November 2013

November 2013

Vol. 39, No. 11

Contents 34 Gizo airport opens for business Now more opportunities

for economic growth

35 Palau takes fisheries surveillance to new heights Aerial unmanned vehicles

to monitor EEZ

Technology

36 Airship for the islands?

Taking advantage of

new technologies

Health TUNA SHOWDOWN: Pacific islands versus distance water fishing nations. Cover report—pages 16-19. Cover photo: Giff Johnson

Cover Report

16 Tuna Showdown Pacific tuna stock faces growing crisis of inaction

Trade

20 EPA is off

37 The medicines are fake, the illnesses real The lethal trade and

its tragic consequences

38 Lifting our game in health SPC develops a

new approach

Education

39 Empowering women and supporting communities SPC’s CETC

PNG dumps solidarity to save tuna exports to Europe

celebrates 50 years

Business

Environment

22 PNG and the Asian century

Can the country be transformed by these once-in-a -century opportunities?

26 CNMI tourism on the rebound

New construction and rennovations on the rise

Politics

27 Voter apathy concerns NZ’s Pacific leaders

Youth hold balance to 2014 election

28 Just who are they arming themselves against?

Arms smuggling linked to missing royalty payments

42 SPREP moving ahead

Regular Features 6 Views from Auckland 7 We Say 12 Whispers 14 Pacific Update 40 Business Intelligence

29 The challenge of making land leases bankable An ambitious project but can be done

elecommunications T 31 Can small islands sustain two telecoms?

Marshalls market too small

Mining

32 Deep sea mining or fisheries?

Scientists say both can operate side by side

Aviation

33 Pichler reconsiders fresh alliance with Qantas Scope to broaden market prospects Islands Business, November 2013 3

Managing Director/Publisher Godfrey Scoullar Group Editor-in-Chief Laisa Taga T Group Advertising & Marketing Manager Sharron Stretton Staff Writer Robert Matau Graphic Design Dick Lee Virendra Prasad Main Correspondents

The Pacific’s Best...

Australia Rowan Callick Nic Maclellan

VOL 5 2013 AIR NIUGINI INFLIGH T WITH

Davendra Sharma Fiji Samisoni Pareti Dionisia Tabureguci T

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 Peter Niesi

Solomon Islands Evan Wasuka Alfred Sasako T Tonga Taina Kami-Enoka V Vanuatu Bob Makin Islands Business is published monthly by Islands Business International Editorial & Advertising Offices Level III, 46 Gordon Street, PO Box 12718, Suva, Fiji Islands.

Tel: +679 330 3108 Fax: +679 330 1423 E-mail: Editorial: editor@ibi.com.fj Subscriptions: subs@ibi.com.fj Advertising: advert@ibi.com.fj Printing: Oceania Printers, Raojibhai Patel Street, Suva, Fiji.

© 2013

Copyright © 2013 Islands Business International Ltd. All rights reserved. No part of this publication may be reproduced without the written permission of the publisher.

www.islandsbusiness.com Islands Business, November 2013

Islands Business International has successfully established itself as the South Pacific’s leading publisher.

In publishing news magazines, inflights & entertainment magazines and publications for business, government and regional bodies, Islands Business International has gained experience unrivalled in the Pacific.

It’s this experience and depth of knowledge of the Pacific and the people that make the decisions in this part of the world that makes us the region’s best.

A fact that has been underscored by our many award successes.

If you need to advertise your products or services or want the best when it comes to your publishing needs you need to talk to us, Islands Business International.

•

• • • islands business international

46 Gordon Street, PO Box 12718, Suva, Fiji.

Ph: (679) 330 3108. Fax: (679) 330 1423. E-mail: Advertising: advert@ibi.com.fj Editorial: editor@ibi.com.fj Subscriptions: subs@ibi.com.fj

Solomons, the in-flight magazine of Solomon Airlines, is a high quality full colour magazine published every three months and is the only magazine placed in every seat pocket on Solomon Airlines international flights. It is also available at all Solomon Airlines offices and given away free to major business houses in the Solomon Islands.

Each edition of the magazine is carefully designed to include a range of interesting articles about the Solomon Islands, personalities and developments of interest to both tourists and business travellers.

So if you want to become a high flyer with Solomon Airlines why don’t you contact us today and guarantee your seat on the next flight by advertising in our inflight magazine.

Column

Views from Auckland

BY DEV NADKARNI

Man who turned the heat on global warming Last month, the steamy world of climate change heated up a couple of degrees: Just as a group of climate scientists hit the headlines saying there was new proof that 95% of global warming was because of human activity, the instant media got busy labelling a Kiribati man trying to get his visa extended in New Zealand as the world’s first ever climate refugee.

Ioane Teitiota, who faced deportation to his native Kiribati after his bid for refugee status in New Zealand following the expiry of his visa was rejected, launched a legal appeal to stay on in the country on the grounds that going back to Kiribati would put him and his family at grave risk because of the effects of climate change.

His High Court appeal detailed how king tides were causing erosion, breaching seawalls and how rising sea levels were causing crops to fail, flooding homes and polluting groundwater used for drinking.

The man’s appeal expectedly made delicious copy for the global media. Teitiota was catapulted into becoming the world’s first climate change refugee, with the mainstream commentariat and all manner of social media chatterati and twitterati sharply divided on whether the instance was a harbinger of a new class of refugee or a clever stunt surfing on the rising wave of climate change.

Teitiota’s New Zealand lawyer told the media that the case potentially set a global precedent for people of countries threatened by climate change to claim refugee status in other countries.

But do the perceived deleterious effects of climate change such as rising sea levels hold enough water to legally deem an entire nation’s population as being at risk of mass destruction and therefore qualifying for mass refugee status in another country?

Not as things stand today. In fact, the New Zealand High Court’s original decision ruled that the immigration authority was correct to refuse Teitiota refugee status, made on the claim that returning to Kiribati would pose a grave risk to him and his family because it fell short of the legal criteria such as fear of persecution or direct threats to his life—in accordance with how a ‘refugee’ is legally defined today.

War, strife, despotism and terrorism over the decades since the formation of an organisation like the United Nations has restricted the world’s view of refugees as persons who have been singled out for persecution, physical violence and threats of death because of their political or religious persuasion, gender, physical disability, age and the institutionalised or organised violation of basic human rights. A person can claim refugee 6 Islands Business, November 2013

commitments.

Countries that have been identified as most at risk will tell you how hard it has been to access promised funds for mitigation and adaptation programmes.

Leaders at the jamborees have nit picked about whether they should control emissions to “cap” warming by so-many-and-a-half degrees amid colourful protests from all sorts of people and status on the grounds of any of these violations. groups and the hawkish gaze of carbon credit Threat to life because of climate change, howmerchants—but the real issues have remained ever, has never figured in this list. Neither does the proverbial hot potato. there seem to be any concerted effort from any For instance, the opportunity to discuss and quarter to include it. begin forming some sort of potential consensus at the global level on what to do with climate A question of human rights change refugees when they become a reality— Commenting on a global report on human which, indeed, will be sooner rather than later rights in this column in April 2008, I had asked as Teitiota’s case has so emphatically shown—has the question why the threat to food and water been completely wasted by sweeping it and other supply, shelter and livelihoods of the vast majority equally important issues that put hundreds of of the people of a country because of the cumulathousands of lives at stake under the carpet. tive, prolonged irresponsible actions of distant Teitiota’s case might well be seen as a clever countries should not amount to a violation of huploy packaged in the attention arresting wrapman rights of the people of the suffering country. ping with death-by-climate-change written all To quote myself from that column: “Are huover it, designed merely to help him stay put in man rights violations to be taken cognisance New Zealand. of solely through the political prism or from But there is little doubt that it is the thin end the rigid angle of of the wedge that governmental and threatens to force administrative maopen the floodchinery of individgates of a torrent ual nations? of such claims in “Violation of the not to distant human rights by future. the abuse of the In fact, the othenvironment traner big news headscends political line on the climate borders on both change front last sides—the pollutmonth might well ers and those afaccelerate this profected by it. But cess.

Kiribati...most at risk with climate change. Photo: SPPREP that does not stop After all, we it from being a vionow have it on the lation of human authority of the rights.” world’s top scientists that climate change is caused Further in that column, I also quoted Dr 95% because of human activity. So climate change Marshall Weisler, University of Queensland is by and large anthropogenic, they say. archaeologist and renowned expert on coral atolls.

This should be music to the ears of the legal Here’s what I wrote: “Dr Weisler said rising fraternity. For it potentially opens whole new sea levels from global warming would threaten vistas to launch class action litigation on behalf the livelihoods and homes of more than 200,000 of those threatened by climate change, particupeople who live on coral atolls in the coming larly sea level rise, against the perpetrators—the generations. developed western nations that, according to the “In particular, he cited Kiribati, Tuvalu and the scientists, have been ninety five per cent responMarshalls in our neck of the woods and Maldives sible for rising sea levels. in the Indian Ocean as being at most risk. “In What’s more, legal eagles and people threatKiribati, where is the next generation going to ened by sea level rise might as well fall back on live?” he asked.

Queen Elizabeth’s words at a public function in Teitiota’s appeal last month has the ring of 2008 when she said that those who pollute the chickens coming home to roost. least suffer the most.

Teitiota may or may not go down history as the Much talk, little action world’s first climate change refugee. But he will The mega-climate change jamborees held once certainly be remembered for breaking the interevery few years around the world have always national community into a bit of a sweat while been long on discussions but woefully short on facing up to the rising heat of climate change.

WESAY ‘Consumers of these fake medicines—disadvantaged as they are because of the lack of knowledge and absence of alternative treatments not to mention the exorbitant costs of branded medication—depend on government authorities to authenticate and guarantee the safety of the medicines that are imported.

But the health departments of many developing countries, particularly in the Pacific Islands region, are miserably failing the people on several fronts’

A

dvances in the medical sciences have been progressing so rapidly in recent years that scarcely a week passes by without the world’s news media putting out a report that raises hope for the prevention of—or cure for—a long existing pestilence. Multi-disciplinary scientific and technological collaborations have pushed the boundaries of medical and pharmacological sciences into a realm where humanity can now contemplate postponing death to live diseasefree lives indefinitely.

The idea of disease-free living and lifespans extending to several hundred years is no longer the stuff of mythology or science fiction.

It is now much more than a theoretical possibility. In fact according to some estimates, it is just a couple of decades away. Along the way, rapidly developing technologies like nanotechnology will facilitate the targeted treatment of diseases at the molecular level, making cures possible for hitherto difficult to cure or even incurable ailments.

One such news report that made global headlines last month was about advances in the development of a vaccine for malaria and potentially other mosquito borne tropical diseases that have defied prevention techniques for decades.

Malaria kills more than 600,000 people in the continent of Africa alone. In the Asia Pacific region, that figure is about 50,000. In Papua New Guinea, statistics reveal 179 cases of malaria per 1,000 people.

In the Solomon Islands, the figure is 77 per 1000 people, with some 40,000 infections each year.

The scientists who developed it and the commercial manufacturer that is backing the potential preventive remedy have said that the vaccine—codenamed RTSS—might well be distributed in global markets in as little as two years, subject to continued satisfactory results to the extensive trials. The Bill & Melinda Gates Foundation is among the co-funders of the development of the vaccine.

While healthcare providers around the world are eagerly awaiting the development of the vaccine, they are also hoping that it will be affordable to be administered to all those who need it.

For unaffordability of genuine medicines is the main reason why the world—more particularly so the more deprived developing countries including many Pacific islands nations—faces a raft of problems.

Just as reports of the new potential malarial vaccine were making

the rounds in the global media last month, another long-standing narrative in the malarial saga was making headlines in several parts of the world including in the Pacific.

It is unfortunate that while such encouraging news about potential cures of dreaded diseases is making the rounds, extremely disturbing developments as regards spurious medicines that are increasing the toll taken by the diseases themselves are being reported from across the developing world, where drug regulatory practices are weaker and susceptible to malpractices and corruption.

Large swathes of Africa and Asia including the Pacific Islands have been reporting increasing incidences of spurious malarial medicines being sold with impunity, without any authentic checks on manufacturers, countries of origin, formulations, integrity of the chemicals used, packaging and so much else. The high cost of branded medicines manufactured by giant pharmaceutical multinationals put these essential medications out of reach for many of the poor in these countries that live on less than $2 a day.

This situation provides a fine breeding Hoodwinking ground for fly-by-night operators disguising the unsuspecting themselves as pharmaceuticals and hoodwinkpoor ing the unsuspecting poor and sick patients by selling them cheap, spurious medicines.

According to official figures released by the United Nations Office on Drugs and Crime (UNODC), 47 percent of anti-malarial medicines tested in the South East Asian region are believed to be spurious. Though there are no such figures for the Pacific Islands region, poor regulation and capacity for identifying and prosecuting perpetrators probably means the incidence is as high as in South East Asia.

Spurious medicines not only worsen illnesses even leading to death but what is even more worrisome is that they can cause drug resistance in a population. The Asia Pacific region has the world’s highest rates of anti-malarial drug resistance mainly because of fake medicines, according to international pharmaceutical drug monitoring authorities. The findings of international agencies and institutions following studies of spurious medicines freely available in several Pacific Islands countries make for extremely grim reading.

Laboratory analyses of some of these fake medicines have revealed their ingredients to contain such dangerous substances as lead filled Islands Business, November 2013 7

WESAY road paint, chalk or shoe polish. Many of these have been found to have medicinal ingredients whatsoever.

Consumers of these fake medicines—disadvantaged as they are because of the lack of knowledge and the absence of alternative treatments not to mention the exorbitant costs of branded medication—depend on government authorities to authenticate and guarantee the safety of the medicines that are imported. But the health departments of many developing country governments, particularly in the Pacific Islands region are miserably failing the people on several fronts.

First, they have neither the human capacity nor the knowledge and infrastructure to assay and analyse drug and pharmaceutical imports in line with world best practice. Second, they have lax customs and border controls compounded by the fact that many of these are islands with no policing of their vast coastlines. Third, they have a relatively free trading regime with emerging Asian economies like China, letting all sorts of goods in an indiscriminate manner with little border or quarantine controls.

According to the United Nations Office on Drugs and Crime (UNODC), as much as a whopping 60 percent of the world’s spuri-

ous drugs are manufactured in China. The only way in which the situation can be remedied is for groups of poorer nations to work together with international agencies on a couple of fronts. One, they must band together to negotiate the best possible prices from reputed drug manufacturers for generic formulations as has already been done by countries like India.

The removal of branding on generic formulations can make the drugs considerably cheaper. The countries should involve international agencies in these negotiations. This is not a hard thing to do. What is needed is political will. Lastly, the multinational drug companies themselves could help reduce their prices and make them affordable in poorer nations by distributing generic formulations or differently branded drugs. After all, following such a tack would help them make inroads into the whopping US$75 billion a year illegal drug market to add significantly to their own bottom lines. For if there were genuine drugs available cheaply, they could be guaranteed by governments, while helping drive the spurious illegal trade out of business.

But eschewing corporate greed is as difficult as mustering political will. Meanwhile the poor of the world suffer.

‘It is a known fact that the remoteness of thePacific Islands, tiny volume demand and the high costs of transportation conspire to make the price of fossil-based fuels among the highest in the world. Pacific Islanders pay the

highest prices for petrol, diesel and bottled natural gas than people living in most other parts of the world’

T

he world’s growth driven economic development models continue to depend heavily on energy, and by and large, the wheels of the world’s economy turn by burning fossil fuels—as they have been doing since the beginning of the industrial era. Fossil fuels, especially oil and coal, are literally and figuratively the bedrock of the energy sector and life without these is quite unthinkable at this stage despite the impressive strides made in tapping energy from alternative sources.

The fossil based energy sector’s stranglehold on the world economy is absolute. Issues related to oil production and supplies have brought the world economy on the verge of a standstill on at least a couple of occasions in the past century. Wars continue to be fought across the world around access to fossil fuels both on both geopolitical and corporate fronts. Oil rich nations have turned themselves into economic powerhouses in a matter of decades while those that are remote and dependent on supplies from distant sources have suffered and continue to do so.

Despite periodic episodes of fear generated by studies that there is only so much oil in the bowels of the earth, which will soon run

8 Islands Business, November 2013

out, its consumption continues unabated, just as investment into finding new repositories of fossil fuels increases with each passing year. New prospecting technologies coupled with newer extraction techniques are leading oil companies to the far corners of the earth—deep into sea beds and underneath the polar pack ice. The world’s forays into tapping alternative sources of energy seem far behind the race to find new repositories of fossil fuels.

Oil is still king and by the looks of it, will remain so for at least a few decades—even if giant strides are taken in progressing projects to tap alternative energy sources. Meanwhile, the stranglehold of the fossil fuel sector on the world’s economy will only grow stronger.

And the growing protestations of environmentalists and ecologists seem to be making little impact, if any, on the unstoppable juggernaut that is the fossil fuel industry.

It is a known fact that the remoteness of the Pacific Islands region, the relatively tiny volume demand and the high costs of transportation conspire to make the price of fossil based fuel among the highest in the world. Pacific Islanders pay the highest prices for petrol, diesel and bottled natural gas than people living in most other parts of the world. The cost of oil has a direct impact on almost every human

WESAY economic activity, which in turn makes the Pacific Islands some of the most expensive places in the world for most goods and services.

The last decade has seen a number of measures taken in the Pacific Islands region to reduce dependence on fossil fuels. Western nations and development agencies have poured in millions of dollars to set up alternative, non fossil fuel based energy generation projects, particularly solar and wind based, in several islands nations around the region. One country, Tokelau, has almost been converted to run on renewable energy.

Other countries like Tonga and the Cook Islands have set themselves impressive targets to reduce dependency on fossil fuels and shift to renewable sources. These countries have drafted elaborate roadmaps to achieve their targets. These include both investment in renewables and achieving efficiencies in using fossil fuels. As to what extent they will be successful in achieving the targets they have laid for themselves is a subject for debate, but no matter which way one looks at it, the sheer force of economic growth will ensure the demand for fossil fuels will only rise at least in the short to medium term.

An Asian Development Bank report published last month titled Energy Outlook for Asia and the Pacific surveys the oil demand situation around the world and predicts scenarios for the next couple of decades. It pretty much concludes that despite the rapid strides that are being made in harnessing alternative cleaner fuels in the Pacific Islands region, its primary energy demand will more than double from 3.6 million tons of oil equivalent in 2010 to 8.8 tons of oil equivalent in 2035 at an annual rate of growth of 3.7 percent. Commensurate with its size and economic activity, Papua New Guinea will account for 75.8 percent of total primary energy demand in the Pacific in 2035, up from 62 percent in 2010.

But the report does state that these projected increases could be revised downwards if the region takes the right steps in achieving

Dependence on fossil fuels

the two pronged approach of achieving efficiencies in using fossil fuels while simultaneously increasing reliance on alternative, clean, renewable energy generation systems—namely solar, wind and tidal. Assuming that advanced technologies are applied by the final energy users and the transformation sector, and adequate investments are made in new and renewable energy generation, the oil demand is likely to be lower at 8.3 tons of oil equivalent instead of the projected 8.8.

The big question here is raising the capital for achieving this outcome, which in the long run will be cheaper, cleaner in being less polluting—and renewable. Where would the funding for such an initiative come from? Some islands nations are better positioned to increase their reliance on renewable sources than others.

Fiji is a case in point. It is blessed with natural geography that is suitable for hydropower generation—which it has successfully done (55 percent of its power comes from hydro renewables; the rest from imported fossil fuels). But the rate of Fiji’s economic and infrastructure growth over the next few years looks likely to outstrip its installed renewable energy capacity, with a real possibility of increasing reliance on fossil fuels, despite planned investment in enhancing hydropower capacity. This scenario is likely to play out in other Melanesian nations as well. The report identifies the Solomon Islands as having the most potential for harnessing hydropower because of its large land area and hilly terrain. The same is the case for PNG. Without adequate investment in renewable energy generation projects and strict discipline in achieving efficiencies of scale in the use of fossil fuels, the islands will see their fuel bills inevitably rise in the next two decades, spiralling the costs of essentials upward.

