACER-Plus being a transformational agreement, the recent positions taken by Australia in particular, seem to be stoking the fires of discontent in the region. On a similar note, there’s the negotiations between Pacific ACP countries and the European Union on the Economic Partnership Agreements (EPAs). Having been effectively told last October that the EU wasn’t prepared for negotiations when they met, they were then rebuffed by the EU in May about their push to conclude, their

small and seeing where that goes. Whilst the MSG agreement may offer some differences to the standard free trade agreement, it must be viewed more as a starting point than apua New Guinea’s trade Minister, an end. Richard Maru, recently set a cat amongst The unique nature of the Pacific demands that the pigeons by saying that PNG was not the region’s leaders look beyond the standard free interested in the regional trade negotiations trade narrative, a narrative that defies the reality known as PACER-Plus. of the region. Specifically, Minister Maru commented that Following the development path sold by “our feelings at the moment is that PACER Plus Australia, New Zealand, the EU and other big would be one sided in favour of Australia and players will not result in an economic future that New Zealand...We are frustrated with them. places Pacific peoples and their environment at “We can’t export our taro there, they won’t its centre. accept our greens...There’s nothing to be gained Instead, the islands should look to the lead from a trade agreement at the moment. provided by others. The ALBA alliance in South ‘We cannot justify the huge amount of reAmerica is a good example of different visions for sources we expend on such negotiations. They regional cooperation. are a complete waste of time.” Instead of pitting the counYou can just imagine the imtries against each other like mediate typing on keyboards in PACER-Plus would, ALBA Canberra. looks at ways that countries That the comments came can help each other in the spirit from a minister may be surprisof solidarity with guaranteed ing to some but the sentiment benefits for all those who is nothing new in the region. participate. Solomon Islands Prime MinisALBA also looks to strengthter Gordon Darcy Lilo has said en inter-regional investment that if there was a need for every and trade going as far as priMelanesian country to reject oritising it. free trade in favour of fair trade, This is a far cry from what is then they must all act together. currently on the table. PACERThe recent comments made Plus is framed as a developby Pacific MPs who had atment agreement purely on tended the Pacific Parliamentary the grounds that Australia and and Political Leaders Forum in New Zealand have chipped in Auckland say it all. a few bucks to help the Pacific Attendees from Vanuatu, participate in the negotiations PNG, and Samoa all criticised as well as the proposed implethe global economic model mentation assistance—that is saying that it was unfair to the money to ensure the Pacific Pacific. abides by the agreement and In the context of the promised benefits that come from PNG’s Trade Minister Richard Maru (right—in garland)...threatening to pull PNG out of the PACER keeps its markets opened to free trade, Governor Gary Juffa Plus negotiations. With him is Fiji’s Prime Minister Voreqe Bainimarama. Photo: Fiji’s Information Ministry Australian and New Zealand exports. from PNG summed it best: PNG is right to want to “The people of the Pacific live walk away from PACER-Plus, especially now position on labour mobility and their demands on their own land—they are self-sustaining althat trade in services and investment are likely around fisheries. ready. If you impose free trade, you are going to to be introduced to the negotiations at the next With the region seemingly sticking firm on take away the opportunities they have to be truly ministerial meeting. their demand that EU access to their fisheries economically independent.” The stakes are only getting higher for the isn’t the price for market access for fresh fish These come as negotiations on PACER-Plus region with the benefits continually being exports, it seems that all of a sudden the EU has stumble; the recent intersessional negotiations downgraded. lost its appetite for the region and the develophave been seen as anything but productive. The MSG trade agreement is an opportunity ment aspirations that were supposed to be part As was reported, one official commented to begin to see regional integration in a more of the EPAs. that “[t]he positions adopted by Australia and Pacific focussed way. And let’s not even get started on the complete New Zealand in the negotiations did not match It has to ensure that it avoids the framing that loss of faith the Pacific has in the Pacific Islands their public pronouncements that they viewed standard free trade agreements set for it and inForum Secretariat and its handling of all trade PACER Plus as a trade and development assisstead start from the position of how to maintain matters, largely seen as being in the interests of tance agreement. control over Pacific economic futures. Australia and New Zealand. “Australia and New Zealand assured that they Where does this leave the region? Minister would be providing assistance to FICs to imple• Adam Wolfenden is the Campaigner and Maureen Penjueli Maru believes that for PNG, focusing on the ment their PACER Plus obligations, but they Coordinator of the Pacific Network on Globalisation (PANG), a Pacific based NGO that focusses on trade justice. MSG Trade Agreement is the best option, starting were not as forthcoming on the broader assistance

By Adam Wolfenden & Maureen Penjueli*

Islands Business, June 2013 39

Mining

Checking out what is there...deep-sea mining promises riches and risks. Canadian company Nautilus Minerals, has plans to mine polymetallic massive sulphides, just off the coast of Papua New Guinea at a depth of around 1600m. According to Nautilus, these massive sulfides contain high concentrations of copper, gold, silver and zinc. Photo: Nautilus Minerals

A reality or illusion for the islands? The minerals lying deep beneath our shores By Anouk Ride While PNG made news for being the first country in the world to issue a licence for deep-sea mining, more and more Pacific Islands countries are getting approaches from companies interested in exploration and exploitation of deepsea minerals. The questions that arise are—what are the risks? What are the benefits? What do Pacific Islanders need to know to make the right decisions here? Many islanders have learnt, the hard way, the consequences of not knowing what they were getting into with mining and unsustainable development—phosphate mining on Nauru perhaps being the most dramatic example of a mining boom…and then a bust. Is deep-sea mining different? Time is critical, says Dr Jimmie Rodgers, Director-General, Secretariat of the Pacific Community (SPC): “Is it urgent? Is it important now? Yes! Because multinationals are not going to wait to give Pacific Islands countries time to look at all the studies, environmental analysis, before they come in—they push in.” Over 300 exploration licences have been granted in Pacific Islands countries like Solomon Islands, Vanuatu and Tonga. It seems deep-sea mining promises riches and risks. In the Pacific, most of the mineral deposits considered profitable to mine are known as Seafloor Massive Sulphides (SMS). 40 Islands Business, June 2013