Tonga’s and the Cook Islands’ energy roadmap initiatives are steps in the right direction but without adequate investments and the political will and commitment, the roadmap is unlikely to take these countries to the fossil fuel-free destination that the two countries are hoping for.

‘The ACP sugar industry has no choice but to modernise and build human capacity forthwith. But it cannot do so without big investment. For which, it has had to again turn to—who else but the European Union. The ministers renewed their request for prolonging the support to the ACP sugar research sector beyond the current 13 million euros programme in 2013’

M

inisters from the African, Caribbean, Pacific (ACP) group of countries responsible for the growing of cane and manufacture of sugar gathered in Sigatoka, Fiji, last month for their 13th ministerial conference on sugar.

The ACP happens to be the largest trans-national governmental

organisation of developing countries with 79 member nations from the Caribbean, Africa and Oceania.

Though the three sub-regions of the grouping are separated by vast swathes of land and ocean, the member nations have several common traits—they are all developing nations in varying stages of progress, many of them have similar environments (those from the Islands Business, November 2013 9

WESAY Caribbean and the Pacific being mainly islands states, some of them The situation is made even messier by the fact that the European small islands states) and are bound by many common concerns, not Community’s free trade agreements and the Economic Partnership in the least their relationship with one of their largest funders—the Agreement (EPA) with many of the nations push these previously European Community. entered into preferential agreements in jeopardy.

In a separate development last month, an ACP eminent persons’ The ministers have asked for flexibility in the EPA negotiations group also opened up discussions with Pacific islands stakeholdalready under way to avoid the loss of market access to the European ers—as part of larger consultations with African and Caribbean Union for those countries who may not have completed negotiastakeholders—about the group’s relationship with the European tions in time for the necessary legislations to be put in place by the Community. The Cotonou Agreement largely defines the ACP’s September 30, 2014 deadline. funding arrangements with the European Community and its tenure The ministers’ main plank for justification for the extension of concludes in 2020. The consultations are to form a consensus on the concessions is that most ACP sugar producing nations are in what a successor agreement to Cotonou might look like. their developing stages and need more time, investment and capacity The European Community also gives preferential access to its building before they are ready to compete. vast marketplace for ACP’s sugar producing nations. ACP sugar This argument might have been valid and considered with more producers like Fiji in the Pacific compassion perhaps up to a have long enjoyed this preferdecade ago. ential access.

Harsh economic realities In fact, these countries have and a competitive market that almost developed a dependency has grown alongside can only on the European marketplace, prompt the bean counters at the with little being exported and European Union less sympasold to the free global sugar thetic to the ACP sugar producmarket. This preferential status ing nations’ touted plight. has blunted the ACP nations’ It is becoming increasingly sugar industry’s competitiveness clear that these nations have and almost put them out of the postponed investment, modreckoning in the global market. ernisation and capacity building This was a happy situation to in their sugar industry because be in as long as continued prefof the relative safety cocoon of erential access to a large, deep Carting sugar cane...to Lautoka Mill. Photo: fiji4me preferential access and guarand wealthy market was a given. anteed quotas that a safe and But the oceans of the world wealthy market offered over a economy hardly guarantee smooth sailing for long and the ill winds period of time. of the global financial crisis and the European Union’s own multiple It appears that they reckoned that such a scenario was permanent political and economic problems as well as a rather old and dated or could be negotiated to be permanent by banding together and arrangement arrived at a different time in history have all conspired playing the ‘developing stage’ and ‘poverty’ card. Such ploys cannot to turn the screws on the ACP sugar industry, particularly because last for long, as they are now finding out. of its over reliance on a single market. This state of affairs was It is not likely to be a sudden loss of compassion on the part of eminently apparent at the Fiji meeting. the European Community as much as hard economic reality. While the ACP’s sugar producing nations were churning out sugar for The European Union’s Common AgriEurope’s markets under all sorts of market protection initiatives, the ACP sugar cultural Policy (CAP) reform has resulted in global sugar market has grown to be a US$50 billion a year industry, industry needs the abolition of the sugar quotas in 2017. So, with more than 30 million hectares of land used for growing sugar. to modernise the guaranteed volumes that the ACP sugar Ironically, at a time when the world’s health outfits are urging producing nations were assured of will vanish, people to cut down on sugar and when the incidence of Type II come 2017. The ministers clamoured in unison to have this cap diabetes is at an all time high, the demand for sugar is also at an all extended by another three years to 2020 at the Fiji meeting. time high, because of the processed food industry.

The ministers lamented the European Union intransigence on It is indeed a telling commentary on how poorly the ACP sugar the issue despite the ACP’s previous representations being strongly nations have handled their affairs when they still need to so heavily supported by the European Parliament and the European sugar depend on European Union conferred concessions for the survival stakeholders. of their sugar industry, while there is such a huge hunger for the According to a communiqué issued at the end of the meeting, product in the world market out there, albeit demanding better the ministers also reiterated their fears based on the Commission’s quality and lower rates. report on the Prospects for Agricultural Markets in the EU 2012The ACP sugar industry has no choice but to modernise and 2020 that the end of the quota would lead to a reduction of the EU build human capacity forthwith. But it cannot do so without big domestic sugar price and make preferential access less attractive. investment. For which, it has had to again turn to – who else but The ministers re-emphasised the need for certainty and conthe European Union. The ministers renewed their request for a sistency in their trading relationship with the EU especially since prolonging the support to the ACP sugar research sector beyond with the latter’s support, the ACP countries have embarked upon the current 13 million euros programme in 2013. major reforms and restructuring program to ensure the long term sustainability, of their sugar industries.

• We Say is compiled and edited by Laisa Taga.

10 Islands Business, November 2013

Wherever life takes you, we’ll meet your changing needs with ANZ Signature Priority Banking.

anz.com/fiji +679 321 3575 | Suva

• +679 670 1708 | Nadi

Level 5, ANZ House • Level 1, Nadi Branch 25 Victoria Parade, Suva 378 Queens Road, Nadi

Australia and New Zealand Banking Group Limited (ANZ) ABN 11 005 357 522.

anz.com/papuanewguinea

anz.com/vanuatu

+675 322 3478

+678 26355

Level 2, ANZ Harbour City Granville, PNG

ANZ House, Lini Highway Port Vila, Vanuatu

Whispers Farewell Dr Rodgers: This month, we’ll get to hear about who is replacing Dr Jimmie Rodgers as the new boss of the Secretariat of the Pacific Community (SPC) as the Conference of the Pacific Community meets in Suva on November 18-19. Whispers has been told that three names will be submitted to the conference who will then decide Rodgers’ replacement. Apparently there have been some interesting names who were called up for interview in Noumea and they included PNG’s High Commissioner based in Fiji, Peter Efeare; the Pacific Islands Forum Secretariat deputy secretary-general, Feleti Teo; Fekita Utoikamanu—SPC’s deputy director-general; and former US Ambassador to Fiji Steve McGann. In fact, there were 11 people interviewed in Noumea for this job. That has been brought down to three best candidates which the conference will have to decide on. As Dr Rodgers gets ready to vacate his seat, one thing that will be pricking his conscience is how he handled the case of an employee who bashed his girlfriend. The employee Whispers understands is back in his home country with no charges being laid. In fact, Whispers hears SPC took the face saving way out and the woman basher resigned and left Fiji a couple of weeks ago. A facebook

We’ve Got it!

posting by a well-known Suva lawyer said: “When will the rest of us know whether SPC does take its responsibility under its own zero tolerance for violence policy seriously? We are all awaiting your decision Dr Rodgers. Are you going to follow the recommendation of your disciplinary panel or are you going to suck eggs?”  Travelling for a cause? Why is the head of a regional organisation under probe by donors for certain discrepancies in their accounts, still travelling? They say the answer is the bottom line.

Some disgruntled workers were heard muttering how their wages have been affected as a result of the delay caused by the probe. An accounting firm has been hired to look into the matter.  Facing O’Neill’s wrath: Well, there is definitely an angry PM in PNG. And he wants to get to the bottom of the issue—why it was necessary to send such a big PNG Power delegation headed

by State Enterprises Minister Ben Micah on an overseas trip? O’Neill said Micah had approved

the trip by the company board and management to Israel, Iceland and the rugby league World Cup in England. Micah, PNG Power chief executive John Tangit and board chairman Joshua Bakiri are likely to face O’Neill’s wrath when they return from England. The PNG Power entourage followed O’Neill to Israel recently despite not being part of the official delegation.

It then went on to Iceland to sign an agreement on geothermal power (at which Micah was present). O’Neill said: “We’ve got challenges here.

You can’t be travelling all around the world just because you like to travel. We need to focus on travel arrangements that are absolutely needed for the country, and not travel arrangements that are unnecessary. We can’t address big issues when we can’t attend to small ones on the ground.” Micah is not the only minister to face O’Neill’s wrath.

Sports Minister Justin Tkatchenko was also away overseas last month heading a big delegation comprising politicians, staff and family members to the World Cup. Who is paying the bills for these large delegations?  Donors waiting on Tuvalu: Donor agencies

And you need it...

What is it? Information - that’s what. It’s very simple really. To make the proper choices in your business you need information. The sort of in-depth, accurate, professionally-written information on the Pacific that you need to make an informed decision.

And that’s our business.

You see Islands Business is the premier monthly news, current affairs and business magazine of the Fiji Islands Business is for Fiji. It not only gives you the information you want - it gives you information you need and just as importantly, information you can rely on.

And you can only get it from us. So now that you have two things - that you need this information and that we’ve got it - make your first informed decision and subscribe to Islands Business.

Because you need to know exactly what’s going on.

To subscribe, complete the form below and return it to Islands Business International, 46 Gordon Street, PO Box 12718, Suva, Fiji Islands, South Pacific. Fax: (679) 3301423. E-mail: subs@ibi.com.fj Please print in block capitals Name .............................................................................................................................................. Title ................................................................................................................

Company .................................................................................................................................................................................................................................................................

Address ....................................................................................................................................................................................................................................................................

Country .....................................................................................................................................................................................................................................................................

Method of Payment:  Cheque

 Bank Draft

 American Express Account Number

(Make payable to Islands Business International. Only local cheques drawn on Australia, New Zealand or US banks will be accepted.)

VISA

Diners Club

Master Card

Expiry Date ____________________________

I authorise the above charges to be made to my credit card. This purchase is made with the credit card noted above and in accordance with the terms of my Credit Card Agreement.

Signature _________________________________________________________________

Subscription Rates: Fiji: FJD50.00 . South Pacific Islands Air AUD55.00 Australia Air AUD45.00 New Zealand Air NZD65.00 Hawaii, North America & Micronesia Air USD52.00 United Kingdom, Europe & Other Air USD62.00 Please select appropriate area and postage and handling desired. *The equivalent in Pounds Sterling, Hong Kong Dollars, Japanese Yen & French Francs will also be accepted.

Islands Business, November 2013

Whispers who listened to Tuvalu’s roadmap vision for the future are awaiting a summarised version of the extensive roadmap presented to them in September this year. It is understood that a summary should be available once Prime Minister Sopoaga returns from a number of meetings overseas, with his foreign officials who are also currently on assignments overseas. The government is also expected to be finalising its budget to present to parliament in December.  Passport scam? Tonga’s immigration situation is coming under the spotlight after Opposition MPs have questioned how some Asian travellers have managed to secure Tongan passports without following proper naturalisation process. A number of Chinese who applied and were granted passports under these circumstances have disappeared, according to sources in Tonga.

Two Chinese immigrants were detained recently by the immigration authorities for holding fake Tongan passports. Meanwhile, one Chinese immigrant has fled to Fiji after being involved in an alleged kidnapping incident.  The rippling effects: A certain statutory body in the region has been hailed in the local media for writing off loans for tenants who have struggled to meet payments for a number of reasons. Lately, the organisation wrote off nine homes loan at a cost of $217,000. Since 2011, they have also managed to write off 263 loans totalling $2.5 million.

However, officials have found out that they are receiving more default reports apparently from tenants who wish to qualify for similar treatment.  Beauty pageant venue: As the regional beauties of the Pacific flock to Honiara this December for the crowning of the Miss South Pacific 2013 event, the national event in the host country has been raising eyebrows. Kudos to the bevy of beauties for fundraising efforts, but public opinion was definitely divided on the choice of venue for the final crowning night event for Miss Solomon Islands—the Cowboy Bar and Grill. Far from being a family-friendly locale, the Cowboy Bar both enjoys and suffers from its raunchy red-light rep. Wonder what the pageant organisers in Samoa would think of how far the ideal of beauty has come.  Still on the beauty pageant: Expect the following and more: Mini trade show and a fashion show that will include some international designers.

There will also be a formal dinner during the pageant week to raise funds that will go towards

Advertising & Marketing Manager Sharron Stretton Advertising Executive Abigail Covert-Sokia

key projects dealing with women’s issues. And this year, chairman of the pageant committee Tony Koraua says, there’s a possibility Miss Vanuatu will be entering the Miss South Pacific Pageant for the first time. Not all the events will require a fee; the public can participate in free events as well, Koraua says.

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



Litiana Tokona ltokona@ibi.com.fj subs@ibi.com.fj

Honiara’s betelnut vendors: Nervous betelnut vendors in Honiara are eyeing the positive impacts of the buai bans in neighbouring Papua New Guinea, and wondering if restrictions on sale there will trickle across the waves. Buildings, roads and public spaces across the Solomons’ capital city already suffer from the tell-tale blobs of red residue from the betelnut-chewing populace. Health officials in Honiara have long decried the risks of spitting and splatter in the capital for spreading disease, with little effect.

But news on the ‘clean-city’ look following the bans on public sale and consumption of buai in Port Moresby may have to jump in a long queue of urban growth issues for Honiara City councillors, already dealing with traffic congestion, rubbish, water, roading and illegal settler issues on their to-do list.  Value less money: Interesting reading from the Drum column of the Post Courier newspaper of Papua New Guinea. It wrote about a Papua New Guinean who buried a total of K1,800 three years ago to save it because he did not want to go to the banks. This year, he was shocked to find out when he dug out the money that it was all valueless because the central bank has taken the paper currency out of circulation. Not knowing what to do, he plans to fly to Port Moresby to get an answer from the central bank on what to do.  Follow the dollar sign: Fishing stakeholders travel to Cairns next month for the WCPFC (Tuna Commission) meeting. Most of the time decisions are marginal and conservative which benefit distant water fishing nations (DWFNs) more than the stockholders of the fish.

But most of the time custodians of the stocks are ministers and individuals who tend to be diverted into side meetings where they are targeted individually by the DWFNs. It is important that each Pacific Islands media outlet knows what goes on behind the doors of the side meetings where the real decisions are made. Most of the time those decisions are not really in the interest of the nation. Whispers says—follow the dollar sign!

• Whispers is compiled and edited by Laisa Taga.

If you have any Whispers, please contact us on editor@ibi.com.fj

Circulation & Distribution

Sandiya Dass sdass@ibi.com.fj Regional magazine sales agents Pacific Cosmos – 89 Brisbane Street, Oxley Park, NSW, Australia Pacific Supplies – Rarotonga, Cook Islands Yap Cooperative Association – Colonia, YAP, Federated States of Micronesia Motibhai & Co. Ltd – Nadi Airport, Fiji Paper Power Bookshop – Town Council Bldg, Main Street, Nadi, Fiji Suva Bookshop – Greig Street, Suva, Fiji Chapter One Bookshop – Downtown Boulevard, Suva, Fiji Kays Kona Shop – Dolphin Plaza, Suva, Fiji USP Bookcentre – USP, Laucala Campus, Suva, Fiji Garden City Bookshop – Garden City, Raiwai, Suva, Fiji Bulaccino – Garden City, Raiwai, Suva, Fiji Samabula Drugstore – Samabula, Suva, Fiji Kundan Singh Supermarket – Tamavua, Suva, Fiji MH Superfresh – Tamavua, Suva, Fiji Methodist Bookstore – Stewart Street, Suva, Fiji Textbook Wholesalers – Bsp Centre Suva, Fiji MHCC – Suva, Fiji Hachette Pacifique – Papeete, French Polynesia Kiribati Newstar – Bairiki, Kiribati One Stop Stores – Bairiki, Kiribati Robert Reimers Enterprises – Majuro, Marshall Islands Pacific & Occidental – Yaren, Nauru South Seas Traders – Alofi, Niue Nouvelle Messageries Caledoniennes de Presse – Noumea, New Caledonia Wewak Christian Bookshop – Wewak, PNG Boroko Foodworld – Boroko, PNG UPNG Bookshop – Waigani, PNG Lucky Foodtown – Apia, Samoa Wesley Bookshop – Apia, Samoa Panatina Chemist Ltd – Honiara, Solomon Islands Officeworks Ltd – Honiara, Solomon Islands National Stationery Supplies – Honiara, Solomon Islands Friendly Islands Bookshop – Nuku’alofa, Tonga Tuvalu Air Travel, Shipping – Funafuti, Tuvalu Trade and Consultancies – Funafuti, Tuvalu Stop Press – Port Vila, 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, November 2013 13

Pacific Update

By Christopher Pala

P

resident Anote Tong of Kiribati has reversed a previous position against funding and the banning of fishing in the Phoenix Islands Protected Area (PIPA), paving the way for the creation of the world’s most important marine reserve.

In a September 25 press release issued jointly with the giant American NGO Conservation International (CI), on whose board Tong sits, he announced he had finally made good on a five-yearold pledge to place US$2.5 million in government funds in PIPA’s otherwise-empty trust fund, something he had insisted to Islands Business just last May he had no intention of doing.

And for the first time, Tong publicly endorsed the position of some fisheries scientists who say that closing the California-sized reserve to all fishing, far from entailing sacrifice as Tong had previously contended, would make good business sense for his people.

The scientists, whose views were first published in the July issue of Islands Business, said foreign fleets of industrial purse seiners are fishing tuna around the oceans faster than the tuna can reproduce, causing the stocks and their yield to shrink.

Thus, creating a no-take zone as large as PIPA in the world’s most intensively fished area would allow tuna and other species to reproduce unhindered there and to double in number back to their original density, probably within a decade.

At current prices, this extra tuna would be worth over US$200 million, but fisheries economists expect prices to continue rising as global demand for canned tuna steadily increases.

“It’s money in the bank,” said Ashley McCrea-

Tong changes mind on PIPA Strub, a fisheries scientist who studies marine prosince the last inhabitants—the U.S. military persontected areas at the University of British Columbia nel based in the main island of Kanton—left in in Vancouver, Canada.

1979 after Kiribati gained independence.

She had pointed out to Islands Business that In the press release, Tong said PIPA was not when the i-Kiribati start feeling the effects of seain fact “off-limits to fishing and other extractive level rise in the coming decades, the extra cash uses,” but added that ending fishing there was now would come in handy. the “ultimate goal for Echoing these views PIPA.” for the first time, Tong In a second major said in the September development, Tong press release that PIPA announced that the was “an investment” for US$2.5 million pledged the future of Kiribati. in 2008 by his country “With PIPA…we are for the PIPA Trust Fund investing in preserving had been disbursed, food security for the allowing CI to make world and creating an good on its own pledge insurance policy for fishto donate a matching ing in the region.” amount.

Until now, Tong in The US$5 million, public routinely de- More than 50,000 tons of skipjack tuna like these…being said Sue Taei of CI in scribed PIPA as having unloaded in Majuro were taken out of the Phoenix Islands an interview with an been “off-limits to fish- Protected Area last year. Photo: Christopher Pala Australian radio station, ing and other extractive was placed in an ANZ uses” since its creation Trust account. The inin 2008. In fact, as the PIPA management plan terest would pay for “core staffing and expertise on available on PIPA’s website makes clear, its creation Kanton Island and provides for a range of increased has had virtually no effect so far. surveillance and monitoring, and other activities”, Fishing was only banned in three percent of the as well as to operate the PIPA Conservation Trust reserve, the areas around each of the eight Phoeoffice, she said. nix Islands, where little or no fishing had occurred A handful of civil servants and their families

West Papuan activists lobbying Pacific leaders

By Robert Matau

W

hile they are keenly awaiting the decision on their membership of the Melanesian Spearhead Group (MSG), West Papua activists are travelling the Pacific lobbying countries to support their bid.

One such activist is exiled investigative journalist Octovanius Mote, who has just returned to his adopted home in Washington D.C in the United States last month, after island hopping the Melanesian states. He is an activist and lobbyist in the world’s greatest democracy.

However, like the torrid history of his country under Indonesia and the failures they have suffered at the hands of the United States, United Nations and their closest neighbours Papua New Guinea in securing autonomy, Mote is taking one stride at a time.

Mote said after 40 years of Indonesian rule, joining a group like MSG would enhance their endeavours for independence.

In 1961, he said 1025 of his kinsmen were selected by the Indonesians when the United Nations gave West Papuans a chance to determine its own destiny in what is known as the ‘Act of Free Choice’. However, Mote said their leaders were shown footage of how they (Indonesia) tortured the people.

“The obvious result of that was they voted for Indonesian rule and we became a province of In-

14 Islands Business, November 2013

donesia,” he told Islands Business.

“Under these circumstances, we inherited this government and these issues are well documented and not made up.

Since then, he and freedom members of the Free Papua Movement have been calling on the international community to give them recognition.

Mote is also recognised for his part in trying to address self-determination. As a former bureau chief of Kompas newspaper in West Papua, he served as a rapporteur for a national dialogue on the issue in 1999 between then Indonesian President Habibie, who had claimed the reformists tag, and West Papuan community leaders.

However, his (Habibie’s) participation came on the condition that the issue of independence was not to be discussed.

However, the West Papuan leaders presented their petition and Mote and four other organisers of the meeting found themselves blacklisted on charges (allegedly trumped up) of buying arms.

Habibie postponed a decision on the autonomy petition.

Fortunately, Mote was already on his way out of Indonesia for the United States as part of a United States Information Agency Visitors programme. It was the last he was to see of his homeland.

In exile, Mote continues to cry for the support of his eastern cousins and has seen a change in heart in various Melanesian governments.

“I met with support groups in Fiji to basically

get updated on what is the progress on our application,” he said.

He says he is encouraged by the support shown.

“So for that we really would like to thank all the Melanesian leaders for being united on this after 50 years of Indonesian rule.”

Mote was also enthusiastic about the response from West Papua’s closest neighbour Papua New Guinea who in the past tended to side with Indonesia.

Former Prime Minister, Sir Michael Somare, a founding member of the MSG, said West Papua should engage with Melanesian society because culturally they (West Papuans) are Melanesians.

“We don’t see any MSG leader opposing our right for self determination and our opposition to crimes against humanity in West Papua,” Mote said.

He said they were also keen to see MSG leaders visiting West Papua after they visit Indonesia—an invitation extended to MSG Foreign Affairs leaders

by Jakarta and accepted this year during the MSG summit in Noumea in June.

However, he echoed fears of his kinsmen that once the MSG foreign ministers arrive in Jakarta, Indonesia could stop them from entering West Papua based on security risks.

“If the visit does happen, it will be an historic one because many years ago people were not allowed to visit us particularly journalists, human rights workers and advocates and our people definitely will not harm their wantoks,” Mote said.

serve on a rotating basis on Kanton, which has an old runway.

In an interview in May, Tong had said he had no intention of putting in the long-pledged US$2.5 million, saying he wanted to “source it” (meaning ask foreign donors) even after it was pointed out that Kiribati had doubled its income from fishing licences to $60 million last year by exceeding its international quota and that it could afford to do so more than at any other time. In the end, the money was taken from another national trust fund.

Praise for Tong’s new approach was swift, but conditional. Seni Nabou of Greenpeace, which unlike CI has long called for Tong to close PIPA to all fishing immediately, said the funding of the PIPA Trust Fund was “encouraging.” But she added that extending the no-take zone was urgent.

“This so-called ‘protected’ area is gradually being emptied of life,” she wrote in an e-mail, “and Beretitenti Anote Tong is the one person who can stop the plunder so that PIPA truly becomes the insurance policy he envisions and ensures fair returns from fishing outside of the PIPA area for his people.”

“There is so much at stake and we can’t procrastinate,” added Dr. Teuea Toatu, executive director of the PIPA Conservation Trust. “Every day we defer action is a day too many.”

Three other no-take marine reserves are about PIPA’s size, but virtually no fishing went on in two of them (the Northwestern Hawaiian Islands and the Coral Sea) before they were created. In the third, Britain’s Chagos Islands in the Indian Ocean, the fishery that was closed in 2010, was less than half in a good year than the estimated 50,000 tons of fish taken out of PIPA last year.

“For journalists who get accreditation to work in West Papua, they would have to apply for special permission and when they do get there, they are assisted by Indonesian security personnel.”

Mote said he visited Papua New Guinea in August and met with cabinet members asking them about their position over West Papua’s self determination.

“They told me they don’t oppose our right but since being directly on the border with Indonesia they have to look for a way where they can maintain good relations with Indonesia.

“So I don’t see them having a formula on how to address our situation.

“But I definitely have seen a different attitude from them concerning our struggles.”

From PNG, Mote went on to Port Vila where the indigenous West Papuans have the greatest ally. Mote said it was former Vanuatu Prime Minister Father Walter Lini who said if there remained a Melanesian country still colonised, then Vanuatu is not free.

The current Prime Minister Moana Carcasses Kalosil has not changed that stance and Vanuatu is regarded the most active government in the fight for West Papuan struggle. But Mote is concerned about how the Indonesian Government has started to woo Melanesian leaders individually, particularly Solomon Islands’ Prime Minister Gordon Darcy Lilo who visited Indonesia in September

Why the Pacific should say No to refugees

By Marilyn Shepherd

sonableness and proportionality of those limitations have not been clearly demonstrated.

By contrast, the unlawful removal of refugees apua New Guinea and Nauru are being bulfrom Australian soil by the Australian government lied to assist Australia to traffic humans by with only the consent and written agreement of force out of Australia on the pretext of stopping the Papua New Guinea and Nauru governments is people smuggling—a con invented by former Mindefined as human trafficking under international ister for Immigration Philip Ruddock in 1999 and and Australian law and punishable by 14 years in agreed to by former Shadow Minister Con Sciacprison by the perpetrators. cia and which has continued to this day.

“Trafficking in persons” shall mean the recruitBefore 1999, there was no offence under Ausment, transportation, transfer, harbouring or retralian law called “people smuggling”. In 1992, ceipt of persons, by means of the threat or use of the refugee convention had been enshrined into force or other forms of coercion, of abduction, of the Australian Migration Act granting anyone the fraud, of deception, of the abuse of power or of a right to enter or stay in Australia without visas and position of vulnerability or of the giving or receivclaiming asylum. At the same time, the parliament ing of payments or benefits to achieve the consent invented refugee detention to avoid having to asof a person having control over another person, sess the claims of a few hundred Cambodians. for the purpose of exploitation.”

In 1999, when just 920 Afghan and Iraqi refuI am not acgees arrived by cusing Papua sea after fleeing New Guinea genocide and or Nauru of torture by the exploiting the Taliban and the refugees trafSaddam Husseficked to their in regime, Rudnations. But dock and the both governAustralian parments cerliament passed tainly appear laws to jail to gain a good anyone who asdeal of money, sisted refugees, e mp l oy m e n t even though and benefits this was not then and is not Nauru’s regional processing centre...under construction as of October 8, in exchange for now a crime.

2013. This is the camp that was burnt down by the asylum seekers during human beings.

What both By 2000, the the July 2013 riot. Photo: Nauru Government Information Office. nations need UN had beto be aware of is the cost to their nations of claims come alarmed at Australia over not only the prisfor compensation for arbitrary and illegal imprisons for refugees but the punishment of those who onment, poor living conditions, and enabling the assisted them. punishment of innocent men, women and chilWith consultations, the UN wrote two protodren with agreements not ratified by any law. cols which offer greater protection for refugees Three other countries have tried such agreeand asylum seekers, migrants and trafficked sex ments—Britain, Italy and Kenya. In Britain’s case, slaves. These were ratified by Australia. the court ruled that sending refugees by force to In both protocols, there were saving clauses Greece or any EU state with lesser living standards which exclude punishing migrants or other vicwas illegal; in Italy’s case, they ruled it was illegal tims simply because they are punished or trafto set up prisons in Libya due to human rights vioficked and excluded the movement across borders lations by Italy; and in Kenya, it was ruled that the of anyone seeking asylum. government could not even send refugees from Under the Law of the Sea, everyone has the urban areas in Kenya to refugee camps. right to innocent passage in the open sea, even When refugees trafficked to Manus Island and the right to land on any coast and make claims Nauru seek to claim compensation against the for asylum without being punished for doing so. governments of those countries, the refugees will Article 32 of the refugee convention forbids exwin as they have in Australia. Prime Minister Peter pulsion from the territory of any signatory nation O’Neill of Papua New Guinea should desist in his except for genuine national interest concerns, condealings with Australia now and force Australia to cerns which have never existed in Australia and live up to her international obligations and Auswhich the Human Rights Parliamentary Committralian law or face the same problems Australia tee concluded in a major report breached Austrahas. lian and international human rights laws.

Australia is conning its neighbours into breakThey stated clearly in relation to dismissing ing the law under the guise of stopping the the right to seek asylum to be unreasonable and smuggling of refugees to Australia but it is not disproportionate— smuggling because they still have to arrive in • To the extent that some of those rights may Australia. be limited, the committee considers that the rea-

P

Islands Business, November 2013 15

Cover Report

Crisis coming...in 2012, a record haul of 2.65 million tons of tuna was netted in the Pacific, prompting islands fisheries management officials to call for immediate reductions in catch. Photos: Giff Johnson.

TUNA SHO Pacific tuna stock faces growing

A

By Giff Johnson

showdown that could decide the sustainability of the US$7 billion Pacific tuna industry is expected at the annual meeting of the Western and Central Pacific Fisheries Commission (WCPFC) in Cairns, Australia, on December 2-6.

The Pacific countries and distant water fishing nations that are members of WCPFC will meet to decide on conservation measures at a time when tuna resources have never before been under so much pressure.

In 2012, a record 2.65 million tons of tuna were caught in the region by the most boats fishing ever. Coupled with the 2012 tuna totals—at a time when scientific advice has called for a 30 percent reduction in effort—is the refusal by some distant water fishing nations to provide operational catch data and efforts by others to undermine established management regimes adopted by the Pacific Islands, notably the eight members of the Parties to the Nauru Agreement (PNA).

One bright light is a joint proposal for increased conservation efforts—including such initiatives as increasing the period of mora16 Islands Business, November 2013

torium on the use of fish aggregation devices (FADs)—that will be jointly introduced for action at the WCPFC meeting in Cairns by PNA, Japan and the Philippines.

This conservation plan breaks new ground not only by proposing a long-term conservation management scheme for WCPFC to adopt but because it is endorsed by 11 member nations of the WCPFC, not just the PNA as in the past.

They are jointly proposing conservation measures focusing on bigeye, yellowfin and skipjack tuna.

Among the recommendations that will go to the annual meeting of the WCPFC is to reduce the catch of bigeye by long-liners by 45 percent of the 2004 levels by 2017, and for skipjack to expand an annual ban on the use of fish aggregation devices (FADs) by purse seiners from the current three months to four months starting in 2014 and to five months beginning 2017.

In addition to conservation measures in the 200-mile exclusive economic zones of PNA nations, it seeks to cap the number of fishing days allowed annually on the high seas.

But Glenn Hurry, executive director of the WCPFC based in Pohnpei, is not overly optimistic about the PNA, Japan and Philippines measure.

US$7 billion business...a purse seiner offloads its catch of tuna to a mothership in Majuro.

WDOWN crisis of inaction Hurry, an Australian, issued a blunt warning to the Pacific Islands Forum Leaders meeting in Majuro in September— a warning that surprisingly did not even rate a mention in the Forum communiqué.

While the record catch in 2012 might appear to be good news, in fact this catch was taken “by an increased number of vessels fishing harder than they have ever fished before, fishing more efficiently with better technology and deploying more sets than in previous years”, Hurry said.

Despite scientific evidence that bigeye tuna is being overfished, Hurry said the WCPFC has been unable to get agreement from its membership to reduce bigeye catches. Of the PNA, Japan and Philippines proposal, Hurry said plainly: “There is still considerable disagreement between the WCPFC members on what actions might constitute the final text in this conservation and management measure.”

He said the number of vessels fishing for tuna continues to increase in the Pacific, with last year’s 297 fishing boats setting an all-time high. But 45 more purse seiners are now under construction in Asian shipyards, which will “cause sustainability problems in the fishery,” he said and raised “serious concerns about the increasing

number of vessels fishing in the region.

“What we now see from the 2012 fishing data is more boats in the fishery, higher overall catches, smaller fish sizes and the lowest ever levels of fisheries biomass for these tuna stocks.”

Marshall Islands fisheries Director Glen Joseph said as bad as it sounds, the situation is worse. “It’s not just bigeye tuna raising concern,” he said. “Swordfish catches are raising a red flag.”

And yellowfin tuna is reported by scientists to be near its maximum sustainable yield. “If distant water fishing nations support sustainability of the resource, then they need to commit to a 30 percent reduction in catches,” Joseph said. “It’s not a question of should they do it or not. They have to do it or face the consequences.”

The European Union challenge Among the myriad of challenges facing the islands as they attempt to exert control over the Pacific tuna industry, recent European Union actions stand out. Ironically for the EU, as its parliament was passing a “Comprehensive Fisheries Strategy for the Pacific” in mid-October with the stated goals of improved management, the Spanish vessel Albacora Uno was being fined US$1 million by a Nauru court for unlicenced fishing in Nauru waters.

Islands Business, November 2013 17

Cover Report As a sign of good faith and willingness to adhere to the region’s fishing rules, the EU member vessel made a clear statement in Nauru as have EU fisheries and free trade negotiators in recent months.

The EU’s new fisheries strategy has been derided by islands leaders, not the least for the fact that the EU produced its fisheries strategy for the Pacific without talking to anyone in the Pacific.

The Pacific Islands Forum Secretariat lambasted the document and the process through which it was produced. “We are extremely disappointed that the Pacific ACP (Africa, Caribbean, Pacific) region was not consulted nor did it have the opportunity to provide input into such an important initiative for both the EU and the PACP region,” said Forum Deputy Secretary-General Andie Fong Toy in a letter distributed to European Parliament members in late September.

“We are extremely concerned with the misinformation in the draft report. A strategy based on wrong information, coupled with the departure from agreed consultation practices will not be the basis for a sustainable partnership.”

Despite a detailed four-page letter from Fong Toy, accompanied by numerous documents to support its criticism of the EU fisheries strategy, the European Parliament adopted the strategy overwhelmingly in mid-October.

of fisheries resources in the region. The same measures have been recognised by the U.S., Japan and all other distant water fishing nations. We expect the EU to respect our national and sub-regional conservation and management measures including the VDS.” Not all islands nations are bending in fisheries negotiations with the EU. The Solomon Islands recently refused to renew a fisheries partnership agreement with the EU. In a September 27 letter to the Forum Secretariat, Solomon Islands Permanent Secretary for Fisheries and Marine Resources, Dr Christian Ramofafia, explained why the Solomons took this action. The decision was based on the Solomon Islands solidarity with the PNA arrangements agreed by the eight members.

Catch cuts...Marshall Islands fisheries director Glen Joseph (right) says the tuna industry must reduce fishing effort by 30 percent or risk wrecking the fishery.

Undermining VDS The EU has worked at undermining the vessel day scheme (VDS) that now controls purse seine fishing in the region, limits fishing days that can be sold, and has led to a quadrupling of revenue accruing to PNA members in three years.

To convince the European Parliament, the strategy draft used faulty data to claim that VDS is not controlling fishing effort, said Fong Toy in a statement that was backed up by WCPFC director Hurry and Secretariat of the Pacific Community’s principal fisheries scientist Peter Williams.

“The draft strategy states that the framework agreement should be based on VDS provided that the measures are transparent and are implemented by all parties concerned and based on the best available scientific advice,” Fong Toy said.

“This would be a very positive change from the current practice during negotiations on bilateral Fisheries Partnership Agreements (FPAs), where the EU has insisted that the PACP states disregard the VDS to the detriment of the region. FPAs, by nature, do not limit effort or catch.”

Earlier this year, the EU negotiated an agreement with Kiribati that makes no mention of VDS, and has opposed inclusion of VDS language in the fisheries section of the Economic Partnership Agreement under negotiation with the region.

“PACP states maintain that their conservation and management measures, including the VDS, are credible and comply with relevant international laws and obligations,” Fong Toy said.

“These measures are also recognised and adopted by the Western and Central Pacific Fisheries Commission, which the EU is a member of, and have been effective tools in the sustainable management 18 Islands Business, November 2013

“The EU refused to accept the application of the VDS to EU vessels,” said Ramofafia. “Secondly, as a signatory to the PNA Third implementing Agreement, Solomon Islands advised it could only licence EU vessels on the condition that they not fish in designated high seas areas.”

Several years ago, PNA imposed a ban on fishing in two high seas “pockets” that were surrounded by the 200-mile exclusive economic zones of PNA members as a conservation measure to reduce fishing.

The ban on high seas pockets became a licencing condition: if distant water fishing nations want to fish in PNA waters—which they do, because 50 percent of the world’s skipjack tuna is caught in PNA waters—they had to agree not to fish in these pockets.

“I do not consider this action to be against the UN Convention on the Law of the Sea and WCPFC provisions as Solomon Islands is not unilaterally closing the high seas, but rather it is refusing, as is its right, to licence vessels to fish in its EEZ if they fish in these designated high seas areas,” Ramofafia said.

“This approach was successfully used by Forum Fisheries Agency members to ban high seas trans-shipment in 1993, a move that was not legally challenged by distant water fishing nations.”

The EU appears to be repeating an unhappy history in its fisheries policies. It took FFA members years to get United States vessels under the VDS, but as of June this year, all American-flagged purse seiners now recognize VDS. How many years will it take to bring the EU into the VDS? Marshalls’ fisheries director Joseph believes some distant water fishing nations focus on in-zone management by islands nations as a way to derail urgently needed implementation of fishing rules on

Cover Report the high seas—the area that is the under jurisdiction of the WCPFC. As this year’s annual WCPFC meeting approaches, Joseph said “There has been a major effort at conservation and management PNA and coastal states “have to be optimistic (about the Commisin-zone,” said Joseph. “But less so on the high seas.” sion taking action) because we have something on the table. We This is a huge issue for the WCPFC, whose members must begin have to capitalize on it. demonstrating greater action in the high seas or the integrity of the “If our measure is rejected, it will be a rejection by distant water commission will be called into question. fishing nations of coastal states’ interests and a breach of the WCPFC Joseph points to key issues for the islands at the WCPFC. ReTreaty’s Article 30 (which requires the WCPFC to ‘give full recognicently, aerial surveillance discovered 19 Taiwan purse seiners in a sotion to the special requirements of developing states parties to this called “buffer zone” within 100 miles of his country’s 200-mile EEZ. convention, in particular small island developing states’).”