Some countries have manganese nodules and cobalt-rich crusts on the seafloor, mining of which are likely to have greater environmental impacts than SMS. For instance, nodules, small lumpy concretions that form over millions of years as metals from the seawater and seafloor sediments precipitate around a core, which may be a shark tooth or rock fragment. Nodules cover a significant area of the sea floor and contain minerals such as manganese, copper, nickel and cobalt. Minerals are also found around hydrothermal vents—places where very hot fluid (around 400 degrees Celsius) that carries minerals comes into contact with cold sea water (around two degrees Celsius), resulting in the precipitation and deposition of minerals on the seafloor. The “chimneys” that form around the vents are the direct result of the accumulation of minerals on the seafloor over time. In most cases, the hot fluid resembles black smoke in the water column signifying the relatively metal rich fluid and resulting in their popular description as “Black Smokers”. This type of mineral deposits are known as Seafloor Massive Sulphides and are rich in copper, gold, silver, zinc and lead. Companies are now chasing these natural phenomena in the Pacific Islands region and other parts of the world ocean. Deep-sea minerals have a use in everything from mobile phones to metal alloys, renewable energy technologies and batteries.

Papua New Guinea’s Nautilus minerals venture was halted in 2012 after disagreement over government’s equity and benefits. Meanwhile, projects now go ahead in Sudan, Saudi Arabia, New Zealand and other countries. The companies and scientists are quick to point out the consequences of sea mining versus land mining are different—land mining can produce more than 99 percent waste and less than one percent ore. Waste materials when exposed for an extended period of time produce acid by the reaction of sulphide minerals with fresh water and oxygen, as well as liberated heavy metals that can pollute the environment. In SMS mining, sulphide in waste materials cannot react with the alkaline seawater hence acid cannot form in the ocean. SMS due to the small size of the mineral rich deposits do not produce as much waste as land mining, or leakage of minerals into the environment. On the other hand, as deep-sea mining is new, some are skeptical of claims it will have minimal impact on the environment. As part of the work of SOPAC (the Applied Geoscience & Technology Division of SPC) which provides technical support and advice to Pacific Islands countries, the division has been assisting countries to improve technical capacity, community involvement and government management of deep sea mineral resources. One of the elements of the Pacific Deep-Sea Minerals Project, started in 2011 with funding from the European Union, is that it recommends national policies and laws before any mining takes place. Papua New Guinea is one of the places that has also struggled with balancing economic development and the environment (for example, the Ok Tedi mine was previously held up as a case study of irresponsible, polluting mine development). In PNG, Wenceslaus Magan, from Mas Kagin Tapani (Guardians of the Sea), said in order to believe deep-sea mining by Nautilus Minerals could be sustainable, he needed to see it: “There has never been a deep-sea mining occurring anywhere in the world from that depth—5000 metres deep. “So theory is one thing, but actually doing it and experiencing the impact of that is another thing, so I’m not going to buy into what Nautilus has said. Because like all miners, they have to come up with something to convince the government of the day to give them the licence. So at this stage, we’d rather say that, let them go and do it in Canada first, or let them go and do it in US or elsewhere, but not in Papua New Guinea. We have to be cautious.” Another thing worrying the islanders is the pressure they feel to say “yes” or “no” to an “all or nothing” deal from mining companies, says Dr Rodgers. He advises: “Governments need to be very clear on what is it they want to get out of this. They have to have fairly definite milestones that are not negotiable and use that as a negotiating basis because there are many companies out there and governments should not look at the very first one that offers to invest. “They should actually be looking at it from the perspective of what is the best deal for my country that can give me: (a) the resources at the level I need, and; (b) that harvest the resource in a way that is environmentally and economically sustainable.”

Mining that resource?” In addition, laws are needed to be put in place Then, there are nations like the Cook Islands, SOPAC is keen to point out its advice is to protect citizens, governments and their oceans whose natural environment supports industries neutral—it does not advocate countries to say to deal with deep-sea mining. like tourism, who worry about the consequences “yes” or “no” to deep-sea mining, but it does Rodgers says: “At the moment, none of the of deep-sea mining for the future. encourage countries to ask SOPAC for advice Pacific countries and territories have properly Teina Mackenzie from environmental NGO and technical expertise so governments can make developed legislative frameworks that will guide Te Ipukarea Society (TIS) says the money from the right decisions. the protection of these resources in the countries, mining is finite and needs to be put to good use: SOPAC’s work around deep-sea mining also that will guide procedures for harvesting them “With mining—if there are going to be finanadvocates communities and NGOs are cial benefits—make sure they part of the decision making process, so really get to where they need to SOPAC provides financial and technibe, to the people, and they don’t cal support for consultation workshops get held up anywhere else or used and involvement of people in decisionin any other manner. making through other means. “In our particular case, we’ve There have long been tales of treagot nodules, and once those are sure chests of gold that lie at the bottaken, that’s it, it’s a non-renewtom of the sea, from the days when old able resource for thousands of trading and pirate ships sunk. years—so if you’re going to utilise But who would think that gold that and get wealth from it, make and other precious minerals had been sure the rest of the generations lying on the bottom of the sea all that will benefit.” time, not in treasure chests, but in the These fears need time to disseafloor itself? cuss and resolve, agrees Jonathan Who knows whether deep-sea minLowe, Vice President, Strategic ing will in the next decade become a Development & Exploration, reality for the Pacific Islands, or like so Nautilus Minerals, who muses: many tales of hidden treasure chests at “People are afraid of the dark. It’s a case of, in the absence of Dr Jimmie Rodgers (left)...time is critical. Multinationals are not going to wait to give Pacific the bottom of the sea, become just an Islands Countries time to look at studies before they come in...they push in. Photo: SPC illusion, out of reach? knowledge, their default reaction At least, nowadays, we do not need is to be conservative and worried, to consult treasure maps and ruand that’s probably a well-learned mours—we know a lot more about what minerals habit over time. in a way that is sustainable and protects the enviare there and how to get them. “And so what we’ve got to do is shine the light ronment, and therefore the danger is that when With the right information, we can weigh the into those dark corners and explain what we’re multinational companies see this as a resource, pros and cons to decide about what to do with doing and show that there is nothing to fear when they’re not worried usually about the countries. the minerals lying deep beneath our shores. you switch the light on.” What they’re worried about is, how do we get

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Islands Business, June 2013

Mining Viewpoint

Sea-bed mining–riches or regrets?