According to WCPFC rules, and Taiwan is a member, vessels in these buffer zones are required to have their vessel monitoring Legacy system equipment transmitting position data to the WCPFC in WCPFC’s Hurry said the fisheries management organization has Pohnpei. But the 19 vessels were in violation of this rule and are done “some great things” since its formation, including “functionnow subject of a complaint lodged by the Marshall Islands with ing with the best set of management and monitoring tools of any the WCPFC. Regional Fisheries Management Organization,” stronger domestic Since the WCPFC fisheries agencies, and was established seven better scientific knowlyears ago, a requireedge of stocks. ment agreed to by “The commission’s members was for dislegacy and our collectant water fishing native legacy to the Pacific tions to provide operawill not be in allowing tional catch and effort highly unsustainable, level data for fishing on short-term economic the high seas. returns from this fish“But after seven ery. It will be in our abilyears,” said Joseph, ity to ensure through “major players are not effective management being forthcoming the long-term conservawith this data. It’s a big tion and sustainable use gap. If the Tuna Comof tuna stocks. mission and the Pohn“The islands can pei secretariat cannot generate greater wealth exert authority over than they have to-date the fleet on its high from the fishery, but seas activities, then it is the potential to achieve just rhetoric. They are this is being seriously agreeing but not abideroded by the contining by it (the rules).” ued increase in vessels Joseph makes the entering this fishery,” point that the lack of Hurry said. data from vessels on The commission’s high seas catches causes annual meeting in early great uncertainty in sciDecember must take entific estimates of the forthright action to rehealth of tuna stocks. duce catch and effort Meanwhile, in-zone levels, Hurry said. measures, such as those All commission put forward by PNA, members, including often get the most dethe Forum islands, must haul...the revenue for the 8-member PNA has skyrocketed in recent years with revenue quadrupling bate at WCPFC meet- Skipjack demonstrate this year from 2010 to 2013. ings because the islands that they are capable of are actively working to taking hard decisions conserve the resource. for the management of the region’s tuna stocks, Hurry said.

“But the WCPFC should be focused on the high seas and it starts “These decisions will mean reduced levels of catch for bigeye from the provision of catch and effort data,” Joseph said. “Coastal tuna, it will mean agreeing to management arrangements for the states are trying to comply (with WCPFC rules) with help from catch of yellowfin and skipjack tuna, and it will mean capping and FFA and SPC. reducing the number of vessels in the fishery.

“We’re developing monitoring, control and surveillance measures “If we as coastal nations want to sustain the resource for the next to enforce rules, we are participating in the regional observer pro50 years, we must insist on a 30 percent reduction in effort and gram, and we are providing catch and effort data.” mortality by key tuna species of concern,” Joseph said.

But, said Joseph, the islands’ management measures “become These are decisions that can no longer be delayed, say Hurry and the subject of scrutiny and debate at commission meetings and the Joseph, but which are expected to make for a contentious WCPFC high seas gets left off the agenda.” annual meeting.

Islands Business, November 2013 19

Trade

EPA’s off

PNG dumps regional solidarity to save its tuna exports to Europe

By Samisoni Pareti More than a decade of negotiations for a free trade agreement between the Pacific members of the African, Caribbean and Pacific (PACP) states and the European Union (EU) came to naught in Brussels last month.

Officially, the European Commission (EC)— the secretariat of the EU—told the Pacific government officials the Economic Partnership Agreement (EPA) negotiations have been suspended “sine die”.

The EC blamed the suspension on Papua New Guinea.

Brussels said Port Moresby has opted out of the Pacific ACP shared position that EPA negotiations with the EU would be negotiated regionally.

Instead, PNG wanted to do it alone, preferring to stick with the interim EPA (IEPA) it had signed in 2009 and ratified in 2011.

In this way, PNG says it is protecting its multi-

million dollar tuna exports to Europe.

This is not the first time the Pacific’s biggest member has let its smaller neighbours down.

It first happened in 2009 when all Pacific members of the ACP had agreed for a common regional position on the EPA and that they should reject IEPA negotiations but go for a comprehensive one.

PNG instead went behind the back of its Pacific islands neighbours and secretly negotiated an IEPA which gave duty-free and quota-free of its tuna to the European market.

Red-faced Pacific officials Then, the Pacific’s second largest economy Fiji followed suit, agreeing to break off from the regional solidarity and joined PNG in signing an IEPA with Brussels.

The Fijian Government, however, made a turnaround soon after and despite insistence by the EC, refused to ratify its IEPA.

What’s next? Pacific islands leaders will now have to decide the

Last month in Brussels, Fiji did not follow its Melanesian neighbour, preferring instead to stick with the regional position.

Pacific government officials who were in Brussels in October for meetings with EC officials said the PNG turnaround left many islands officials red-faced.

Port Moresby, they said, did not offer even their Pacific islands colleagues the courtesy of informing them of their changed position.

It was the EC officials who had to break the news.

Confronted later, PNG officials said they had to stick with their IEPA with the EU, or they will lose the much sought-after global sourcing provisions in the interim agreement.

Many observers of regional trade negotiations

Westpac has a long history of financial expertise in the Solomon Islands. Backed by industry experts in commodity, energy, telecommunications and public sector financing, your business is in professional hands.

Call (677) 21222 Email gmsolomons@westpac.com.au Visit Mendana Avenue, Honiara or www.westpac.com.sb

Islands Business, November 2013

WPBW680 (05/13) 344124

When you require Institutional, Corporate and Business Banking, talk to the bank that knows your business.

Trade won’t be surprised by the PNG move.

It has been long understood that PNG was the weak link, because when push comes to shove, when national interests clash with regional interests, PNG will opt for the former.

Brussels had also not made a secret of its insistence that Pacific members of the ACP bloc should opt for an IEPA, not a comprehensive one. next course of action. Photo: Nic Maclellan So with the EPA negotiations now suspended, where to from now?

“Our Pacific Ministers have met (in Brussels) and decided to regroup in the region (Fisheries/Trade) and see where to go from here,” a senior Pacific official told islands Business.

Exactly where the ministers would want to go, no one seems to know.

Another official suggested that with the EPA talks suspended, Pacific officials should direct more energy and focus on negotiations with Australia and New Zealand for a PACER Plus.

Brussels’ decision to call off EPA negotiations came as the European Parliament adopted its strategy on Pacific fishery on October 8.

The strategy confirmed what this magazine had reported in its August 2013 edition.

This motion insists that access to fishing waters of Pacific states must be part of any EPA negotiations; that it be negotiated regionally and access be offered to EU fishing boats bilaterally by Pacific ACP states.

In adopting their new strategy, the EU Parliament rejected the insistence of Pacific islands states that the proposed EPA is about trade and development, and not a fishery treaty negotiation.

TRADE MARK CAUTIONARY NOTICE IN NAURU Notice is hereby given that CBS Broadcasting Inc., a New York corporation of 51 West 52nd Street, New York, New York, 10019, United States of America, is the sole proprietor in Marshall Islands and elsewhere of the following trade mark:

Used in respect of:Broadcasting services; cable and satellite transmission services; providing video images and information for wireless mobile communication devices; providing wireless transmission of uploading and downloading video images, information and news via a global computer network to a wireless mobile communication device; Internet services which should be understood to include communication services, namely transmitting streamed sound and audio-visual recordings via the Internet; providing access to information in the field of entertainment. Audio and video broadcasting services over the Internet or other communications network, namely, uploading, posting, showing, displaying, tagging and electronically transmitting information, audio, and video clips; providing access to information, audio, and video via websites, online forums, chat rooms, list servers and blogs over the Internet; providing on-line chat rooms and electronic bulletin boards for transmission of messages among users in the field of general interest.

Entertainment services, namely, production and distribution of motion pictures, comedy, musical, reality, news and dramatic television series, documentaries, and television series featuring sporting events rendered through the media of television, cable, satellite, radio, telephone and broadband systems, and via the internet, and portable and wireless communication devices in class; providing information in the field of entertainment rendered via the internet and portable and wireless communication devices.

DAVIES COLLISON CAVE Patent and Trade Mark Attorneys 1 Nicholson Street, Melbourne, Vic, 3000, Australia Telephone: +61 3 9254 2777 • Facsimile: +61 3 9254 2770 E-mail: clowe@davies.com.au

Precision shipping.

There’s nothing hit or miss about Hamburg Süd.

With our frequent sailings, reliable schedules and worldwide multi-trade network, our supply chain management services get straight to the point.

For more, please contact Williams & Gosling Ltd n

Suva:

(679) 331 2633 / info@wgfiji.com.fj

n

Lautoka: (679) 666 4090 / helpwest@wgfiji.com.fj

www.hamburgsud-line.com

Islands Business, November 2013

Business

Agribusiness...potential is clear. PNG could become a key food bowl for Asia. Photos: Paradise

PNG and the Asian Century Can the country be transformed by these once-in-a-century opportunities?

By Rowan Callick The view over Port Moresby’s beautiful, deep-water Fairfax Harbour from Deloitte Tower speaks volumes about Papua New Guinea’s immense potential.

Below are ranks of new tower blocks, almost all built and owned by two superfunds and Steamships, the local arm of the venerable Hong Kong-based Swire conglomerate.

The container port on reclaimed land is already overcrowded and needs shifting—providing a potential goldmine for developers—and doubt22 Islands Business, November 2013

less also for politicians who usually seek to gain from any big deal.

Across the harbour to the left is the InterOil refinery, providing monopoly fuels from PNG sources at monopoly prices.

In central vision in the distance is Motukea Island, reached by a causeway, where Australian construction entrepreneur Mick Curtain, from Townsville, who built much of the US$19 billion liquefied natural gas project in partnership with Cloughs of Perth, has his massive base with a shipyard including a huge dry dock.

To the right, where the nation’s original parlia-

ment building stood, a gleaming new, blue-tinged office and apartment building is rising fast, built by a Chinese company whose workers, from China, live in cabins on the site.

The reclaimed land beyond the container terminal now houses a “harbour city”, home to the Royal Papua Yacht Club.

On October 15, the club hosted a breakfast for more than 200 members of the Port Moresby Chamber of Commerce and Industry, where Grant Mitchell of the Australian consultancy firm Port Jackson Partners launched a thoughtprovoking report produced for ANZ Bank: “Bold Thinking: Imagining PNG in the Asian Century’’.

This estimates PNG could land US$412 billion in commodity exports by 2030, not just from its abundant oil, gas and minerals, but also from becoming a key food bowl for Asia—with prominent contributions from coffee, cocoa for chocolate, and palm oil, as well as from tuna, of which PNG controls the world’s biggest resource.

Potential for agribusiness The potential for agribusiness is clear, with just three percent of cultivated land being used for export cash cropping and with the water supply almost five times per head greater than Australia’s.

As planes arrive at Lae’s Nadzab Airport, they sweep over the vast land being managed by New Britain Palm Oil across the fertile Markham Valley, with its commercial sugar and palm oil plantations and premium beef herds.

Business

Almost all of PNG’s food exports...head to Europe and the US, in part because of preferential access.

“Stick anything in the ground and it will grow,’’ says Port Moresby Chamber of Commerce’s ebullient chief executive Dave Conn.

“But transport and marketing are the big challenge.’’

Half the global growth in food demand is now coming from Asia—but almost all of PNG’s food exports go to Europe and the US, in part because of preferential access.

To reach that US$412 billion commodities target, PNG would need to invest US$172 billion, chiefly in infrastructure. How to attract and use such vast capital effectively is an immense 21st century challenge.

Infrastructure is crucial, the report says.

Port turnaround times are three times those in Australia and container export costs much higher.

International travel to key Asian destinations can be 10 times the cost from Australia.

Only 12 percent of households have access to power. And only 2.3 percent of the population has internet access.

Sovereign risks, the report warns, arise when governments change tax or operating rules. At present, resources sector investors rank PNG’s potential at just 73rd globally.

Prime Minister Peter But it jumps to third, his energy, enthusiasm behind Canada’s Yukon Maclellan and Mongolia if landuse restrictions are relaxed and best-practice policies are introduced.

The report will now be roadshowed in Brisbane, Auckland, Beijing and Singapore. It looks at the medium term to 2030 and urges a development approach that brings together the three key activities in the economy: resources,

agriculture—including fisheries with PNG owning the world’s biggest tuna resource—and infrastructure development.

“Most high-growth countries develop and rely on multiple sectors at once,’’ the report says. This is especially important for PNG, whose population exceeding 7 million is expanding so fast that it will exceed Australia’s 22 million population this century.

It concludes: “Asia promises to become the world’s major supplier of capital during the 21st century and a virtuous circle of trade and investment will converge for PNG. Now is the time to begin a national conversation about clear and obvious threshold issues.’’

Promise and performance The yawning gap between the country’s huge promise and its performance was underlined by the frequency with which Mitchell’s presentation to the Port Moresby Chamber of Commerce was interrupted by blackouts.

Power, water, ports and the dominant airline are state owned—and the government, the strongest in PNG’s 38-year history, backed by 104 of the 111 MPs, appears more inclined O’Neill...praised for to boost its role in business and vision. Photo: Nic than reduce it.

Mitchell’s report says the major state-owned enterprises return only 1.7 percent a year on their assets—one-seventh of the performance of PNG’s private sector.

The political culture, however, is a transactional one, focused on deal-making—where the temptation to become involved in “business”, whether on one’s own account or the govern-

ment’s—or sometimes both at the same time —is massive.

As politicians travel around Asia—about which PNG largely understands very little, despite Asia becoming the country’s chief market and potential source of capital—they tend to seize on what appeals. Thus Singapore’s huge pension fund Temasek, ultimate owner of Optus and Malaysia’s Petronas are being viewed as models for PNG, although it is the drive of the private sector that is primarily responsible for Southeast Asian success.

Deal making focus Because of this deal-making focus, considerable political capital and time are expended on battles over ownership—including recently the nationalisation of the Ok Tedi mine; Commerce Minister Richard Maru’s refusal to allow Malaysian blue-chip Kulim to extend its stake in New Britain Palm Oil; conflict with Fiji investors over control of the country’s second mobile network, BeMobile; and with Malaysian managers over Port Moresby’s water utility.

As the size of the prize rises—thanks chiefly to an ExxonMobil-managed LNG project that is close to completion with exports due to start next year, leading to a doubling of GDP—so the interest in the more modest responsibilities of government such as maintenance diminishes.

Yet Mitchell’s report says regular maintenance saves governments 100 times its cost. The decrepit state of PNG’s roads, hospitals and schools underlines the need.

The report was well received by the Chamber of Commerce members, some of whom have been saying the same for some years.

Among them is Syd Yates, chief executive of the Kina group of finance companies, who played a prominent role in creating the Port Moresby Stock Exchange.

The group was founded with $800,000 capital, whose value has grown 10 times in 16 years.

“It’s been a lot of fun,’’ he says. “My attitude is: Let’s make it happen, not think of reasons why it can’t…’’

He praises PNG Prime Minister Peter O’Neill’s “energy, enthusiasm and vision, which Islands Business, November 2013 23

Business is exciting for the business community’’, but adds that the quality of the public service must be upgraded if policies are to be implemented.

“It takes too long to get things done.’’

Yates says investment in education is even more essential than in infrastructure.

The country’s capacity will be strengthened, he says, when dual citizenship is introduced as announced, potentially luring back more of those who have built successful careers overseas.

Isikeli Taureka is one, a senior Chevron executive who has worked all over the world, including heading operations in China; he has returned this year.

And the PNG private sector, Yates says, offers examples that are more appropriate for future development than Asian state-owned enterprises.

Oil Search is a model of PNG-based achievement and good citizenship, for instance, he points out.

The finance sector has boomed, he says, since effective regulations were introduced and the central bank became truly independent under the Sir Mekere Morauta government.

neries in Lae and a fourth being built, plus one in Wewak and one in Madang, with a second in sight. Each of these employs up to 4000 people, mostly women.

Sir Pete Celso, managing director of RD Tuna Canners, came to PNG from the Philippines

Costing framework The government’s costing framework surprises the private sector. It will budget K12 million-K20 million a kilometre for highway construction, for example, whereas private construction firms estimate the cost at less than K3 million. Such gaps leave ample room for questionable practices, of course.

Lae port—where 75 percent of the country’s cargo is shipped—is being rebuilt by Chinese companies.

The Chinese government provides a K6 billion soft-loan facility for infrastructure in PNG, on the condition the work is chiefly conducted by its firms.

The cost of inadequate infrastructure is palpable.

Hornibrooks’ steel fabrica- Newly planted rice...could be heading to Asian markets. tion firm in Lae makes heavy trailers, but operations manager Bob Lewis says that bad in 1995, and says it’s rewarding but tough. “A roads are cracking them.

Harvard MBA doesn’t guarantee success here,’’ He says: “Get infrastructure and security unhe says. der control, and tourism, could fund everybody “The challenges aren’t found in books.’’ in PNG’’.

The country catches up to 17 percent of the Such is the country’s natural beauty and liveliworld’s tuna and cans for the US and especially ness of its traditional cultures. But few experts can Europe—it has a trade deal with the latter that see that happening any time soon. removes tariffs, whereas the competition from The biggest success story in employment Thailand has to pay 24 percent. terms has been the tuna industry, with three can24 Islands Business, November 2013

“Business will go where it can maximise profit,’’ Celso says. “That used to be in the west, but now things are changing.

“The focus is shifting to Asian markets’’— whose appetite is more for fresh fish.

Canning, freezing or chilling, the process requires immense power, the chief challenge for Celso, who says it is cheaper to use his own generator than to buy power from the grid—though the government requires him to do so as long as it is available.

His business demands 55 percent of Madang’s total power capacity.

“PNG has its own gas and oil,’’ he says, as well as hydro capacity.

“Power should be cheaper’’ and more reliable. It costs him more, due to the poor quality of the roads, to send a container of canned tuna to Mount Hagen in the Western Highlands than it does to ship it to Hamburg.

Another Asian business leader in PNG is Sir Soekandar Tjandra—also knighted by PNG—originally from Indonesia, who came in 1974 from Jayapura, where he was selling crocodile skins.

He now runs stores in 18 of PNG’s 19 provinces, provides most of the vanilla used in Australia and New Zealand, has an immense property portfolio, and owns Shorncliffe construction company.

Political class He lives in Lae so he can supervise the shipment of goods for his stores, 60 percent coming from China.

He differentiates his stores from those recently delocalised—often unpopularly —by new arrivals from China, with large notices saying: “This store is 100 percent nationally owned.” And “In PNG since 1974.”

The scene is well set. PNG has its core of remarkably resilient businesspeople from within PNG, from the Pacific, from Australia, New Zealand and Asia, to point the way. It has a can-do Prime Minister in O’Neill, who is the most powerful figure since Sir Michael Somare.

And it has the commodities—the gas, metals, agricultural products, and fish—that burgeoning Asia needs.

But can its political class transform itself so that it can in turn enable the country to be transformed by these once-in-a-century opportunities?

We shall know the answer within a year or two as the priorities and capacities of this five-year parliament play out.

Fly High with Air Niugini INFLIGHT WITH AIR NIUGINI VOL 5 2013

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

Business Japan to the CNMI to the continuing difficulty agents have had securing rooms for last-minute Japanese visitors to the CNMI this summer as competition for rooms from the South Korea and China markets becomes increasingly intense.

South Korea remains CNMI’s second major tourism market.

The slight one percent drop in Japan arrivals was offset by the record annual totals in visitors from China and Russia.

China arrivals have now reached 102,810 for the year, while arrivals from Russia have reached 10,476.

Hotel occupancy was also at 94.01 percent in August and 75 percent in September, the 12-member Hotel Association of the Northern Mariana Islands (HANMI) said.

This was an 11 percent and eight percent increase from the same months last year, respectively.

Room rates averaged at US$107.12 in September, compared to US$93.02 during the same month last year.

“The Northern Marianas has much to offer visitors in terms of natural beauty and relaxation,” said HANMI chairman Optimistic...Japanese visitors on Saipan. As of August 2013, total visitor arrivals to the CNMI had already reached 400,000, Nick Nishikawa, also the general manager exceeding fiscal year-to-date arrival levels last seen in 2006 when Japan Airlines was flying to there from Japan. Photo: www. at Hyatt Regency Saipan. discoversaipan.com Nishikawa said it is the hotel association’s job as a community to ensure that hotels, parks, beaches and villages are clean, attractive and safe.

CNMI tourism on the rebound

New construction, rennovation on the rise

By Haidee V. Eugenio Ronald Nicolas, 43, lost his full-time job as a mason about two years ago and has since been working part-time earning only US$200 on a good month.

But everything is about to change once again for Nicolas and many others like him who are either underemployed or unemployed in the Northern Mariana Islands.

New commercial constructions and building renovations have been on the upswing, thanks to steadily climbing tourism arrivals.

At least three new hotels are expected to be built within the year or so, while a number of existing hotels are either undergoing renovation or will soon get a facelift.

As a result, Nicolas finds his skills as a mason in demand once again and expects to soon have a fulltime job once again that pays at least US$5.55 an hour, the CNMI’s current minimum wage.

“I’m happy to have this chance again and I’m hoping the economy would keep on growing. I can now provide more for my family,” the father of three said in an interview while he was turning in his application paper as a mason.

Garry Malit, general manager at Island Manpower and Island Construction, said Saipan now has a “shortage” of experienced carpenters and masons like Nicolas, as most of those in these 26 Islands Business, November 2013

job categories had already left the island when the economy declined and no replacements were brought in.

Because of this shortage, manpower agencies are trying to get the remaining masons and carpenters already in the CNMI. Since late-September, Malit’s manpower agency—just like others in the same business— has been looking for over a hundred construction workers such as masons, carpenters, electricians, tile settlers, painters and plumbers. They are also looking for hotel workers.

As of August 2013, total visitor arrivals to the CNMI had already reached 400,000, exceeding fiscal year-to-date arrival levels last seen in 2006 when Japan Airlines was flying to the CNMI from Japan, the Marianas Visitors Authority (MVA) reported in September.

Upward trend The upward trend in arrivals has been a great source of optimism. The August 2013 visitor arrivals alone were up 12 percent—from 40,225 last year to 44,817 visitors this year.

Japan, which has remained CNMI’s main tourism market, brought in 17,755 visitors in August alone, just a one percent decrease from August 2012.

But key travel agencies in Japan, according to MVA, continue to attribute the flat market from

Optimistic “This is one way every citizen can contribute to building our tourism economy,” he added.

CNMI Governor Eloy S. Inos is also optimistic about the direction of the tourism economy and hopes that the current labor pool—U.S. and foreign workers alike—could meet the demands.

The reopening of Coral Ocean Point, which is now undergoing renovation worth at least US$4 million as part of an over US$40 million planned total investments, is just one of the major projects that is building optimism.

Moreover, the administration believes that more tourists would have traveled to the CNMI in the last few months had the islands had enough hotel rooms for prospective guests.

The U.S. Department of Homeland Security, meanwhile, placed a cap of 14,000 non-immigrants under the transitional CNMI-only worker or CW program for fiscal year 2014 starting on Oct. 1.

This is a 6.66-percent cut from the current 15,000 cap, which still takes into consideration an expanding economy even as transitional worker permits reached only some 12,000 the previous year.

However, if the transition CW program is not extended beyond Dec. 31, 2014, the CNMI is likely to plunge into abyss once again as the islands would lose immediate access to over 12,000 skilled and professional foreign workers.

But the CNMI’s non-voting delegate to the U.S. Congress is also pushing for a pathway to U.S. citizenship for hundreds of legal foreign workers who have stayed for a long time in the CNMI. This is part of a U.S. immigration reform bill that provides some 11 million illegal immigrants in the United States a chance at citizenship if they meet certain requirements.

Politics

NEW ZEALAND

on the electoral roll. Seems like a small ask, but when it isn’t seen as a priority, then it’s going to be quickly forgotten and people won’t do it.”

Pacific media had to play a bigger role in creating awareness too, says interim chair of the New Zealand’s Pacific Islands Media Association (PIMA), Will ‘Ilolahia. “(We) need to take up an additional responsibility not just to report on candidates or reprint political party press releases but help educate our target Pacific audiences on how, why and when to vote,” he says.

Key…engaging Pacific youth in politics is key. Photo: Manukau Institute of Technology

Voter apathy concerns NZ’s Pacific leaders Youth hold balance to 2014 election

By Peter Rees New Zealanders go to the polls next year and political parties will again battle for the sizeable Pacific vote—provided they can get them to the polling booths.

Despite Pacific people making up roughly 7% of the country’s population with six Pacific MPs in parliament, engaging them with New Zealand politics remains a challenge.

This contrasts with the increasing number of Pacific candidates who ran in the recent local body elections and those who will run in New Zealand’s general election next year.

A Pacific candidate ran for the Auckland mayoralty for the first time and a record 16 candidates of Pacific descent were elected in the local body elections in October. Still the turnout by voters was poor.

In the Pacific stronghold of South Auckland, less than 30% of eligible voters cast their ballots— lower than the citywide average. An outdated postal voting process and the lack of media coverage were blamed. But electoral authorities don’t expect the same trend for next year’s general election because of the more efficient systems used.

Voter apathy Voter apathy, however, remains a concern because past elections have shown the Pacific vote to be unpredictable. The fact remains; those residing in low income communities and especially youth

(aged 18-24) are least likely to exercise their democratic right and Pacific people are among the highest represented in both groups.

Pacific youth are mostly disengaged with politics, yet the most affected by the current economic climate. Since 2008, the number of Pacific youth receiving unemployment benefit jumped 616%.

“What we have to get our heads around is that the Pacific population is young,” says former Labour MP, Carmel Sepuloni, who is aiming for a return to parliament next year after losing her seat in 2011.

“The median age at the 2006 census was 21 years old for Pacific and 35 for all New Zealanders,” she points out.

“The best way to engage young voters is to try to get as many as possible to be active contributors to a campaign,” she told Islands Business.

“They are the ones that have the power to enthuse their peers. What we are seeing more of is the importance of social media. We saw this with Obama’s campaign and we are seeing more and more of this in New Zealand politics.”

Outside of the youth vote, Sepuloni says the bureaucracy must be sped up and made easier for Pacific communities to engage with and she recommends that electoral data gathering be part of the process of enrolling with a new school or doctor.

“As a community, we are less likely to own our own homes, so transience is an issue. Each time we move we are expected to update our details

What is at stake There is much at stake for the Pacific community. A report released by the Salvation Army in May found that while Pacific people were engaging more in tertiary study, 40% of Pacific children live in poverty.

The average weekly income of Pacific people had risen only NZ$2 a week over the past five years, compared to an increase of NZ$54 for non-Pacific people.

And despite a promise of 170,000 new jobs, the Pacific unemployment rate more than doubled since 2008, rising from 6.3% to 15.2%, compared to the national rate of 6.7%.

That is nearly 9,000 Pacific people who have lost their jobs, mostly in the manufacturing and service/hospitality sectors.

Creating jobs will be one of the big issues for the Pacific people in next year’s election, says Obed Unasa, who was elected to the Maungakiekie-Tamaki board.

“Jobs, housing, education are some of the urgent issues that require a Pacific voice and the only way we are going to see change that benefits our people is to vote.

“The power of the vote is something that we need to focus on and to create an education process through our own networks—churches, community groups, schools and families.”

Although change seems to be back on the menu, this does not mean Pacific people will automatically vote en masse for Labour. Times have changed.

In the last election in 2011, when the National Government was re-elected for a second term, many Pacific voters stayed home. This apathy mirrored the overall nationwide turnout of 74.2%. In other words, approximately 800,000 New Zealanders did not bother to vote. That was the worst turnout since 1887.

National’s strong polling leading up to the 2011 election and disunity within the ranks of the Labour Party, which led the Opposition, was partly to blame for voters staying home. It was widely believed that the National would win and riding a wave of glowing media coverage, described in a 2012 report as heavily biased towards the government, they did.

Three years prior when National ended Labour’s nine-year reign and the political career of former PM Helen Clark at the 2008 election, the result reflected the mood of the country wanting change “for change’s sake”.

That election witnessed the Pacific vote being divided for the first time. For years, Labour had been the default choice for Pacific voters because of its traditional links with the working class and the unions.

Islands Business, November 2013 27

Politics Emergence of new class of well educated Pacific people But the emergence of a new class of well-educated Pacific people in good jobs, many products of mixed marriages found common ground with National, other right wing parties and even on the far left such as the Greens who sought to protect their individual interests.

Then, there was the emergence of the Conservatives, among them the now defunct Pacific Party led by the disgraced former Labour MP, Taito Philip Field, which reached out to Labour’s conservative Christian element, disillusioned by increasingly liberal policies, among them the controversial “Anti-Smacking” bill.

Labour also saw its Maori vote weaken because of the rise of the Maori Party which arose from the controversial Foreshore and Seabed bill.

“Labour ties have been severely tested which has alienated many within the Pacific community.

The resulting drop in Pacific voter participation has been a ‘no-vote’ in Labour as opposed to an endorsement of other parties,” adds social entrepreneur, Essendon Tuitupou.

“My feel is that there is a general disillusionment amongst the Pacific community with politics in general. The response therefore seems to be ‘I’m not happy with Labour’s policies but don’t like what the government is doing, therefore I won’t vote’.”

Conservative Party candidate for Mangere, Fa’avae Gagamoe, told Islands Business that Pacific voters “need a compelling reason to change; otherwise the status quo is fine for them”.

Sepuloni agrees: “Our young people don’t want to be told to ‘vote Labour because that’s who we’ve always voted for’.

“They want better arguments than that. What is equally important is having a clear understanding of what a political party will do for them in the future.”

Pacific musician, Kas “The Feelstyle” Futialo says voters need an incentive to vote and better communication of messages is the key.

“We need to be hungry for change. I don’t think it is clear enough to the voters how important their vote is. They’re listening, but they’re not hearing it.”

With the New Year fast approaching, National continues to lead the polls. But the demise of their coalition partners ACT and United Future is a concern for them. Their other coalition partner, the Maori Party holds the balance of power, but they could easily swing to the other side after the election.

In the Opposition ranks, Labour has finally found some stability under their new leader David Cunliffe. The rise of the Greens since 2011 has given Labour a powerful axis to topple the National Government, provided New Zealand First and Mana parties also fall in behind them.

The importance of the Pacific vote is not lost on Cunliffe. “If they come out, they will bring us home,” he says. “In 2005, against what the polls predicted, South Auckland and West Auckland came out in numbers and Labour came home. I remember that night; I’ll never ever forget it. At 9pm we were 13 percent behind. In half-an-hour we were ahead by two percent. It was a thing of great beauty.”

New Zealand’s general election is usually held on the last Saturday in November. If this convention is followed next year, it will be held on 29 November 2014.

28 Islands Business, November 2013

SOLOMON ISLANDS

Solomon Islands....anecdotal evidence that arms smuggling activities have intensified. Photo: Islands Business

Just who are they arming themselves against?

Arms smuggling on the rise

By Alfred Sasako Before he was dethroned in November 2012, Prime Minister Danny Philip flagged with Australia the idea that Canberra considers building a refugee processing centre in Solomon Islands.

His choice for the facility was Sterling Island in the Shortland Group in the nation’s far north, closer to the Bougainville border.

The sea border between Solomon Islands and its northern island neighbour of Bougainville has been notorious for alleged arms smuggling activities and cross border raids by Papua New Guinea’s military in pursuit of the so-called Bougainville rebels.

Philip’s idea was that the facility would serve as a one-stop shop, first as an offshore processing centre for refugees wanting to enter Australia and secondly, as a customs and immigration outpost for Solomon Islands to cater for those trying to enter the country via Bougainville.

Most importantly, it will serve as the surveillance centre for any illegal activities in the area. As for staffing, it will be jointly manned by Australian and Solomon Islands personnel.

Underlying the proposal was the need to keep the fragile peace in Solomon Islands alive given that the Regional Assistance Mission to Solomon Islands (RAMSI) was then scaling down its presence in Solomon Islands.

As of July this year, the military component of RAMSI has been totally disbanded. This has created a vacuum, raising community fears that the so-called ethnic tension could flare up once again.

Philip’s fear was that arms and drug smugglers could capitalise on the vacuum created by

RAMSI’s departure.

Australia, under the Labor Government, reportedly rejected the proposal outright, perhaps of the cost implications.

There is no indication the present LiberalNational Coalition Government in Canberra would think any differently should it be presented with the proposal again.

It is not clear either whether the present Honiara administration of Gordon Darcy Lilo would dust up the proposal and take it up with Canberra. Either way, it appears Philip’s fears are coming to pass.

Today, there are reports that arm smuggling activities are on the rise. But unlike in the past when Bougainville nationals were allegedly involved, there’s been a change in terms of the players.

“Yes, the arms and ammunitions still originate from Bougainville, but this time the vendors are Solomon Islanders,” one source familiar with the activity told me.

“The most frightening thing about it all is that the illegal arms trafficking is being linked to the missing millions in royalty payments to landowners of the Gold Ridge mine,” the source said.

“Someone out there is buying,” the source said.

It’s been widely publicised that up to SB$18 million (about US$2.5 million) in royalty payments to landowners and the Guadalcanal Provincial Government have been siphoned off by private individuals. Police investigation into the matter appears to have stalled.

Customary landowners of Gold Ridge mine, Solomon Islands’ only commercial gold mine located about 30km east of the capital, Honiara, have not received their share of the royalty payments totalling some SB$14 million.

Politics “This money or part of it is being allegedly used to buy arms and ammunitions being smuggled across the border from Bougainville,” the source said.

An internal inquiry has established that senior public servants dealing with the payments had departed from laid-down procedures, resulting in the money being paid into private accounts.

The disappearance of the royalty payments has angered the customary landowners. So much so that they’ve decided to invade the mine’s pits at night digging for gold and selling them in the open market to recover their loss.

“There are serious allegations that funds from the missing royalty payments are being used to buy arms and ammunitions coming through from Bougainville. And it is Solomon Islanders that are doing this. It is no longer Bougainvilleans,” the source said.

Others said this could simply be an arrangement where Solomon Islands nationals are being used as agents on a commission basis.

“Using Solomon Islands nationals is intended to lessen the risks of being caught,” the source said.

There is anecdotal evidence that arms smuggling activities have intensified with those involved getting bolder.

A former senior public servant from the Shortlands told me of an incident involving a large consignment of arms and ammunitions mid-year.

“A motorised canoe from Western Province came all the way to Honiara. It then went up the Alligator Creek and stopped at a point not far from Honiara International Airport where it offloaded its cargo,” the informer said.

“It seems the trip was pre-arranged,” he said.

There is anecdotal evidence too which points to the alleged use of royalty payment money in arms smuggling activities.

Take for example two people who were accused of siphoning some of the funds from the royalty payment.

“They used up SB$7 million (about US$1 million) in just three weeks. Now, what can you spend that kind of money on in such a short time?” sources close to the duo said.

“Yes, perhaps one can spend that kind of money investing in properties, but how many properties in Honiara can fetch a million-dollar price especially at a time when the market is flat since RAMSI’s pull-out last July?” the sources said.

Apart from the local buyers, there is allegation that an external intelligence organisation is also buying arms in the black market.

“This intelligence organisation is buying simply as part of evidence gathering for security briefing purposes,” the source said.

Other information suggests that some Asians are also involved in the gun smuggling trade.

One in particular is allegedly storing a large cache of weaponry in Honiara. Although authorities have been tipped about the businessman’s activities, police have yet to take any action.

The Asian individual is said to have strong political connections.

Given that guns stolen from the Rove Police Headquarters armoury in 2001 still remain in the hands of ex-militants and reports of arm smuggling make the fragile peace in Solomon Islands look even more fragile. Because however it is viewed, the various pieces of information pieced together in this article make for a frightening scenario indeed.

The challenge of making land leases bankable An ambitious project but can be done

By Dr Satish Chand Bulk of the land within the Pacific Islands is under customary tenure. PNG, as an example, has 97 percent of its total land area under customary title. There are some very good reasons for the above.

The property rights to land in most Pacific islands nations have been acquired, protected and maintained through the physical might of the clans. Pre-colonisation, land conflicts played a dominant role in rationing the limited supply of alluvial land to potential users.

And the period in the lead-up to colonisation saw some expatriates obtain land through deceit or with the deployment of physical forces, sometimes in cahoots with one or more resident warlords who had their own agenda of defeating their arch-rivals.

Thus the stories of chiefs handing over land of their neighbouring tribes to white settlers following the defeat of the latter in wars fought with muskets and men from afar.

The colonial masters such as the first governor of Fiji banned alienation of land with the view to protecting the indigenous population from losing their most valuable resource. This was timely as otherwise much of the land currently under customary title within Fiji would have been lost.

A similar argument holds for much of the Pacific. But it may be time to rethink customary tenure with a view to protecting ownership whilst allowing longterm investments for growth in income of the people of the Pacific.

its owners. This was brought home to me by the expatriate manager of a large foreign commercial bank operating in PNG. He relayed the story of Jo (not his real name), a senior employee of the bank who had his application for a home-loan declined.

The manager wishes to extend the loan and Jo is desperate for the advance but the deal cannot be struck. Jo clearly has the capacity to service the requested loan and needs it to extend his house in anticipation of a newborn.

The manager has his reasons too: the loan will add to the bottom line of the bank and will amount to ‘doing the right thing by his valued employee’. But alas, the loan cannot be extended.

The house is built on land belonging to Jo’s clan. As a member of the clan, Jo is a landowner and the individual with the exclusive right to build on the plot. However, he cannot use the land as collateral.

The laws do not allow the use of land held under customary tenure as collateral and it would not matter even if the laws did. This is because enforcing mortgagee rights on the land in the

Challenge In the words of Dr Puka Temu, a politician and former Minister of Lands and Physical Planning, the challenge is to turn customary landowners into landlords who are able to reap the full rewards of the rights to their land.

Land held under customary title has costs to Islands Business, November 2013 29

Politics

papua new guinEa

which is home to middle income nationals, climbed from K350,000 in July 2008 to K800,000

by March 2013—more than double in just five years. Prices of residential homes within the fringes of the city have increased three-fold.

Most in Port Moresby will attest to the fact that homes for the majority of the population are no longer affordable in the established (and serviced) suburbs within the National Capital District.

This fact has been driving the rapid rise in the number of informal settlements and the growth of the population therein.

Policymakers have been working towards increasing the supply of land for residential construction.

The recent reforms alluded to earlier allow land held under customary title that is lying idle within and around NCD to be used for real estate development.

Several clans are interested in registering their land and leasing them out (to locals) for the construction of residential homes.

If successful, then PNG would have pioneered a scheme that would have PNG land reforms relevance to the broader The ‘Land Groups Incorisland-Pacific. poration (Amendment) Act The ongoing reforms 2009’ provides the legislative are helping increase the framework for customary supply of land for residenlandowners to incorporate tial construction. The vast as legal entities and then majority of the investors register their land with a are locals. view to leasing the unused The problem for many portions, following proper is accessing finance. Buildcadastral mapping, to the ing a house, as most of us private sector. who have ventured into The land thus availed can doing so know, costs a be leased through the ‘Land lot of money. And worse Registration (Amendment) still, all of the outlays are Act 2009’ for a term of up upfront. Loans to build to 99 years. and buy homes are the Crucially, the progress norm for the majority of on these reforms is due to the population. them being locally led and Bankability of land is domestically designed with critical to the growth of a clear mandate to provide a healthy real estate secsecure and long-term access Breathing life into dead capital...PNG reforming land held under customary title. Photo: Paradise tor. PNG is pioneering to land held under customreforms to customary land ary title such that the above tenure so as to make the could encourage investment leases bankable. ting home owners access to finance from the and growth of income.

Policymakers are currently investigating the formal sector.

The architects were cognisant of the many options to making these leases bankable so that Bankability of the leases, however, demands previous attempts at land reform and the reasons folks like Jo can borrow from their banks to build the development of a secondary market—a marfor their failure. and buy houses. ket that is in its embryonic stages now. Demand They also knew that ownership had to remain The banks themselves realise that there is an for land for residential development in the capital, with the clans. The legislations have achieved opportunity to expand business but for the inadhowever, is rising. the twin objectives of protecting clan ownership equacy of collateral for extending credit.