By Aliki Faipule Foua Toloa*

on social and environmental criteria, preferably turned into national laws. As Dr Pettersen expressed it a couple of months back: “We need to know how to negotiate and drive a hard deal. We have to prepare ourselves as best we can by developing our negotiating skills, along with a network of people that we trust and know…and for our communities to benefit while the environment is protected as best we can.” I would also argue that as far as we can, we should harmonise standards across the region to prevent companies “picking off ” countries that are less able or less willing to enforce strict rules. But there are other things that we can and should be doing that entail looking beyond our own region. One takes us into the international parts of the seabed, beneath the high seas, that are regulated by the International Seabed Authority (ISA). When companies mine minerals from the international seabed, the ISA’s constitution says that some of the profits have to flow to the

seas, which make up nearly half of the Earth’s surface. Last month saw the launch in Paris of a new “Appeal for the High Seas”, backed by the French government; among other things, it argues that high seas biological resources should come under ISA rules and be subject to the same benefit sharing regime as seabed minerals. Maybe that is something the Pacific should endorse, maybe not; but it is certainly a debate in which we should be engaged.

acific islands are set to become the global frontier for a new industry—the mining of minerals from the seabed. The industry carries plenty of potential for controversy, for reasons that should be obvious to anyone familiar with mining on land, in our region and elsewhere. How much of the proceeds will flow to the people of the Pacific? How will the industry affect communities? How many local people will be employed, and on what grade Not powerless of job, with what working conditions? What And I would make one point very strongly; we will be the impact on nature? Who will really are not powerless before commercial interests, as be in control? we once were. For example, we are progressively Pacific islands governments have been discussregaining control of our fisheries. Establishing ing and debating these questions for several years, marine protected areas, kicking out illegal vesand we have some proposed answers in the form sels and setting science-based quotas are three of the Secretariat of the Pacific Community’s of the measures we are taking forward in our Regional Legislative and Regulatory Framework. own waters. Even so, the concerns I raised above are very real. In the Nauru Agreement, we are ahead of They are, for example, causing significant delay the rest of the world in establishing a mechato the Solwara 1 project in Papua New Guinea. nism designed to ensure that foreign fleets act This indicates that minresponsibly in areas that ing companies as well as are technically beyond our governments need to take national jurisdiction. the peoples’ issues seriously. If we can do this with fish, If they do not, operations we can do it with seabed will be disrupted and perminerals. But there is one haps even cancelled. key difference: whereas fish Last month, at the kind are a renewable resource if invitation of Minister Anwe manage them properly, thony Lecren of New Caleminerals are not. They are donia, I had the honour of a once-in-forever opportudiscussing these issues with nity to build wealth for our representatives of other Paislands and our children. cific states and territories at If we are to make that the Oceania21 environment wealth last beyond a single meeting. The Global Ocean Commission...discussed seabed mining recently at its inaugural meeting in Cape generation, we must look I outlined what I see as Town, South Africa. Back row: Ratan Tata, Simon Reddy (Executive Secretary), Robert Hill, Trevor Manuel further afield for best practhe issues and challenges (Co-chair), Aliki Faipule Foua Toloa, David Miliband (Co-chair). Front row: Sri Mulyani Indrawati, Cristina tice. We can look to Norway, facing Pacific islands as we Narbona, José María Figueres (Co-chair), Obiageli Ezekwesili. Photo: Global Ocean Commission for example. Decades ago, it address this new frontier. made a far-sighted decision And I was struck by the level of concern, both for to place a proportion of revenue from exploiting developing world, to aid economic and social local communities and for the environment. But its North Sea oil and gas fields into a special fund. progress. But the rules on benefit sharing have I was also struck by the potential of the industry It is commonly known as the Oil Fund and not yet been agreed. to help our islands, if it is done properly. Prices is now worth US$700 billion. It is the largest The first ISA mining concessions are likely to for copper, silver and palladium rose fivefold pension fund in Europe, despite Norway having come in the next decade, and to be in the Pacific. between 2004 and 2011; if the right deals are a population less than 10% of France’s or the So we have a strong interest in how the rules struck with companies mining these minerals UK’s. When money from the fund is invested, it are written and in ensuring that environmental from our seabed, some of these high prices can has to follow ethical guidelines; companies that standards are upheld. Pacific governments can benefit our people. contribute to torture anywhere in the world, for and should be involved in that process and be The so-called “rare earth” elements such as example, are banned. The capital sum, boosted by active and vocal participants in ISA’s deliberations. neodymium, dysprosium and samarium are some of the return on investment, is retained for Another issue that has been highlighted especially important in the “green economy”, in the benefit of future generations of Norwegians. through my role as a Commissioner on the technologies such as wind turbines and electric This might not be precisely the right model for Global Ocean Commission, a new independent cars, which can help industrial countries to reus, but its existence shows that there are ways to initiative on governance and management of the duce their carbon dioxide emissions. turn a non-renewable resource into something high seas, is the extraction of biological resources that yields consistent, sustainable benefits for from the ocean. Prepare for seabed mining future generations. This is something for which Following the agreement made at the UN So I would endorse the views expressed at variwe should all be striving, and I would urge Pacific Convention on Biological Diversity (CBD) ous times over the last year by a number of senior peoples and Pacific governments to begin discusmeeting in 2010, companies cannot simply take figures in our region, including Tonga’s Deputy sions soon. The era of seabed mining is coming; biological resources, make products out of them Prime Minister Samiu Vaipulu; SOPAC Director we need to be ready for its arrival. and keep the profit; they have to acknowledge and Dr Mike Pettersen; and SPC Director-General reward the place of origin. But there is one huge • Alike Faipule Foua Toloa is Minister for Energy of Tokelau Dr Jimmie Rodgers. We need to prepare for the part of the world where this benefit sharing does and a former Ulu (head of government). He is a Commissioner era of seabed mining; we need a tough set of rules on the Global Ocean Commission. not apply: the international waters of the high