The price of residential homes in Port Mowhilst providing tenure security. The landownMaking land leases bankable is an ambitious asresby has more than doubled over the past five ing groups (clans), via the enacted legislations, signment. Progress on this will require engagement years—thanks to the large Liquefied Natural Gas have the option of consensually availing their of all stakeholders; namely, the banks, landowners (LNG) project that commenced construction in customary-owned land for development on long and the real estate industry. It can be done so long 2009 for a total cost of US$19 billion (equal to and secure terms. as the process is not rushed. And any progress on 190 percent of PNG GDP).

The above may sound like a scheme to enable this agenda will be tantamount to breathing life to Median advertised house prices in Gerehu, foreigners to get hold of land currently under an otherwise ‘dead capital’. Watch this space! a suburb within the National Capital District customary title. This, however, is far from the

event of default, as the bank manager explained, is impossible.

In short, land held under customary title is not bankable. It is, in the words of one academic, ‘dead capital’.

Disturbingly, the ‘dead capital’ is often the only capital the bulk of the population have. And being unable to use the capital to access finance from the formal sector penalises the very people most in need of such services.

Could land under customary title be made bankable without risking the loss of the rights of ownership by the sitting clans? The answer is in the affirmative.

Papua New Guinea has put into effect reforms to land held under customary title such that clans can formally register their land and then lease out those portions that are not being used.

Two new laws; namely the ‘Land Groups Incorporation (Amendment) Act 2009’ and the ‘Land Registration (Amendment) Act 2009’ were gazetted on February 10, 2012 and came into operation from March 1, 2012.

30 Islands Business, November 2013

truth. The leasing, it is envisioned, will take place from the clan as a collective to individuals who will largely comprise members of the clan or other locals.

Thus, Jo could get his clan to lease the land to him on long-term basis on which his home sits.

This scheme has the potential to increase the supply of land for building of homes, permit-

Telecommunications

Can small islands sustain two telecoms?

shall Islands has landlines compared to other islands in the region that have up to 30 percent landline access.

Mobile usage is at 27 percent versus a 50-80 percent rate seen elsewhere in the Pacific, and internet usage amounts to only two percent while it is significantly higher elsewhere.

“The aim of the bill is to increase access and allow more people to use information technology,” said Alfred.

“Under a monopolistic environment, NTA’s performance won’t improve. This has already been proven repeatedly in many economic and development studies.” has brought broadband to the islands and allowed

By Giff Johnson Kijiner says simply that the market in the NTA to sell services to neighboring telecoms, it Marshall Islands is too small for two telecom has been the financial undoing of the company.

As the Marshall Islands parliament considcompanies, a view shared by officials in other The telecom was forced to use nearly US$2 ers the World Bank-drafted legislation to open the small telecoms elsewhere in the region. million of its own money to finance installation telecommunications sector to competition for “Market penetration is not limited because after government subsidy promises did not mathe first time, the future of the Marshall Islands these services are not available, but by the terialize. It has also defaulted twice during the government-owned National Telecommunicaeconomic conditions in the Marshall Islands,” past two years on loan repayments that were to tions Authority (NTA) hangs in the balance. counters Kijiner. be jointly shared between the government and The World Bank’s offer of an unconditional “By regional standards and the additional costs NTA—forcing the government to step in and pay grant of US$13 million in exchange for allowing of our remote location, NTA’s prices are reasonclose to US$2 million to the U.S. lending agency. competition in telecommunications has enticed able. But, the typical large household headed by a Marshall Islands Secretary of Finance Alfred the government to move forward despite warnsingle wage earner often has higher priorities for Alfred, Jr., also an NTA board member, says ings that the legislation will “kill” the existing their limited disposable income than DSL. The the Marshall Islands has already received US$3 telecom and saddle the government with its addition of more telecom companies will US$27 million loan debts. not change this economic fact.

Fiji-based Digicel, which is financed by “There also seems to be presumption the World Bank, is seen as the competition that additional telecoms in our small market waiting in the wings to enter this north will automatically result in increased total Pacific market. business in the market. To the contrary, National Telecommunications Authority little additional business can be generated (NTA) General Manager Tommy Kijiner, in a market in which most of those who can Jr. says it is a shortsighted thinking by the afford telecom services already subscribe.” government if it adopts the World Bank Kijiner pointed to the fact that when inspired legislation in exchange for US$13 competition came to Nauru, the local telemillion since it will “force NTA to cease its com went out of business as Digicel took business, thereby depriving our Marshalover and is now the monopoly employing lese shareholders of their investment in only eight workers and all calls are directed our company.” through Fiji.

During a late September hearing on the “There are no landlines on Nauru today.” legislation, Kijiner repeatedly emphasized He also said that NTA by law is mandatthat the legislation will give new entrants ed to provide universal coverage, even if it a significant edge over NTA. loses money, to extend telecommunication “It is not fear of competition,” Kijiner service to the outer islands. Over the past said of his opposition to the legislation. several years, the telecom has established “Rather it is fear of the unfair nature of the call centers on nearly 20 remote outer isproposed legislation.” lands none of which can function profitably Earlier this year, when the legislation because of small customer bases. was first up for review by government, Kijiner has a list of areas in the proposed NTA asked to be consulted before it was legislation that he’d like to see modified to introduced to parliament. provide an even playing field for everyone, “We were directed by cabinet to meet not only new entrants. with the Chief Secretary, Attorney-General A key point is the legislation allows new and Secretary of Finance (to discuss modientrants to use NTA telecommunications fications to the legislation),” Kijiner said.

“The morning we were to meet, the Costly cable...in 2009, a new fiber optic cable linking the Marshall Islands equipment, which means, “a new entrant World Bank consultant on the project to Guam was installed in Majuro, bringing broadband access to the nation can come to the Marshall Islands and the first time. But the US$22.4 million price tag for the cable has compete with minimal investment and thus was in town and said if we were make any for undermined the national telecom’s ability to deliver services and meet little commitment to the Marshall Islands changes, the first US$3 million will not be loan payments. Photo: Giff Johnson marketplace. If there is to be an equal playforthcoming.” That aborted the local coning field, a new entrant must shoulder its sultation and the World Bank written legown capital investment costs and not simply use million from the World Bank and once the bill islation has now been introduced to parliament. the infrastructure that NTA has spent 26 years is passed, the remaining US$10 million will be NTA, which has significant private sector building.” given to the government. The funding can be investment but is still majority owned by the “Pass this bill and this will be the most expenused for anything government decides, which is government, has been a legislated monopoly since sive US$13 million grant you’ll ever get,” Kijiner one reason it has gained support. it was established in the late 1980s. told parliamentarians at the recent public hearing.

Alfred fully backs the World Bank plan and says The government guaranteed two large loans But with the World Bank dangling US$13 competition will promote economic developfrom the U.S. Rural Utilities Service to fund the million in front of a cash-strapped government, ment and also improve people’s access to internet initial establishment of NTA and its services, and the legislation is likely to gain traction in the final and phone service. four years ago, the installation of a submarine six meeting days of the Nitijela that will extend He cites landline usage statistics, saying that fiber optic cable linking the Marshall Islands to into November. only six percent of the population in the MarGuam. Although the fibre optic cable investment

Marshalls market too small

Islands Business, November 2013 31

Mining

Deep sea mining or fisheries?

seafloor, Dr James Hein, senior scientist of the United States Geological Survey, said many of the metals found in the deep ocean can provide environmental benefits such as green technology: “These deposits are very rich and almost all metals and all of the rare metals, particularly, for example, tellurium, which is very important in solar cell industry for a petroleum cadmium alloy, which is the best substance for transforming sunlight into electricity. And these deposits, these ferromanganese crusts in the deep ocean are the largest source of tellurium on earth.” about the fauna, the biota, and if people are to Representatives from regional agencies giving

By Anouk Ride & Chelcia Gomese start mining those, then it’s gotta be done in a advice on both fishing and mining agree that responsible way that’s not going to wipe them there is a lot of misunderstanding about deep As interest in deep sea mining grows, one out, basically.” sea mining and there is a need for awareness of question that comes up time and time again is Closer to the surface, Clark, says the risks can the general public. what impact would deep sea mining have on be managed but need to be understood before Then those Pacific Islands governments confisheries? deep sea mining starts: “It is important to ensure sidering deep sea mining need proper legislation Deep sea mining is a new industry as opthat mining doesn’t occur in known spawning and policy to deal with this emerging industry. posed to fisheries, which has long been a leading areas or regions where small fish are abundant Part of the longer term challenge here is the source of government income, exports, jobs and (“nursery grounds”). need to skill up Pacific Islanders so national food security. So naturally people want healthy “Knowledge of the nature and extent of sedigovernments have more specialists like geologists fisheries more than any new and potentially risky, ment plumes generated by the seafloor mining and marine scientists to deal with the industry extractive industry to go ahead. But do you have operation must be assessed before mining starts. as it develops. to decide between one or another?

“The discharge of processed waters also needs Representatives from PNA and SPC agree The answer seems to be no, according to to be carefully understood, and should occur that the key is both effective national regulation experts. “It is not anything like a case of fish OR deeper than the depth of fisheries (and other and more collaboration between Pacific Islands mining: both can easily operate side by side becountries so that they negotiate cause mining at sea depths of 1500 for fair and environmentally to 5000 metres will not affect fishing responsible access to their deep near the surface waters. sea minerals.

Good management can allow For Brownjohn, one of the both to coexist,” says Professor game changers that put Pacific Mike Petterson, Director, Applied Islanders in charge of setting Geoscience and Technology Divithe rules for fisheries was sion of the SPC (Secretariat of the having minimum terms and Pacific Community). conditions for fishing licences, Dr Malcolm Clark, Principal so he encourages governments Scientist at New Zealand’s National to do the same with deep sea Institute of Water and Atmospheric mining.

Research (NIWA) explains in more Akuila Tawake, Manager of detail: “The main Pacific fisheries the SPC-EU Deep Sea Minare pelagic, with skipjack, bigeye, erals Project, which provides yellowfin and albacore tuna extendtechnical support and advice ing to depths of about 300 metres. to improve technical capacity, “Deep snappers are found closer community involvement and to the seafloor, to depths of about government management of 400 metres. Other deep sea comdeep sea mineral resources, mercial species such as alfonsino says there is a need for Pacific and bluenose can go deeper still, to Islands countries to work to700 metres. gether to avoid irresponsible “The main potential seabed mineral resources in the western Pacific Proper management required...if we are to have healthy fish stocks and deep sea mining too. mining.

“We are encouraging Pacific occur deeper than these fisheries: Photo: www.nautilusminerals.com Islands countries to move away seafloor massive sulphides at 1000 from what we call a ‘race to the metres and deeper, and manganese bottom’ scenario, where countries have to work important animals (other fish species, sharks, nodules at around 4000 metres. on their own and compete against each other. I marine mammals, etc).”

“Many of the most damaging impacts of seabed think that’s a bad scenario for the whole region.

Maurice Brownjohn, Commercial Manager of mining (the physical disruption and dense sedi“We want them to work together, against a the Parties to the Nauru Agreement (or PNA), ment plumes generated) will occur at the seafloor, background of limited resources and limited which manages the world’s largest sustainable and in most cases this will be too deep to directly knowledge that they have, so we can pool those tuna purse seine fishery across eight Pacific Isaffect Pacific Islands fisheries.” resources together and strengthen our policy and lands countries, describes the risk to tuna fishing However, that does not mean there is nothour legislation and our capacity to be able to fully from deep sea mining in one word: “Minimal,” ing living down there. Marine scientists are still and meaningfully engage in this new industry.” then adds: “Provided it is regulated. Most deep learning about the hundreds of new and unusual Just like fishing, the potential economic growth sea mining sites are only as large as a few football organisms that depend on hydrothermal vents for from deep sea mining offers benefits but stakefields and have minimal tailings. life. These new species include giant mussels that holders still need much more discussion, such as “If it is regulated, it will have less environmenare the size of plates and mouthless tube worms those being facilitated by the Deep Sea Minerals tal impact than submarine volcanoes for instance. that can reach several metres in length.

Project, to prepare for this new extractive industry But it is important governments set minimum Dr Ray Binns, Honorary Research Fellow at while protecting fish stocks. terms and conditions and enforce standards for the Commonwealth Scientific and Industrial Only through proper management, can we exploitation.”

Research Organisation (CSIRO—Australia’s nareally can have our healthy fish stocks and deep While such questions are still being explored tional science agency), advises caution around sea mining too. about the impact sea bed mining will have on the hydrothermal vents: “There’s a lot of concern

Scientists say both can operate side by side

32 Islands Business, November 2013

Aviation

Service with a smile...Fiji Airways cabin crew at work.

Photos: Fiji Airways

Pichler reconsiders fresh alliance with Qantas Scope to broaden market prospects

By Davendra Sharma Fiji’s national airline Fiji Airways is reconsidering a fresh alliance with Qantas under a four-pillar plan.

At the centre of talks involving management of the two airlines is a former Virgin Airways executive, Stefan Pichler, now at the helm of Fiji Airways.

Pichler asserts that despite differences between the Fijian government—which controls the board of Fiji Airways—and Qantas, the two carriers still codeshare on certain profitable routes.

The Fiji Government has made no secret that it would like the Australian giant to part with its 46% stake in the rebranded Fijian carrier.

Ownership issues aside, the business deals between the two are yielding enormous benefits to both airlines.

“I think our relationship with Qantas is of future benefit—they make money out of it, we make money out of it,” Pichler was quoted in the Australian media.

Regarded by some aviation insiders as a master strategist, Pichler is an airline veteran with a

colourful background having worked for Virgin Blue, Lufthansa and until recently for Gulf carrier, Jazeera Airways.

Four-fold plan Under his broad and mega four-step plan, Pichler expects to implement changes encompassing the Fijian carrier’s network, fleet, operational and product strategies by the year’s end.

Moving from the airline’s old regional brand name of Air Pacific, Pichler has announced fleet changes with the delivery of a third Airbus A330 in November, paving the way out for the last of its fuel-thirsty Boeing 747.

With Qantas, there is scope to broaden market prospects with mutual benefits for both carriers on the multi-million dollar Australia-Fiji routes.

A one-time rival of Qantas chief executive Alan Joyce, Pichler reckons there is enough dime for both men with the folding of a new deal.

“I think we can extend it. I’m talking with Alan so at a certain point in time we can discuss that, to extend this partnership to mutually benefit both carriers,” Pichler was quoted as saying last month.

In his push to make Fiji Airways a force to be

Stefan Pichler…new Fiji Airways CEO.

reckoned with in the region, Pichler also hope to instill professionalism amongst middle and senior management at the airline’s hierarchy.

Engaging with customers and preparing employees for long-haul careers at the airline will add a new dimension to the airline’s focus.

“For example, we are working on a pilot career which starts at (domestic Fiji routes) Pacific Sun and leads up to the Airbus A330s at Fiji Airways, so people can plan their careers for a longer period of time within our group,” he said.

Air fight Pichler’s pitch with Qantas will place Fiji Airways in direct air fight with his former airline, budget-cost Virgin Airways and Qantas sister carrier, Jetstar—both respected carriers of Australian tourists to the Pacific islands region.

Virgin has also launched an assault on the Pacific islands market with special deals with Air New Zealand and the Middle East-based rich Etihad Airlines.

Pichler said any changes he is contemplating would be made on the basis of keeping Fiji Airways profitable and self-funding.

Islands Business, November 2013 33

Aviation

Upgraded…Solomon Airlines’ Dash-8 at the upgraded runway at Nusatupe in Gizo. Photo: David Keru

Gizo airport opens for business Now more opportunities for growth

By Evan Wasuka Solomon Islands’ busiest domestic airport, Gizo in the Western Province, is back in business with a new all-weather runway, following a fivemonth closure.

The newly refurbished runway was opened by Prime Minister Gordon Darcy Lilo in September.

Solomon Airlines General Manager Operations and Commercial Gus Kraus said the improved infrastructure will benefit travel in the province.

“With the new all-weather runway, flights will no longer be disrupted by weather issues, which means better service to the public.”

Prime Minister Lilo whose home constituency is Gizo, was on hand to celebrate the opening of the airport.

He commended the upgrading saying the improvements would boost the province’s economy with increased transport and the movement of goods and people.

“This provides opportunities for the rural people to participate more in economic activities and raise their living standards.”

He urged the communities in Gizo and the surrounding areas to look after the infrastructure and to utilise it for the benefit of the province and country.

The re-opening of the runway is part of a plan worth SB$150 million funded by the New Zealand Government to redevelop runways at Gizo, and Munda and the road between the townships 34 Islands Business, November 2013

of Munda and Noro in the Western Province.

The project is managed by AECOM and supported by the Solomon Islands Government’s Ministry of Infrastructure and Development.

Infrastructure construction was by the New Zealand company Downer and is one of New Zealand’s biggest investments in the country.

The upgrade of the Nusatupe runway for Gizo focused on resealing the tarmac surface with contractors battling against bad weather to deliver the project within its timeframe of end September.

With Gizo central to the country’s tourism industry, Prime Minister Lilo said the upgrade was vital in ensuring travel safety and regular services for the tourism market as well as the public.

Vision of Western Province “We should all be proud for the work delivered here. The upgraded runway will further the vision of the Western Province as the leading tourism destination in the Solomon Islands.”

Lilo said the Nusatupe upgrade is part of the government’s focus on the transport sector as a central part of its rural development policy.

“Since 2007, the government has targeted investment in national and provincial infrastructure to improve connectivity for Solomon Islands transport network as a whole.”

He said the national transport plan is the government’s approach to integrating sea, air and land transport systems as a way to promote development.

With the Prime Minister at the opening of

the runway was the New Zealand’s acting High Commissioner to Solomon Islands, Sarah Wong.

“The Munda and Nusatupe runways and the Noro-Munda road will act as a catalyst for economic growth in Western Province and Solomon Islands through more reliable and safer air links, and through linking communities and producers better to services and markets.

“For Gizo and the surrounds, the redevelopment of Nusatupe runway introduces a much safer and more reliable airstrip that will bring immediate benefits to key economic areas such as tourism,” said Wong.

The way forward, she said, is for stakeholders to look at ways to utilise the new developments.

“Now that the core redevelopment of Nusatupe and Munda runways and Noro-Munda road, has been completed, it is important that the Solomon Islands Government, private sector and the community think about how to maximise return on these investments.

“For the Gizo community and the surrounding areas, this is now a good time to think how as local businesses, government bodies and as a community we can collectively raise economic activities such as tourism to capitalise on the new all-weather runway.

“There is now greater access for travellers to the region. What services and at what level of quality, can they expect when they get here?”

With the Nusatupe upgrade completed, the government has been urged to carry out routine maintenance to preserve its state.

Wong said it was important too, that additional infrastructure and services should also be considered.

Looking forward, the Prime Minister Lilo called for continued co-operation between the government, communities and stakeholders.

He commended the way stakeholders worked together during Nusatupe’s closure to ensure that passengers travelling to Gizo were able to reach their destination through timely and safe boat transfers from Munda.

He urged for this spirit of cooperation to continue.

Technology

Unmanned aerial vehicle...Ready for take off in the Pacific region? It is technology that Palau President Tommy Remengesau, Jr.hopes will shift the balance in favor of the Pacific islands to enforce fisheries rules. Photos: Courtesy Office of the President, Palau.

Palau’s first trial...Drone technicians guide and monitor an unmanned aerial vehicle as it photographs a vessel during an initial demonstration in Palau recently.

Palau takes fisheries surveillance to new heights

ramp up our tuna stock assessments as well as our surveillance and enforcement capacities.”

He says UAVs have “very significant potential to expand the breadth of our surveillance capacity, to greatly increase the efficiency of this surveillance activity, and most importantly to decrease the cost.”