42 Islands Business, June 2013

Agriculture Along with an investment of Tonga Pa’anga $500,000 (US$287,000) in the first year, Queen’s involvement also comes with a band of incentives for farmers in terms of prices. “TOP$3 will be paid per vine in staged payments to fund the re-establishment of the vines to a productive condition,” said Jones. “The farmers will then receive a guarantee from Queen to purchase their vanilla at TOP$13 per kg of green beans or up to TOP$125 per kg for cured A grade beans.” Last year’s price at the local market, Jones added was TOP$9 per kg of green beans. Queen is coming with a better offer—TOP$3 per vine rehabilitation payment, plus TOP$13 per kg green beans; plus paying for organic certification; plus a five-year purchase contract. Under the project, farmers will work towards achieving organic certification for their plantation, adding value to their already globally renowned and sought after vanilla beans. “The price is also guaranteed never to fall below fair trade prices (see: www.fairtrade.net) for Ian Jones (right)...as Queen Fine Foods’ man in Tonga, he will help revive the vanilla industry. Photo: Ian Jones the Oceania region,” said Jones. That might put local prices on a spin for a while as Queen is not the only one sourcing its vanilla from Tonga. Across the Tasman, Tauranga-based Heilala Vanilla is also likely to increase its supply of Tongan vanilla after a successful breakthrough in the Japan market. It is one of 28 enterprises supported by the European Union-funded Increasing Agricultural Commodity Trade (IACT) Project, implemented by the Land Resources Division of the Secretariat of the Pacific Community (SPC). After a successful product display at the World Food and Beverage Expo 2013 in Tokyo in April, Heilala scored a new market for its brands of vanilla-based products, adding Japan to its list of markets, which already By Dionisia Tabureguci include New Zealand, Australia, Malaysia, Singapore and the United States. Tonga’s vanilla industry is looking promisHeilala Vanilla, owned by Jennifer ing again as local growers and exporters clinch Boggiss and her father John Ross, benew deals likely to lift output over the next year. gan operation in 2002 as an aid project This comes as the island kingdom enters a very after a cyclone destroyed a local village. difficult phase economically and any progress in It has now turned into a business local industries is an important contribution to that supports local livelihood, capitalisits recovery. ing on a crop that Tonga is well known “The vanilla industry used to be very strong for throughout the culinary world. many years ago but over time it has decreased “The variety of vanilla grown with the fluctuating international process,” Ian throughout Tonga is the Bourbon Jones, director of Vava’u-based virgin coconut oil vanilla variety, the same as in Madagasexporter Taste of Tonga told Islands Business. car (around 80 percent of the world’s Vava’u’s warm tropical climate and generally Heilala’s vanilla-based products...heading to markets including Japan, vanilla is sourced from Madagascar),” fertile soil makes it an ideal location for vanilla New Zealand, Australia, Malaysia, Singapore and United States. said Boggiss. cultivation and it is Tonga’s vanilla growing cenPhoto: Heilala Vanilla “Tongan vanilla is renowned to have ter. But Tonga’s vanilla heydays are gone. a very high vanillin (primary compo“Only 105 of the plantations are currently nent of vanilla bean extract) content when picked, producing vanilla beans. Most are neglected,” curing. cured and dried according to quality practices.” said Jones. Jones, a director of Vava’u-based Taste of Tonga Heilala Vanilla farms are based in Vava’u and He plays a key role in a new partnership and principally a virgin coconut oil exporter, will it has built up its supply chain over the last 10 between local vanilla growers and Queen Fine help this vanilla project as Queen’s man on the years to now include a number of key growers Foods, an Australian-based family-owned busiground in Vava’u to roll out its vanilla revival throughout Tonga, said Boggiss. ness specialising in the development of vanilla plans. His business acumen, management and Tonga’s vanilla, according to its trade statistics, products and their distribution in Australia and leadership skills and good relationship with is exported largely to New Zealand and a minisNew Zealand. farmers in Vava’u will see him administering the cule volume to Canada. It is one of the kingdom’s Queen’s investment, significant by Tonga’s quality and training programmes. five major exports commodities. The other four vanilla industry scale, will see the development When this edition went to press, 91 farmers are fresh and chilled fish, ground and unground of the Queen Vanilla Curing Certification Course had joined the scheme and according to Jones, the kava, root crops and squash pumpkins. (QVCCC) to help grower members of the projections are that through this project, Tonga’s Most recent data shows vanilla earned scheme develop sustainable farming practices. annual cured vanilla beans production will inUS$537,000 in 2011, US$122,000 in 2010 and It will also provide farmers with the critical crease from the current less than five tonnes a US$237,000 in 2009. curing facilities and farmers’ education in vanilla year to 20 tonnes in two years’ time.

Tongan vanilla to bounce back

Top brands to drum up production

Islands Business, June 2013 43

Business Intelligence

Can PNG cope with another LNG?

apua New Guinea’s A$20 billion LNG Total Oil has been reserved with its plans but Oil LNG. project is only months away from yielding search last month openly declared and talked up A key objective for the company is to capitalise dividends, but already a new group of global the company’s exploration venture in the Gulf of on the asset base being built by the initial LNG and prospectors are lining up to commence a second Papua with prospects of establishing a stand-alone add a third and possibly fourth LNG train used to project of similar nature. LNG project if needed. liquefy that natural gas. French giant Total Oil and Australian Oil With the current Mobil-Exxon-operated LNG “An expansion of PNG LNG is regarded as the Search—both familiar with potential riches in the project presumably 80% complete, there is growhighest-value opportunity in our growth portfolio,” vast PNG fields—are talking up their chances of ing hopes that sales will begin in early 2014 with Oil Search chairman Richard Lee told shareholda new liquefied natural gas project in the Gulf of handsome rewards for Oil Search as it has a 29% ers. Papua even before the flagship LNG project gets off stake in it. “The discovery of a sizeable gas accumulation the ground. at P’nyang South in early Partly PNG govern2012 has brought us a step ment-owned, Oil Search closer to underpinning an has in recent years been Ok Tedi Mining Limited (OTML) has commisexpansion, with further engaged in exploration, sioned a rubber recycling plant to do large scale material gas resource updevelopment and pro- recycling of haul truck tyres and conveyor belts, side in the (PNG) Highduction of oil and gas which is a first in the mining industry. lands being tested over in PNG. As part of its the next 18 months by an Located at the old tyre yard in the Tabubil Layexpansion strategies, lists down area, away from the main road and residenextensive seismic and drillplans for a petro-chemi- tial areas, the plant will convert 30 years of stocking programme.” cal plant and compressed piled haul truck tyres that would have otherwise Oil Search’s renewed natural gas project. interest in PNG is heavbeen disposed in the landfill to a reusable product. On the other hand, ily focused on gas exploraThe plant, which was designed and purchased Total Oil has spread from Denmark, can produce about three tonnes/ tion—which it says takes around the South Pa- hour of rubber granules (pictured) and separates precedence over the oil cific in the last decade and removes the steel reinforcement wires from the business with the latter beor so—capturing markets tyres and conveyors for recycling. ing run to fund gas expanand creating operations sion. Their optimism is ridWith a past of environmental misfortune during in Australia, Fiji, French its BHP days, redemption in the form of a rubber ing high for another LNG Polynesia, New Caledo- recycling plant is a tick in the box towards achievproject despite the initial nia and PNG. venture incurring higher ing OTML’s bigger vision of reducing its environKnown as one of the mental foot print in the Western Province. world are fixed firmly on what we have achieved exploration expenses—forcworld’s six ‘super-major’ OTML Managing Director and CEO, Nigel and the progress we will make over the coming ing Oil Search’s profits oil entities behind such Parker said; “The use of recycling mine tyres in months.” —Story and picture by OTML Media down 13.2% in 2012 to big names as Dutch this way is a world first and the eyes of the mining and Public Relations Department A$176 million. Shell, Mobil and Caltex, With a market capitaliFrance’s Total Oil has businesses covered in the sation of nearly $3 billion, Oil Search is undisputaentire oil and gas chain—from crude oil and natuFloating LNG? bly the largest oil and gas exploration and developral gas exploration and production to power gen“Development options include stand-alone ment company incorporated in PNG, extending a eration, transportation to refining and petroleum LNG, floating LNG or integration with existing 17.6% stake for the government there. product marketing. infrastructure,” Oil Search’s chief executive, Peter The alliance between Total Oil and Oil Search Between the two, they have a mega conglomerBotten outlined last month at their shareholders’ gained momentum last October when they jointly ate in mind for a new LNG project in PNG with meeting in Australia. acquired five new licenses to operate in the onshore potential to rake in billions of dollars for the local He added that the company was examining prosand offshore Gulf of Papua and the eastern foreeconomy, as well as their own coffers. Though pects beyond the foundation of the initial PNG lands area. —Davendra Sharma

OTML’s rubber recycling plant in business

Lifou delegation targets Fiji tourism

delegation from the province of Lifou in New Caledonia wants to establish stronger socioeconomic and traditional ties with Fiji. And top on their wish list is to see how they can develop tourism which has worked for indigenous Fijians. Lifou Government representative Rene Kaudre, who led a delegation to Fiji last month, said they are here to look at a number of areas they hope they can develop in their province. “We do not have large industries or factories where our locals can get employment nor do we have big hotels like here in Fiji,” he said. “But we do have resources like land, sand and sea and agricultural prospects which we believe can assist us.” Large cruise liners berth off the coast of Lifou and passengers are ferried ashore in smaller boats

44 Islands Business, June 2013

Caledonia, bringing in 277,941 passengers compared to 134 ships in 2011 with 235,684 passengers. While tourism is a major industry on the island, they also export copra, rubber, vanilla and sugar cane. “We are looking at tourism that benefits the grassroot level and involves traditional aspects,” Kaudre said. The group visited the Garden of the Sleeping Giant and the mud pools in Nadi. “We want to see the connection between Lifou delegation…at the Holiday Inn in Suva. Photo: Islands Business tourism and the local people,” Kaudre added. “In Lifou, we have bures not fancy kinds of structures and some of us here own some hotels in Lifou. We hope to attract more visitors this as tourists try to get a glimpse of some limestone year after our fact finding mission,” he said. caves and spectacular dive sites there. —Robert Matau In 2012 alone, 159 cruise ships visited New

Young Cook Islanders to join tourism: Crocombe By Robert Matau

ata Crocombe is a Cook Islands hotelier who believes that tourism studies should be introduced early into schools so young Cook Islanders can get a first-hand taste of how important the industry is to their nation. The managing director of the Rarotongan Beach Resort and Spa told Islands Business that tourism in the Cook Islands offers a long-term career in a growing industry. A recent study by the South Pacific Tourism Organisation estimates that tourism in the Cook Islands employs between 4,500 and 6,000 full-time employees of which 1800 are believed to be expatriates, but there are no reliable statistics available. Crocombe said many Cook Islanders may have their eyes focused on other green pastures than their own islands. “Cook Islanders have free access to New Zealand and Australia, so over 95 percent of Cook Islanders live there,” he said. He said while New Zealand could offer more training to young Cook Islanders in tourism, it could be more meaningful if that training was through the use of internet and online courses. “Students who go to New Zealand rarely come back to the Cook Islands,” Crocombe said. He said hiring expatriate staff was nothing new as many countries around the world hire foreigners to work in their tourism industry. “Tourism is the number one industry in the Cook Islands by far and should be part of the school programme,” he said “The industry has grown steadily over the years despite substantial migration to New Zealand and