Australian billionaire Andrew Forrest is financing the initial drone effort. He visited Palau in January and has involved his Minderoo Foundation to work on the issue.

“Andrew absolutely loves the pristine environment of Palau and also loves the people there,” Minderoo Foundation’s Greg Parker told the breaking the rules.

By Giff Johnson AFP news agency.

A two-prong move by the Parties to the Nauru Although most islands in the Pacific have “He wasn’t going to stand back and watch Palau Agreement (PNA) member Palau could be a Australian-provided patrol boats, aerial surveilbeing bullied by illegal fishermen.” game changer for fisheries enforcement. Palau is lance is the key to effective fisheries enforcement.

Aerosonde’s Director of Operations Jack set to close its entire EEZ to commercial fishing One or even two patrol boats in a vast exclusive Kormas says while his company has been in the and begin the regular use of unmanned aerial economic zone—such as Kiribati or the Federated UAV business for a while, this is the first time to vehicles—drones —to enforce the closure.

States of Micronesia—are only marginally useput the drones to use for fisheries surveillance.

On September 30, Australia-based Aerosonde ful for fisheries enforcement without airplanes He described the trial run in Palau as successPty. Ltd officials conducted a demonstration flight spotting potential illegal fishing activity. But most ful. The UAV used has a three-and-a-half meter of an unmanned aerial vehicle (UAV) over Koror, islands countries can’t afford the wingspan, can stay airborne for cost of aerial surveillance, so it over 24 hours and is fuel efonly happens a couple of times ficient, he said. a year during joint operations “It’s able to send back video involving the Pacific Islands Foof any illegal fishing activities,” rum Fisheries Agency member he told Radio Australia after the islands nations and the United demonstration. “It’s able to send States, Australia and New Zeaback high definition still imagery land that provide navy and air of those illegal fishing activities.” force planes to direct patrol vesIt is this documentary evisels for vessel boardings. dence that Palau—and other A monitoring, control and countries who are following surveillance technical meeting of Palau’s UAV trial—is hoping will the Western and Central Pacific help it to ramp up enforcement Fisheries Commission held in and prosecution of illegal fishing Pohnpei in October discussed in its 200-mile zone. the fact that earlier this year, “The Pacific is a brotheraerial surveillance discovered Watchful eyes...Unmanned aerial vehicles offer islands an inexpensive way to gain video and and h o o d , ” s a y s R e m e n g e s a u . still photos of illegal fishing activity in their 200-mile exclusive economic zones.

19 Taiwan long-liners violating “Sometimes one brother needs WCPFC rules by not reporting to step aside so another brother their positions in waters near the can prosper. We believe that Marshall Islands. through the closing of our fishery in Palau, we Palau’s capital.

“If there were 19 vessels, regardless of flag, out can strengthen the fisheries in the Marshalls, “Our tuna fishery continues to dwindle,” said there not doing the right thing,” says Marshall FSM, Papua New Guinea, the Solomon Islands, Palau President Tommy Remengesau, Jr. at the Islands fisheries Director Glen Joseph, “imagine Kiribati and Tuvalu.”

UAV demonstration. what is happening with 3,000 long-liners and 300 And, he says, he’d like to see UAVs in use Remengesau announced this plan soon after purse seiners in the region.” around the Pacific. If the one-year trial goes well taking office in January for an unprecedented In mid-October, the Albacora Uno, a Spanish for Palau, drones are likely to be put into service third term as president. purse seiner, was fined US$1 million for illegally in many islands. It would change considerably “If we are to preserve this magnificent resource fishing in Nauru waters. Fishing companies know the probability of finding and prosecuting illegal for our children, leaders throughout the Pacific there is minimal enforcement capability in the fishing at a fraction of the cost to operate an air should begin to realistically assess our tuna stocks, islands so the odds of being caught may be worth force aircraft. reasonably limit fishing activities and seriously

Aerial unmanned vehicles to monitor EEZ

Islands Business, November 2013 35

Technology

Airship for the islands?

Taking advantage of new technologies

By Andrew Irvin*

The pitfalls of former designs have been relegated to the past, with a rigid internal structure composed of aluminum and carbon composites, the vessel is coated with a non-flammable highstrength mylar exterior.

Most importantly, the helium contained within (inert, not explosive like the hydrogen used for buoyancy in early airships) is controlled under a variable-pressure environment, creating lossless ballast and allowing for the first vertical landing and lift-off of an airship in history.

The first test flight on January 3, 2013, was a resounding success as the craft displayed this feature, hovering within its hangar at a constant

I first began paying close attention to the Aeroscraft project at the start of 2012 during a stint of research for a long-term aviation project with Ben Lucas, a young physicist based in Los Angeles, along the beach just south of Santa Monica’s airport, north of the airfields of Playa Del Rey where Los Angeles International Airport is located.

Often cycling along this stretch of the Southern California coast, where helicopters shudder along the coastline and hang gliders hop off the dunes of the South Bay beneath an endless thrust of commercial airliners out over the Pacific, we discussed the scale of air travel and ways to better utilise the airspace.

It was here where we filmed Ride the Sky, a short documentary entrant to the GE Focus Forward campaign regarding man-powered aviation research and more environmentally sustainable modes of air transportation, both for the individual and large-scale logistical purposes.

This led to greater familiarisation with the Aeroscraft project as it was coming into the last round of prototype development and beginning to garner a lot of anticipatory ML866 prototype...flight demonstration. Photo: Aeroscraft Media Press kit. press from science and aviation media.

It was one of the more exciting developments in the corridors of aerospace firms height, displaying an exacting control unprecoperating along the California coast. edented for a vehicle over 70 metres long with a The founder of Aeros Corp., CEO Igor Paspayload capacity of over 20 tons. \ ternak, has been developing airships for over 25 Upon arriving in Fiji, I realised the potential years. Since the launch of the DARPA-funded applications of Aeroscraft operations in the South WALRUS programme nearly a decade ago, the Pacific. support awarded for his company’s development of the Aeroscraft has evolved to redefine everyPotential for tourism thing an airship can accomplish.

Striking up correspondence with Pasternak As most people understand, the conventional and VP of Applications, Shenny Yao, I mentioned airship, commercial blimps used for advertisthe potential to offset fuel demands by deriving ing and broadcasting might come to mind, or energy using the ample surface area of the vehicle maybe images of the 1937 Hindenburg disaster, for a photovoltaic system, and we began discusin which the poorly designed zeppelin, coated sions regarding the practical uses of the craft in flammable metallic thermite and filled with throughout the region. highly volatile hydrogen for buoyancy, came to a Regional presence of even one of these aircraft spectacular and not unlikely demise. would allow for substantial development curMaterial limitations and dramatic design failrently impractical both with precarious docking ures of these early airships left an indelible impact and offloading of materials by sea, which, in most on the public consciousness and left commercial cases, additionally takes at least a full day of travel firms far less inclined to pursue research and between the islands. development of lighter-than-air travel.

Conversely, most air transport would facilitate The Aeroscraft ML866, however, is the result large-scale infrastructural needs due to payload of Pasternak’s enduring vision and years of work constraints for the aircraft small enough to actuby his brilliant team, and it sets an entirely new ally access the more remote regions in need of precedent for the field. material support.

36 Islands Business, November 2013

As in the event of instances in which partnership between domestic government and international organisations would provide resource allocation for the construction of infrastructural development, such as solar and wind power installations, or building materials and prefabricated structures for health centers on outer islands, employing an Aeroscraft would allow all necessary material to be unloaded directly on-site from above for immediate inventory and security.

To quote Pasternak’s statement to Leon Bettler of Gizmag leading into the final weeks of prototype development, “The aircraft is the vehicle that allows customers to make money.

“The advantage is you don’t need ground infrastructure. You can fly anywhere, you can land anywhere, you don’t need any ballast, you don’t need any ground crew.

“You can carry a lot of weight and at the same time, fly long distances. When you look at hybrid airships, they require a runway. The aircraft doesn’t need this, not a ground crew, not a runway, not the ballast.”

“It’s a complete transportation system. It does not need infrastructure.”

Running on a diesel engine with a range of 3,000 nautical miles at a cruising speed of 110 knots, energy efficiency is already besting that of other air transport by up to a third.

It also means commercial grade diesel fuel may be used, more readily generated and more efficiently consumed than aviation-grade jet fuels.

The craft itself settles into the US$40 million, which can stand in comparison to the US$200 million price tag attached to the Airbus A330s now flying over the Fiji islands under Fiji Airways branding.

Beyond logistical needs, adaptation of the Aeroscraft for luxury liner passenger cruises over the coming years will be made available contingent upon demand.

The potential ecological tourism benefits of Aeroscraft use throughout the islands are nearly boundless, especially once completely environmentally sustainable modes of thrust are implemented.

There are cruise ships docking regularly in Fiji’s ports throughout the year, subject to no regulatory jurisdiction or environmental impact assessment as they travel the nation’s sovereign waters.

The opportunity to expand high-value tourism economy would be supplemented tremendously by the addition of the Aeroscraft to the list of domestic attractions for foreign visitors.

The Aeroscraft team devised this vehicle to tackle precisely the type of logistical hurdles presented by the geography found throughout the South Pacific.

With increased awareness of the advances in infrastructural logistics, developmental bodies operating in Fiji and surrounding nations should be poised to take advantage of the opportunities these novel ideas introduce to both the economy and human environment.

• Andrew Irvin serves as a manager of operations & performance consultant for various telecommunications services throughout the South Pacific. He currently resides in Suva, Fiji. He can be contacted on andrew@onecubproductions.com

Health

The medicines are fake, the illnesses real

pharmaceutical regulation is weak or in rural undeveloped areas where there may be medicine shortages, are inevitably more vulnerable.

“Yes, fake medicines are already an issue,” a representative of the Council of Women in the rural Solomon Islands province Malaita told IPS. “Fake medicines for malaria and yaws are common. It is a particular concern for pregnant women.”

Malaita is the most populous province in a nation where there are 0.21 doctors and 0.11 pharmacists per 1,000 people and where the majority live at subsistence level in villages with irregular transport services.

There are no pharmaceutical manufacturers in Melanesia and access to imported medicines, even when free of charge, can be inhibited by difficult terrain, poor supply channels and insufficient health workers and funding.

Tema acknowledged that the country has experienced difficulties in procuring anti-malarial drugs such as coartem in the last two years.

East Asia is a major producer of the world’s supplies of malaria medicines and the source of 90 percent of active ingredients.

The UNODC reports that China was the origin of 60 percent of fraudulent medical products seized globally from 2008-2010.

The human cost of the illegal trade can include treatment failure, death and increased drug resistance to critical diseases.

While the Asia Pacific region has witnessed success over the past decade in reducing malaria cases and deaths by approximately 25 percent, it also has the world’s highest rates of anti-malarial drug resistance exacerbated by the circulation of fake medicines.

Solomon Islands...needs more public awareness on the lethal trade and its The vector-borne infection is tragic consequences. Photo: Mere Tuqiri a serious public health challenge across the western Pacific Islands, with pregnant women and children particularly at risk. well-established team to pick Tema acknowledged that “our pharmacy diviup the cases.” sion does not fully control drugs entering the In neighbouring Papua country, especially in the private sector,” and that New Guinea, a 2011 study of there was no drug registration. counterfeit and sub-standard He claimed that ties are being strengthened medicines by Goethe Univerbetween pharmaceutical authorities, customs and sity in Germany and the Unipolice, but legislation needed to be updated and versity of Papua New Guinea quality control improved. found that all 14 samples of the The difficulty in establishing the provenance antibiotic amoxicillin and antiof fraudulent medicines is compounded by the malarial drug amodiaquine known use by counterfeiters of Internet sales and taken from five registered free trade zones, where products can be re-packpharmacies in the capital Port aged or re-labelled, disguising their true origin.

Moresby were defective.

The International Medical Products AntiIngredients in such illegally Counterfeiting Taskforce (IMPACT), an initiareproduced medicines can tive of the World Health Organisation (WHO), include leaded road paint or recommends that nations improve equal access to chalk or shoe polish—and with and availability of quality medicines, strengthen no medicinal elements. legislation to establish pharmaceutical fraud as a No country is completely immune from the punishable crime, improve the capacity of regulaglobal trade in fake medicines which is estimated tory agencies to implement oversight of importaby health watchdogs to net international organtion, distribution and retail activities and expand ised criminals about $75 billion per year. public and media awareness of the issue.

Those on low incomes in environments where

The lethal trade and its tragic consequences

By Catherine Wilson INTER PRESS SERVICE NEWS AGENCY Reports of fraudulent medicines in the south-west Pacific islands states of Solomon Islands and Papua New Guinea have drawn attention to the need for more public awareness of the lethal trade and its tragic consequences.

Doreen (name changed) in the Solomon Islands, a nation of more than 900 islands and 550,000 people north-west of Fiji, had never encountered fake pharmaceutical products until five months ago when she bought a packet of anti-malarial doxycycline tablets over the counter at a city pharmacy.

There are 77 cases of malaria per 1,000 people in the Solomon Islands with approximately 40,000 infections every year. In neighbouring Papua New Guinea, the rate is as high as 179 per 1,000.

Doreen was told that the supply of green coloured capsules she was familiar with had run out when she questioned the mustard yellow tablets she was handed.

Within five days of taking them, Doreen knew something was wrong. Her kidney functions begin to fail and an acute internal blockage developed; symptoms she had never experienced before.

“It was terrifying,” she recounted to IPS (Inter Press Service News Agency), “I didn’t know what was happening or what was causing it. The pain in my lower back became excruciating.”

By the second week, she realised there was a connection with the medication and took the remaining tablets to a second pharmacy. They were found to be fake. Doreen was lucky she did not suffer permanent organ damage or worse.

The extent of fraudulent pharmaceuticals in the Melanesian islands is unknown, but the United Nations Office on Drugs and Crime (UNODC) has reported that 47 percent of anti-malarial medicines tested more widely in the South East Asian region are fake.

“Our office of regulatory affairs hasn’t received or collected any data of counterfeit anti-malarials entering the country, although a couple of months ago we received a WHO warning that counterfeit coartem (antimalarial) is on the market,” John Tema, senior pharmacist in the ministry of health and medical services in the Solomon Islands capital Honiara told IPS. He added: “We have no proper facilities or

The global trade in fake medicines is estimated to net international organised criminals about $75 billion per year.

Islands Business, November 2013 37

Health

Healthy Islands, Healthy people...SPC’s new approach to improving health in the region. Photo: SPC

Lifting our game in health SPC develops a new approach Pacific people’s health is generally good by global standards, but significant preventable premature deaths, disease and disabilities remain, and there are considerable health inequalities in and between Pacific Islands countries and territories (PICTs).

Progress is being made, but more needs to be done. For example, non-communicable diseases (NCDs) such as heart disease and diabetes present the most important public health challenge facing the region and threaten the way of life of Pacific people and the development potential of many PICTs. And in some PICTs, children suffer high levels of preventable diarrhoeal and respiratory diseases because of the environmental and socio-economic conditions they live in.

A new approach The Secretariat of the Pacific Community (SPC) has developed a new approach to improve health in the region. Healthy Islands—Healthy People is the new strategic plan of SPC’s Public Health Division (PHD) for the decade 2013– 2022. It outlines the vision, strategic direction, priorities and outcomes and how the division intends to achieve them.

In adjusting its public health focus, SPC has revised its approach away from a vertical, single disease and/or risk factor approach towards a focus on core public health functions based on its mandate, comparative advantages and avail38 Islands Business, November 2013

able resources.

It will concentrate on providing high quality evidence-based advice and support to PICTs in order to build, supplement and/or substitute public health capacity based on the best available evidence. Working with PICTs and development partners to strengthen core public health functions remains the priority.

SPC will continue to coordinate its public health work with that of the World Health Organisation and will continue to seek better delineation of the respective roles of the two organisations in the region.

The strategy is influenced by the ‘Healthy Islands’ vision produced by Pacific Ministers of Health in 1995 and responds to contemporary issues facing the health sector in the Pacific and developments outside the health sector that impact population health and well-being. The strategy also seeks to influence the post-2015 development agenda to ensure the unique needs of the region are recognised.

Investing in health In some PICTs, investment in health is well below the generally accepted threshold of 5% of GDP. National spending below this level makes it difficult to ensure universal coverage with basic health services on a consistent basis.

Pacific health systems are focused on costly curative services, despite changing disease pat-

terns and health care demands that require more effective public education, health promotion, disease prevention, screening and early treatment and greater use of community-based services.

Monitoring and evaluation of programmes are patchy and PICTs are less able to make informed decisions about the progress and impact of their interventions.

PICTs are expected to meet an ever rising set of health care demands while resources remain static or in decline. This means robust priority setting processes and close attention to aligning resources with health needs are essential.

Development partners and international organisations must also be more responsive to national needs.

The level of resources available for NCD prevention and control does not match the burden of disease caused by NCDs and related risk factors.

Poor health curtails personal potential and is a drain on prospects for national economic growth and development. Investment in individual and population health is an investment in personal, community and national development. Health needs to be more central in policy-making at national and regional levels.

Good health depends on factors beyond the health sector Good health is influenced more by factors beyond the health sector (food supply, housing, education) than by the provision of health care services per se. Important gains in health can be made by adopting pro-health policies, investing in health promotion and disease/injury prevention, increasing support and information for self-care, and ensuring consistent availability of primary health care services in urban zones, rural areas and outer islands. Interventions at secondary and tertiary levels (hospitals) tend to be more costly but benefit fewer people.

SPC is well placed with a unique mandate to work across several sectors that influence health, e.g. fisheries, agriculture, education and training, economic development and trade, supported by reliable and relevant statistics and information.

Moreover, it has a mandate from regional leaders to be the lead agency for health with direct access to Pacific Islands Forum Leaders where major social and economic policy decisions are made.

Better linkages between health and other sectors are needed with mutual accountability for results, and SPC is working to strengthen links between its health sector activities and the work of the Forum Secretariat in areas such as trade and economic policy.

As an international Pacific organisation, SPC has a number of distinct advantages that enable it to have a greater impact on health—not only through its direct public health support to PICTs, but also through helping them realise the health benefits of sound agricultural, fisheries and trade policies.

• Story courtesy of the Secretariat of the Pacific Community.

Education The women who have come through CETC over its 50 years came from different countries, different cultures and educational backgrounds. Several graduates have gone on to become highprofile leaders and advocates.

Nga Teao, a 1975 graduate from Cook Islands, became Director of the Gender and Development Division in the Ministry of Internal Affairs. Janet Kaltovei, a 1975 graduate from Vanuatu, managed the Women in Development Programme for the Foundation of the Peoples of the South Pacific.

Gradel Alfred, a 1977 graduate from the Marshall Islands, was the first female mayor for her island.

Saini Simona, a 1986 graduate from Tuvalu, became Director of the Department of Women’s Affairs.

Annette Mokia, a 2002 graduate from Niue, was Executive and Students of CETC..from 2014 USP will take over responsibility for administration and delivery of training. Photos: SPC Consular Officer with the New Zealand High Commission in Niue. Seletuta Pita, a 2003 graduate from Samoa, went on to become Assistant CEO of the Division of Youth.

Many graduates have set up programmes in their own countries, sharing their skills and knowledge – some as teachers, others as entrepreneurs setting up new enterprises, providing jobs, income and training in local communities.

Rereiti Tooma, a 1984 graduate from Kiribati, now employs more than 50 people in the Kiribati Garment Factory. When Tooma returned to Kiribati, she used her new skills to start a small business sewing and selling clothes, slowly expanding to take on and train staff. In the late 1990s, she By 2002, the focus was on leadership, manageFor 50 years, the Community Education went commercial, providing employment and ment and entrepreneurship. A Business DevelTraining Centre (CETC) in Narere, Fiji, has therefore an income for many households. opment Advisory Programme was established empowered hundreds of women who have gone Gertrude Andrias, a 1997 graduate from Papua for entrepreneurs and business support service on to make strong contributions to development.