agree with, he and other tourism operators generalAustralia. ly felt there was an opportunity to increase tourism Crocombe himself got involved in the tourism education at school level to make it more attractive industry, the prime driver of the country’s economy for islanders. which generates more than 75 percent of the Gross As far as education needs are concerned for the Domestic Product, through purchasing the RaroCooks, the study found that: tongan Beach Resort. • Approximately 300 children leave Hesays it is a career path that ofschool every year with 60 high school fers a lot of potential for young peostudents on Rarotonga doing NZQA ple looking for a challenging career. tourism courses (20 level 1, 28 level 2 “It also offers opportunities for and 25 level 3) at Tereora College. Pacific Islanders to become owners of • The Rarotonga USP campus has their own businesses.” limited capacity to deliver tourism reHis comments are in response to lated programmes with one director, the latest South Pacific Tourism Or2 admin staff and 2 part-time course ganisation study on human resource coordinators with 12 students enrolled challenges in the tourism industry for in the USP Bachelor of Commerce in Pacific Islands nations. Hotel Management. The study has found that in the • Both the in-country interviews Cook Islands there is a shortage of and survey findings point to a marked skilled local labour. lack of cooperation between industry “While no official statistics are and training providers in the Cook available, estimates of some 1800 forTata Crocombe: tourism Islands. eign workers working in the industry should be part of the school • The Cook Islands Hospitality and (mostly in tourism related activities) c u r r i c u l u m . P h o t o : Ta t a Tourism Training Centre has potential have been provided by local stake- Crocombe but is currently struggling with limited holders,” the study states. facilities and the winding down of a past alliance “Some operators felt this was simply a matter of with WELTEC in New Zealand. There are currently doing business and that the impacts on visitors and 12 students in the programme and while staff are community were negligible at worst. committed and passionate, they lack critical mass. “Others were concerned that the heavy use of • Overall, there is concern on the part of the expatriate labour diluted the ‘sense of place’ preindustry about the quality and quantity of training sented to the visitor and also meant that “tourism that can be done on the island for their staff. Many operations are increasingly separated from the comlook at overseas options (either trainers come to the munity”, leading to greater tensions between locals Cooks or staff go overseas) or resort to purely rely and tourism, including issues of theft.” on in-house training. While this was one issue Crocombe did not

Tonga to scrap consumption tax on new business?

onga is working hard to provide attractive incentives to lure foreign investors to invest in the kingdom. The country’s deputy Prime Minister Samiu Vaipulu last month told a group of Chinese businessmen that his government was looking at doing away with the 15% consumption tax levied on new businesses. He also outlined government’s efforts to develop Tonga’s infrastructure, which would be beneficial to any investment in Tonga. These include a high speed fibre optic telecommunication network and the signing recently of an open skies agreement with Singapore which allows airlines of both countries to fly between Singapore and any points in Tonga without restrictions in capacity, frequency or aircraft type, and bringing cheaper bulk fuel supply direct from Singapore. A Chinese business delegation was in Tonga last month to look at investment opportunities and attend a meeting organised by the Tonga Chamber of Commerce and Industries. Tongan government officials told the Chinese delegation that: • Tourism is “Tonga’s most vibrant industry”; • Tonga has fish to give for fishing boats; and • It will speed up the issuance of licences to fish in Tonga’s waters. Tonga in June last year signed a US$25 million grant agreement with China, under which China would provide Tonga an aircraft for its domestic air service, training of Tongan pilots and engineers, and the maintenance of the aircraft for three years. —PACNEWS/Matangi Tonga

Remittances can transform rural areas

ast month’s Global Forum on Remittances jointly organised by the International Fund for Agricultural Development (IFAD) and the World Bank ended with the private sector, civil society and policymakers determined to make every dollar count that migrants send home to their families in rural areas. More than 350 participants from across the globe gathered in Bangkok for the three-day Forum, which ended with a key message from delegates and participants: Empowering the millions of remittances recipients in rural areas can provide a pathway out of exclusion, as well as improved livelihoods. The common goal of the participants—central bankers, money transfer operators, postal networks, and microfinance organisations—was to identify strategic ways to invest the US$450 billion migrants send home annually to their families. “We know that out of the nearly US$500 billion sent in global remittances every year, around US$220 billion go to people living in poor and remote villages,” said Kevin Cleaver, Associate Vice-President of IFAD. “We now have a clear mandate—harness the power of this money to change their livelihoods.” Often central bank regulators are held accountable for slowing down remittance flows with excessive regulation. The deliberations and good practices highlighted at the Forum by Asian policymakers revealed that an enlightened regulator is a powerful ally. Panellists from the private sector, such as Western Union and mobile phone companies from the Philippines, demonstrated their commitment to align transfer costs with the G20’s ‘5 percent in 5 years’ or 5x5 initiative. “Is it a dream to ask remittance service providers to adopt some sort of corporate collective objective around the 5x5? Maybe not, after what we’ve heard at the forum.” said Massimo Cirassino, World Bank remittance expert. —ifadnewsroom@ifad.org Islands Business, June 2013 45

Culture

Scholars digitise endangered languages

commercial share-alike’ license. “Any use of material from the collection for commercial purposes would have to be negotiated with the depositor and, if possible, with the speaker,” Thieberger said. “Any materials made available by PARADISEC are covered by an agreement that means we can identify anyone who subsequently misuses material. PARADISEC has barely enough resources to operate, let alone to be able to locate speakers represented in the collection. We feel it is a valuable resource for those speakers and for cultural agencies in their countries, like the Vanuatu Cultural Center or the Institute of Papua New Guinea Studies to have access to,” he added. While the copyright issue is pertinent, the benefits to native custodians of collections of their art forms have immeasurable value. For endangered languages such as those in the PARADISEC collection, it is usually an opportunity for custodians to remember aspects of their cultures facing imminent extinction. “In my experience, speakers of indigenous languages typically want them to have some presence on the web, or more generally, that people elsewhere in the world should be able to learn about that particular language. “Most EC has little monetary value to outsiders, but has enormous value to the speakers who value finding recordings of their relatives in a collection like ours. “There are a number of examples of records from our collection being taken back to source communities by reA copy of the earliest work...found in the PARADISEC collection. Source: searchers, thus generating a http://paradisec.org.au/fieldnotes/image_viewer.htm?VETH102,10,1,L great deal of interest in the present-day descendants of the original speakers. “In my experience, it is more common to find “We also have messages from people who have people I have worked with want their language found their own relatives and being able to access and recordings to be available for other people the recordings online and greatly appreciate it,” to listen to and learn about the village or island said Thieberger. that it comes from. The PARADISEC collection is made up of “Every item in the PARADISEC collection has recordings of some music, songs as well as spoken access conditions that specify how it can be used. narratives from everyday conversations. These are applied by the depositors and we trust The earliest works in the collection are found that they have negotiated them with the people in Arthur Capell’s papers, dated the late 1800s, recorded. In the case of legacy collections—those while audio recordings began and are dated in made before it was required to have consent the 1950s. forms signed by the speakers—we weigh up the PARADISEC describes Capell as an Australian benefit of making the material available against linguist and ethnographer who spent much time the cost of hiding it. recording and documenting both Australian “There is also a problem with research instiAboriginal languages and endangered languages tutions closing access to research materials that in the Asia-Pacific region. would benefit. Again we have to weigh up the “We have worked with cultural agencies in the benefit of closing a collection on the chance that Pacific and would like to do more of that, and it may possibly contain material that is sensitive, to digitise analog recordings that may otherwise and which we are in no position to judge since it become unplayable. We currently have a funding is in a language we do not understand, against the application to work with the Solomon Islands need for speakers to access it,” Thieberger added. Museum and Archives to digitise over 700 tapes PARADISEC contains languages from most in their collections. But we also have a backlog of Pacific countries, said Thieberger, but the bigger tapes that need work and we need to find funds to collections are from Vanuatu, Papua New Guinea, pay for getting this work done,” Thieberger said. Fiji and Solomon Islands. PARADISEC is also an avenue where ethnoAs standard procedure, its IPR protection graphic researchers can send text, audio and visual mechanism protects each item in the collection materials to be preserved and remain discoverwith its own access condition while the entire able, particularly to interested communities. collection has a default Creative Commons Non-

Intellectual Property protection assured By Dionisia Tabureguci Some languages from the Pacific islands are part of a significant collection of endangered languages that have been added onto the United Nations Educational, Scientific and Cultural Organisation’s Australian Memory of the World Project (UNESCO Australian MOW). The collection PARADISEC (Pacific and Regional Archive for Digital Sources In Endangered Cultures), co-managed by the University of Melbourne, was created to digitise research and cultural records to make sure they don’t get lost, damaged or destroyed. PARADISEC is now available on UNESCO’s Australian MOW—MOW being an international project that aspires to preserve documentary evidence of humanity to prevent collective memory loss, which may result if these documents or recordings are lost or stored in forms that are no longer supported by technology. “The archive contains over 8900 entries based on research and projects on endangered languages and cultures around the world,” said Dr Nick Thieberger, a senior research fellow in the University’s School of Languages and Linguistics and a PARADISEC Project manager. “There are nearly 2000 languages spoken in Australia, the South Pacific Islands and Southeast Asia and most of these have never been recorded, much less studied. “A large number of these languages are in such decline that only a few hundred will be spoken in the next century,” Thieberger said. But in a region well known for having a low level of Intellectual Property Rights (IPR) protection when it comes to Traditional Knowledge and Expressions of Culture (TK & EC), the handling of what belongs to indigenous Pacific Islanders comes with some concern. In the past, similar collections of traditional art forms have ended up being exploited, used for commercial purposes and distributed overseas while traditional custodians are not acknowledged, much less benefit from any monetary gain. The blame is usually put on the lack of awareness in Pacific islands countries of the urgent need to put in place measures to protect IPR of TK and EC and ways that indigenous custodians can benefit from these resources. In this light, works such as the PARADISEC collection may be seen to increase the vulnerability of indigenous Pacific Islanders by making what they own easily accessible to the world. “It is an issue that we are well aware of, that there are people in this world who will act in disrespectful and illegal ways,” said Thieberger. “On the other hand, researchers each have their own relationships with the people they work with and make recordings in good faith, usually with some kind of formal consent discussion between them and the people recorded. 46 Islands Business, June 2013

RAMSI Update

Leading the way…Solomon Islands Prime Minister, Gordon Darcy Lilo (left) congratulates the Permanent Secretary for Finance and Treasury, Shadrach Fanega, at the signing of the Performance Agreements. Photo: RAMSI Public Affairs

Solomons leads the way on gender in the public sector The Solomon Islands is now leading the region in mainstreaming gender as an issue that needs to be addressed urgently within the public sector as Johnson Honimae reports

n a game-changing decision, the Solomon Islands Public Service Commission recently nominated gender as one of the key cross cutting issues to be used to assess the performance of all heads of government departments. Chair of the Solomon Islands Public Service Commission, Eliam Tangirogo who is leading the reform from within, says it is the first time that gender mainstreaming has been included as one of the principal accountabilities in the Permanent Secretary Performance Agreements. “This is a very positive step,” he says. “The Gender Equality and Women’s Development Policy is an approved government national policy and so it’s only logical and in the national interest that we consider this as an opportunity to further the progress of our women. “We now have data on women in the country, but we need to have a plan of action so that we can see where we’re going and where we can improve. He says by including gender mainstreaming in the performance agreements, the commission is making sure that something gets done about implementing the commitments of the government—both nationally and internationally. “We can’t just depend on the Ministry of Women, Youth, Children and Family Affairs to do the work. We must all take leadership and

responsibility for it,” said Tangirogo. “I have attended several public service conferences in the region and other public services regularly report on their achievements in gender mainstreaming and are very proud of their achievements. But now Solomon Islands Public Service should also be able to report on progress and achievement in advancing gender issues in its public sector.” In the new performance agreements, all the permanent secretaries are expected to have in their ministries the following under the key result area of gender mainstreaming in the public service: • Have a gender implementation strategy as a part of their corporate plan; • Appoint a gender focal point/gender desk; • Evidence of gender sensitivity within the recruitment and selection process in the ministry; • Gender profiles and statistics collected and disseminated; • Zero tolerance on work place harassment including sexual harassment; and • Gender report to be part of the monthly and annual reporting processes. The Ministry of Women, Youth, Children and Family Affairs(MWYCFA) who has played a key role for inclusion of gender mainstreaming in the