New Guinea, set up a community women’s providers in response to private sector needs.

CETC was founded in 1963 as a programme resource centre similar to CETC. Her centre Since the early 2000s, more than 700 women of the South Pacific Commission, now the Secoffered courses in home economics, nutrition, and men have graduated from its business proretariat of the Pacific Community (SPC). It was agriculture and IT. Andrias is still working in gramme. Numerous small and founded with a vision of women this field, now as Principal of Kingku Hi-Tech micro-enterprises and business as agents of change at local, naTraining Institute in Jiwaka Province. development providers in tourtional and regional levels.

The impact of CETC in the Pacific is reflected ism, agribusiness and handicrafts, What began as a three-year in the stories of these women and many more like have benefitted from CETC’s project is now one of SPC’s them. But in 2013, after 50 years and 1700 gradupool of advisors. longest running programmes. ates, CETC will close its doors for the last time.

Never content to stand still, Over 1700 Pacific women have In 2012, an external review of SPC found under current head, Dr Lia Maka, graduated from its flagship course that the centre no longer fits within SPC’s CETC was the first institution in community development. Nutechnical and scientific work portfolio. After the based in Fiji to receive provisional merous other students, women completion of the final course in December 2013, provider accreditation from the and men, have taken its business CETC’s training programmes will transfer to the Fiji Higher Education Commiscourses.

University of the South Pacific (USP). sion, indicating compliance with A mainstay of the CETC proHigher-level elements of CETC’s Community the commission’s quality assurgramme for 50 years has been Development Programme will form part of a ance and qualification process. the practical experience students revised Diploma in Social and Community Work In 2012, a partnership with gain every year by facilitating at USP’s School of Social Sciences, while the SPC’s EU-funded Improving community development activivocational courses will become a new Certificate Agricultural Commodity Trade ties for women in communities in Applied Community Development for USP’s Dr Lia Maka...CETC head.

(IACT) project enabled businessthroughout Fiji.

Regional Centre of Community and Continuing es to develop and trial new food Since it began, the course has Education. products at CETC’s revamped constantly been adjusted to meet Both will be offered as distance and flexible food processing unit. The trials the changing needs of women. learning courses. CETC will continue to facililed to 15 viable products new to the Pacific food In its early years, in keeping with the times, the tate and advise on the transition until December production market. Based on local crops, the focus was on skills that would help women better 2013 when USP will take over responsibility for products—including gluten-free flours—have manage homes and families, as well as empoweradministration and delivery of the training. attracted huge interest from food producers and ing them to take on challenges and pass on new local communities. skills and knowledge.

• Story courtesy of the Secretariat of the Pacific Community.

Empowering women and supporting communities SPC’s CETC celebrates 50 years

Islands Business, November 2013 39

Business Intelligence

EU boat fined US$1m for illegally fishing in Nauru

Power woes for Pacific nations

By Robert Matau

T

he Nauru District Court has fined a European Union fishing vessel licensed to fish in Kiribati, US$1 million for illegally fishing in Nauru waters.

Albacora Uno, from Spain, was detected by the Pacific Islands Forum Fisheries Agency (FFA) surveillance systems in Honiara in the Solomon Islands in 2012 and the matter was relayed to the Nauruan Government through the FFA legal team with recommendations on the matter.

While the FFA was ready to report the ship to the Western Central Pacific Fisheries Commission to be blacklisted for IUU activities, it was up to the sovereign nation to decide which legal avenue it wished to take regarding the issue.

Nauru chose to deal with it in their own courts, thus the ship escaped blacklisting by the WCPFC, which would have banned the ship from fishing in the region plus hefty fines.

The purse seiner’s master, Jose Arrua Ispizua, and its fishing master, Sergio Iturraspe Iraculi, appeared in court charged with six counts of illegal fishing. They both pleaded guilty in the Nauru court.

The court was told that the crew believed they were fishing in Kiribati waters (EEZ) and not Nauru.

Passing judgment on the two defendants on September 30, Nauru Resident Magistrate Peter Law noted that the defendants admitted their responsibility to ensuring the accuracy of the equipment used to establish the location of the vessel.

However, he said tuna and other fish are valuable commodities which fishing companies exploit for profit through export to countries outside the Pacific region.

“In assessing the criminality of the defendants, the court notes that fishing is a scarce resource, which provides for the livelihood of a significant portion of the population of Nauru.

“The government of Nauru issues fishing licences to foreign vessels and receives significant fees from the licences.

“These fees are relied upon to contribute to the government’s budget and to enable the government to meet expenditure targets.

“The court notes the maximum fines which could be imposed for the six offences totalling US$1,600,000.”

FFA Deputy Director General Wes Norris described Illegal Unreported Unregulated Fishing as ‘the scourge of any fishery’.

“It robs developing coastal states like Nauru of valuable resources, reduces the value of legitimate fishing opportunities, compromises sustainability and obstructs fisheries development,” he said.

Unsatisfied with the outcome and how the vessel escaped the ultimate WCPFC blacklisting, Greenpeace has IUU blacklisted Albacora Uno. Greenpeace Pacific political advisor Seni Nabou says it seems like when you’re a big fish in the tuna industry, you can break whatever rules.

“Huge profits are at stake in the tuna fishery, but so is the future of a fish that is a vital source of food, livelihoods and income to small islands states,” she said.

40 Islands Business, November 2013

By Davendra Sharma

I

Guild argued that PNG with a population exceeding seven million and which accounts for 75.8% of the total electricity usage in the islands region—should get serious about exploring hydro generation options soon rather than rely on imported fossil fuels.

f today’s problem is shortage of electricity in the greater islands region of the Pacific with only 30% of the population having access, then tomorrow’s thorny issue will be affordability.

But there is hope that the two issues can be ironed out with new incentives to seek alternative So should Fiji and cheaper sources of electricity through such Though Fiji has invested heavily in hydro powabundant sources such as solar, hydro and wind. er, the region’s second most populous state with Islands leaders in the two most populous an ever-growing tourist infrastructure, is also not states—Papua New Guinea and Fiji—should be up to scratch with its investment in hydro power as wary of the critical issue as the bureaucrats in for the entire nation. smaller countries.

The ADB acknowledged that Fiji is endowed Electricity consumption has with hydro resources but yet it been steadily growing at a rate relied on imported fossil fuels to of 3.7% in the broader islands partly cater for its national elecregion over recent years but the tricity needs. demand for primary energy will It outlined that such dependouble from 3.6 tons in 2011 dence on imports means interto 8.8 tons in 2035. national price hikes catch the “Reliance on imported fuels island governments off guard for power generation hinders especially in the wake of recent development in the Pacific fluctuations during the global fiwhere electricity prices are nancial crisis which gripped the among the highest in the world major world economic powers and on average, around 30% since 2009. of households have electricity,” noted Robert Guild, director of Explore Solar, the transport, energy and natuwind and hydro ral resources division in Asian Through initiatives worth Development Bank’s (ADB) US$187 million, the ADB has Pacific department in his latest invested in alternative energy Energy Outlook report. source development projects in Government leaders were FEA technicians...at work. Photo: FEA the Cook Islands, Kiribati, Marnot serious about investing in shall Islands, Federated States alternative means of power—esof Micronesia (FSM), Nauru, pecially hydro which is readily Palau, Samoa, Solomon Islands, available in such larger states as PNG, Fiji and the Tonga and Vanuatu as none of the states have Solomon Islands. proven reserves of coal and gas.

Households are being forced to pay high usage Solomon Islands has heeded ADB’s call and bills in the impoverished states which rely on imbegun investing in hydro power, while the Cooks, ported fossil fuels because of the ever-fluctuating Samoa and Tonga have found successes in solar international prices. power development.

If such resource-poor nations cultivated in alPNG lagging in alternative means ternative renewable energy sources like FSM has Just as PNG Prime Minister Peter O’Neill done with wind power, then the islands states sounded an optimistic forecast for his nation’s would be able to open new doors and save much electrical power supplies in October with a new Isneeded import dollars. raeli company signing a contract to upgrade some In a 543-page, Energy Outlook for Asia and Paof PNG’s power networks over the next two years, cific, cautions that Asian countries will also face ADB was down-playing the country’s future outbig challenges in securing sufficient oil over the look for electricity grids.’ next two decades.

O’Neill signed a US$9.6 million deal with Is“The size of Asia and Pacific’s oil-import needs rael’s L R Group to upgrade all major transmisimplies that it might be a challenge to find and sion networks following frequent power failures secure stable and affordable oil supply sources exand shutdowns at the National Capital District ternally,” the bank noted. and surrounding areas.

To confront future energy demand, Asian and But the ADB criticised the administrative and Pacific countries would warrant a cumulative ininvestment processes which foreign investors envestment at home and abroad of US$11.7 trillion countered when dealing with the government hiin upstream energy extraction and production as erarchy in Port Moresby. well as energy distribution.

It particularly singled out PNG’s investment It said only China—boasting the world’s second processes that “enhance accountability and translargest economy—has actively turned to efficient parency of the investment process”. power-generation technology.

Small plane crash in tiny US island kills 3

By Haidee V. Eugenio

A

small commuter plane crash in the tiny island of Tinian in the Northern Mariana Islands on Oct. 6, 2013 claimed three lives and injured four others, the worst commercial aviation incident in this U.S. territory since at least the early ‘90s.

The U.S. National Transportation Safety Board and the Federal Aviation Administration have since been investigating the plane crash.

This happened only 11 months since another small plane crash involving the same airline—Star Marianas—killed one and injured six on Nov. 19, 2012.

The ill-fated Star Marianas Piper Cherokee Six aircraft crashed in a remote jungle, some four nautical miles off the West Tinian Airport on Oct. 6. It left the Tinian airport at 2:41am for Saipan, and was supposed to arrive on Saipan 10 to 15 minutes later.

CNMI authorities were alerted at almost 4am of an overdue Star Marianas aircraft. U.S. Coast Guard personnel from the neighboring U.S. territory of Guam also joined the search for the missing aircraft at the time, including a sweep of the ocean between Tinian and Saipan.

Authorities also searched the jungles of Tinian.

At 10:32am, or more than seven hours since the plane was due to arrive on Saipan, a U.S. Navy helicopter spotted the crash site.

Tinian emergency responders had to hike to the crash site to help rescue the four survivors.

Some two hours later, the four survivors were airlifted from Tinian and brought to the hospital on Saipan where they were treated for injuries, some of them included arm surgeries. The bodies of the three took longer to extract.

For two consecutive days prior to the Oct. 6, 2013 plane crash, Star Marianas also had two mishaps—one involved its smaller plane emergency landing on a street past the Tinian airport and the second one, a plane falling into a ditch after missing a turn while taxiing also at the Tinian airport.

Shaun Christian, executive vice president of Star Marianas, said his company is very sorry about the tragic loss.

“We are doing everything possible to assist the

victims and their families. We are also cooperating with the FAA and NTSB in investigating the cause of the accident and we are not at liberty to discuss the specifics of the accident at this time,” he said, as he also thanked CNMI and U.S. agencies that assisted.

China on close watch Within days, the Chinese government sent two of its consular officers based in Los Angeles, California, to the CNMI to assist the victims.

Of the three who perished in the plane crash, two were Chinese tourists.

The third fatality was the pilot, Luis Silva, originally from Mexico.

The four survivors are all Chinese tourists—including a three-year old girl whose mother was among the injured adults.

The child’s 29-year old father perished in the plane crash.

“Where’s mommy?” was the youngest survivor’s repeated question, in Chinese, within the first few hours at the hospital on Saipan.

The other Chinese fatality, a 26-year old, was on a honeymoon with her husband, who was also among those who survived.

“We’re very sorry to hear about the bad news that Chinese countrymen were badly injured in this accident, and two of our countrymen passed away,” Yu Xiong, consul from the Chinese Consulate General in Los Angeles, California, told CNMI reporters after a briefing with families of the victims who flew from China to the CNMI island of Saipan.

Within a week, all the survivors and the two of three bodies were sent back to China.

In the November 2012 Star Marianas plane crash, a female Chinese tourist also perished, while the pilot was badly injured.

FAA and NTSB investigation of the 2012 incident was not completed yet as of the Oct. 6, 2013 plane crash.

The visiting Chinese consul said the CNMI’s islands are beautiful but hoped that inter-island travel would be much safer than it is, given the two incidents.

A news crew from China Central Television from Hong Kong flew to Saipan to cover the accident.

Too many unanswered questions For days, the CNMI Office of Homeland Security and Emergency Management, the Commonwealth Ports Authority, the Commonwealth Healthcare Corp., the Marianas Visitors Authority, the Office of the Governor, the Department of Public Safety, and other agencies held news briefings for updates on the status of the victims and the investigation.

In one of those briefings, Marvin Seman, special adviser for Homeland Security and Emergency Management, said only when the U.S. agencies’ investigations are completed that a lot of questions can be answered, including what caused the plane crash or whether it could have been avoided.

What authorities were certain is that there is no indication that the plane crash was due to a deliberate act.

FBI special agent Tom Simon told CNMI media that the FBI’s only jurisdiction was to determine if the crash occurred because of a deliberate act.

“At this point, there is no indication that this is the case,” the FBI spokesperson said.

The FBI, along with the U.S. Coast Guard and CNMI authorities, helped preserve the evidence at the impact scene while they await the arrival of crash investigators from NTSB and the FAA. “It was gruesome,” said Tinian Mayor Ramon Dela Cruz, after reaching the crash site.

“It shakes you. I saw the bodies. I’ve never seen anything like that before. I pray for the families of those affected by what happened. I have also known the pilot Luis for quite some time.”

Tourism, safety CNMI tourism officials said it is still too early to tell whether the two plane crashes that killed and injured Chinese tourists would have a negative impact on arrivals from the Asian country.

The Tinian mayor also said with thousands of takeoffs and landings a month for the entire Star Marianas fleet, one major incident in 11 months is still a safe record.

CNMI Governor Eloy S. Inos, through press secretary Angel Demapan, said the administration can only hope that all airlines flying in and out of the Commonwealth strictly adhere to safety standards following the Oct. 6 crash.

Islands Business, November 2013

Environment

SPREP meeting in Samoa...environmental challenges facing the Pacific have grown over the years.Photos: SPREP

SPREP with David Sheppard

SPREP moving ahead

has played a key role in supporting the growth of T he environmental challenges facing services from SPREP to Pacific members.

Pacific countries have grown over the years, as The government of Samoa recently endorsed has the role of SPREP (Secretariat of the Pacific the development of the Pacific Climate Change Regional Environment Programme.

Centre at SPREP, acknowledging the role of SPREP supports Pacific countries and territoSPREP at the forefront of efforts to address ries to protect and better manage their environclimate change in the region. ments and ensure sustainable development for Prime Minister Tuilaepa Sailele Malielegaoi, in present and future generations. his keynote address to the SPREP meeting noted: To help achieve this, we will work in four key “I applaud the decision by SPREP members to areas: (i) biodiversity and ecosystem managedevelop the Pacific Climate Change Centre at ment; (ii) climate change; (iii) waste pollution SPREP. This centre will be a focus for and prevention; and (iv) environmental innovation and climate leadership in monitoring and governance. this region and in the world.

This year, we celebrated our 20th It has the full support of my governanniversary which provided an opment and we have sent this proposal portunity to review the achievements to the government of Japan with the of SPREP and to look to the future. strong endorsement of the government SPREP is fully accountable to its of Samoa.” members which includes 21 Pacific IsSPREP’s direct support to the Pacific lands countries and territories, through countries to address climate change was an annual Governing Council meeting. reported to the meeting. In particular, This year’s SPREP meeting was held in Apia in September, with 24 of our PM Tuilaepa Sailele the landmark Pacific Adaptation to Malielegaoi...applauds Climate Change (PACC) Project, 26 members attending. developed jointly between SPREP We were pleased to report to mem- climate centre. and the United Nations Developbers at this meeting that our direct ment Programme, is developing many practical financial and technical support to Pacific Islands programmes to address the impacts of climate members has more than doubled over the last few change in the Pacific in sectors such as water, food years. In particular, support has increased from security and coastal zone management.

US$2.4 million in 2010 to US$5.4 million in The Pacific Islands Forum Leaders Meeting 2012, while support for SPREP member regional held in the Republic of the Marshall Islands in level activities increased from US$6.8 million in September this year released a communiqué 2010 to US$8.3 million in 2012. which places strong emphasis on environmental The meeting noted that the overall SPREP issues, including invasive species and the manbudget has increased from US$7.6 million in agement and conservation of the Pacific Ocean.

2009 to US$22.1 million in 2014, reflecting Leaders highlighted climate change as the increasing confidence of donors and partners in greatest threat to the peoples of the Pacific and the work of SPREP. issued a statement on “Marshalling the Pacific Over this period, salary costs as a percentage of Response to Climate Change”. the total SPREP budget have dropped from 49% This high prominence reflects the fact that the in 2009 to 27% in 2013. The major increase in environment cannot be separated from sustainthe funding for SPREP has thus been mainly alable development and the livelihoods of people located to practical programmes in Pacific Islands in our region. This linkage has underlined the countries and territories. approach of SPREP since our beginning.

Samoa, the host of this year’s SPREP meeting, 42 Islands Business, November 2013

The SPREP meeting heard many examples of “natural solutions”—where the protection and more effective management of the environment provides a key frontline response to the effects of a changing climate. Our many efforts to protect and better manage biodiversity continue, a critical issue as our plant and animal species in the Pacific are being lost at an alarming rate.

This year, SPREP and its partners will convene the 9th Pacific Islands Conference on Nature Conservation and Protected Areas in Suva from December 2-6.

This conference, a significant event for biodiversity conservation in the Pacific region, has taken place every 4-5 years since 1975 and is the region’s premier event for biodiversity.

This conference will discuss a collective path forward for the next five years, working together to protect nature and ensure the livelihoods of Pacific people. The theme of this year’s conference is Natural Solutions—Building Resilience for a Changing Pacific This year’s SPREP meeting also looked to the future. 2014 will steer us towards an ambitious work programme with many new activities.

The government of Finland is supporting a programme that will enable SPREP to enhance technical support and advice to Pacific countries on meteorological services and climate change.

We also begin the Pacific Programme on Climate Resilience (PPCR) to strengthen the resilience of Pacific countries to climate change.

Next year will also see an expansion of SPREP’s work on waste management including a focus on hazardous waste and expansion of SPREP’s work on invasive species.

There will also be a major corporate review of SPREP in 2014, which will be combined with a review of the 2011-2015 Strategic Plan, our chart that helps us navigate our way forward.

2014 is also the year that Samoa will host the United Nations Small Islands Developing States Conference, providing a once in a lifetime opportunity for our Pacific region and SIDS. On behalf of our staff at SPREP, I would like to take this opportunity to thank you for your support and actions.

Our successes are your successes. At every step of the way in this journey, we work together with you and for you, to ensure a stronger, healthier and cleaner Pacific environment.

• David Sheppard is SPREP’s director-general based in Apia.

BSP Online Business Banking BILLPAY BULK PAYMENTS BANKING

FREEDOM

PAYROLL EasyPay SERVICE

AUTOMATED RECURRING PAYMENTS

WORLD CLASS

SECURITY

ONLINE BUSINESS BANKING

Enjoy world class banking security with eTokens available exclusively with BSP in Fiji.

Sign up today to access your business bank accounts from anywhere in the world.

www.bsp.com.fj

132 888 or +679 3214 300

THE TRUCK SPECIALISTS IN PNG The Brand NEW Ela Motors Badili Hino Truck Shop is now opened for business

OUR OURDEDICATION DEDICATIONCONTINUES CONTINUESAS ASWE WECELEBRATE CELEBRATE 50 50YEARS YEARSOF OFBUSINESS BUSINESSIN INPNG PNG Professional Process Hino Training Centre Dedicated Truck Lifts Purpose Built Workbays Hino Parts and Service Purpose Built Wash Bays State of the art Facilities

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