permanent secretaries’ performance agreements, will continue to play a role in supporting permanent secretaries and their ministries. “The leadership shown by the Public Service Commission for inclusion of gender mainstreaming as one of the principal accountabilities for permanent secretaries has given new impetus for the implementation of the Gender Equality and Women’s Development Policy,” says Josephine Kama, the ministry’s national gender adviser. Kama, whose position has been funded by the Regional Assistance Mission to Solomon Islands (RAMSI), emphasised that this will also greatly assist in the implementation of international conventions on gender mainstreaming including the Convention on the Elimination of all forms of Discrimination Against Women (CEDAW). RAMSI’s gender adviser, Emele Duituturaga, who has played some role in raising awareness with the Public Service Commission on the issue of gender, described the move as a “real game changer and a major force for addressing gender equality and women’s advancement in the management and delivery of public services.” “It is a major achievement and the first of its kind in our region,” said Duituturaga, who is from Fiji and has done a lot of work on gender issue in the region and internationally. “This gender mainstreaming approach means that it’s the Solomon Islands Public Service Commission who has taken this up as a reform measure and not just leaving it to the MWYCFA to be agitating for gender equality. “Essentially what this means is that the PSC has taken up the responsibility to hold permanent secretaries accountable for implementing Solomon Islands government’s obligations under CEDAW which it ratified in 2002 and the national Gender Equality and Women’s Development Policy, endorsed by Cabinet in 2010,” Duituturaga said. Islands Business, June 2013 47

TRADE MARK CAUTIONARY NOTICE IN PALAU Notice is hereby given that DIAGEO BRANDS B.V., of Molenwerf 10-12, 1014 BG Amsterdam, The Netherlands, is the sole owner and proprietor in Palau and elsewhere of the trademark below:

KEEP WALKING which is used in International Class 33 upon or in connection with the following goods: Alcoholic beverages Diageo Brands B.V. claims all rights in respect to the above trademark and will take all necessary legal steps against any person, firm or corporation counterfeiting, imitating, violating or otherwise infringing its rights in Palau. MUNRO LEYS Lawyers & Notaries Public Pacific House, Butt Street, PO Box 149 Suva, Fiji

RED LABEL which is used in International Class 33 upon or in connection with the following goods:

Alcoholic beverages Diageo Brands B.V. claims all rights in respect to the above trademark and will take all necessary legal steps against any person, firm or corporation counterfeiting, imitating, violating or otherwise infringing its rights in Palau. MUNRO LEYS Lawyers & Notaries Public Pacific House, Butt Street, PO Box 149 Suva, Fiji

JOHNNIE WALKER GOLD LABEL which is used in International Class 33 upon or in connection with the following goods: Alcoholic beverages Diageo Brands B.V. claims all rights in respect to the above trademark and will take all necessary legal steps against any person, firm or corporation counterfeiting, imitating, violating or otherwise infringing its rights in Palau. MUNRO LEYS Lawyers & Notaries Public Pacific House, Butt Street, PO Box 149 Suva, Fiji

JOHNNIE WALKER which is used in International Class 33 upon or in connection with the following goods: Alcoholic beverages Diageo Brands B.V. claims all rights in respect to the above trademark and will take all necessary legal steps against any person, firm or corporation counterfeiting, imitating, violating or otherwise infringing its rights in Palau. MUNRO LEYS Lawyers & Notaries Public Pacific House, Butt Street, PO Box 149 Suva, Fiji

BLUE LABEL which is used in International Class 33 upon or in connection with the following goods: Alcoholic beverages Diageo Brands B.V. claims all rights in respect to the above trademark and will take all necessary legal steps against any person, firm or corporation counterfeiting, imitating, violating or otherwise infringing its rights in Palau. MUNRO LEYS Lawyers & Notaries Public Pacific House, Butt Street, PO Box 149 Suva, Fiji

GREEN LABEL which is used in International Class 33 upon or in connection with the following goods: Alcoholic beverages (except beers) Diageo Brands B.V. claims all rights in respect to the above trademark and will take all necessary legal steps against any person, firm or corporation counterfeiting, imitating, violating or otherwise infringing its rights in Palau. MUNRO LEYS Lawyers & Notaries Public Pacific House, Butt Street, PO Box 149 Suva, Fiji

GENUINE PARTS Insist only on Toyota Genuine Parts. Your local Toyota dealer stocks a wide range of Quality Toyota Genuine Parts. Champion Parts Advisor - Jese Tabua from Asco Motors Fiji 2013 TTSPH Group Skills Contest Winner

The Quality of our Service ensures the best quality parts, are fit by the best quality people. This guarantees our work will ensure you a safe journey home, for you and your family.

QUALITY SERVICE

Champion Service Advisor - Julie Ann Baekisapa from Ela Motors Solomon Islands 2013 TTSPH Group Skills Contest Winner

WINNING TECHNICIANS Champion Technician - Ravin Nilesh Lal from Asco Motors Fiji 2013 TTSPH Group Skills Contest Winner

The team of Toyota technicians across the South Pacific, provide a high calibre of workmanship and take pride in their work, giving you assurance of looking after your motoring investment.

The Winning team across the South Pacific can be found at Ela and Asco Motors. Toyota believes in only striving for the best and have invested heavily over the past twenty one years, in bringing future champions together to compete in the TTSPH Group Skills Competition. This competition brings the best of the best from the seven different South Pacific countries showcasing talent and ability to work under pressure. Held at the TMCA Headquarters in Sydney Australia, Fiji took out both the Technician Champion as well as the Parts Advisor Champion titles. while Solomon Islands took out the Service Advisor Championship. This is the second year in a row that Fiji has taken out the prestigious Technician Championship which will see the winner, Ravin Nilesh Lal, represent the South Pacific in Japan at the Annual Assembly of Champions held later this year. So the next time you need to have your vehicle serviced, you can rest assured that you are in the hands of Champions throughout the South Pacific.

1419IB

Papua New Guinea Ph: (675) 322 9400 Solomon Islands Ph: (677) 30314

American Samoa Ph: (684) 633 4281 Samoa Ph: (685) 20800 Fiji Islands Ph: (679) 338 4888 Tonga Ph: (676) 23500 Vanuatu Ph: (678) 22341

Holding Company - Toyota Tsusho South Pacific Holdings Pty Ltd - www.toyota.tsusho.com.au