July 2013

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July 2013

Vol. 39, No. 7 V

Contents Tourism/Aviation

33 What affluent Chinese tourists want?

Exploring options to tap new market

34 Samoa tourism in crisis?

Operators suffering, bureau doing little

35 Oustanding issues to be thrashed out at ASPA Open skies study also to be tabled

36 Tax T relief, open skies deal with Singapore T TongaÕ s aviation on track

KALOSILÕS TOP PRIORITIES. Cover reportÑp Cover photo: Nic Maclellan

ages 14-16.

Cover Report

14 KalosilÕ s Agenda

New Vanuatu PMÕ s top priorities

Politics

17 Where are they now?

Arrest warrant for former CNMI governor, trial set for ex-AG

18 MSG aims Ô to restructure the P Pacific landscapeÕ

Summit supports Kanak and West Papua self-determination

21 T Tonga braces for tough times

Falling remittances, steep public debt plague nation

22 35 years on, where is the Solomons heading?

A nation on a downward spiral

23 Integrity bill back on the political agenda The way forward for the Solomons

25 Viewpoint Bountiful and beautiful Bougainville

Business

26 No EP EPA nor PACER?

37 Air Marshall faces difficult future

Can govt keep bailing out the airline?

38 Cutting costs and remaining profitable The tough juggling act

Fisheries

40 Ban commercial fishing: P PalauÕ s goal And use drones for enforcement

41 Close reserve to commercial fishing, scientists tell Kiribati It will ensure steady income for future

42 PNGÕ s #2 cannery holds big promises Majestic Seafoods set up in Lae

Technology

27 NewcrestÕ s crisis worries PM OÕ Neill

43 New tsunami computer model

28 EU gives Vanuatu, Fiji more time to address lax IUU laws

Environment

EPA talks stall, PACER Plus hit snag EP Could infect PNGÕ s economy

Make improvements or be blacklisted

29 PNG influence in Samoa

Lamana to build a US$50m hotel development

30 Snazzy domain names benefit facebook, google, visa ÉA

nd some small nations like Tuvalu

Business Prof ile

31 Fighting corruption in PNG Sam Koim on the front line

Health

32 Sexual health and wellbeing

Recasting response to HIV and other STIs

Helps Tonga handle disaster

44 Make each day a day to protect our oceans 45 P Pacific islandsÕ deadly threat from climate change

Regular Features

5 Letter from Suva 6 Views from Auckland 7 We Say 12 Whispers 46 Business Intelligence 48 RAMSI Update Islands Business, July 2013

Managing Director/Publisher Godfrey Scoullar Group Editor-in-Chief Laisa Taga Group Advertising & Marketing Manager Sharron Stretton Staff Writer Robert Matau Graphic Design Dick Lee Virendra Prasad Main Correspondents Australia Rowan Callick Nic Maclellan Davendra Sharma Fiji Samisoni P Pareti Dionisia Tabureguci French Polynesia Thibault Marais Marshall Islands Giff Johnson New Zealand Dev Nadkarni Jale Moala Ruci Salato-Farrell Duncan Wilson Niue Stafford Guest Papua New Guinea Baeau Tai P Sam Vulum Patrick Matbob P Peter Niesi Solomon Islands Evan Wasuka Alfred Sasako T Tonga Taina Kami-Enoka T V Vanuatu Bob Makin

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Column

parts of Asia and Africa, it does not necessarily mean that malnutrition does not exist around the region. It may not be visually obvious as in

BY DEV NADKARNI the case of Africa and Asia, but health indicators around the region indicate it is rampant.

Malnutrition is not necessarily the sole result of deprivation. By definition, malnutrition is the lack of proper nutrition, caused by not having enough to eat, not eating enough of the right things or being unable to use the food that one does eat. NGOs tend to concentrate on the first part of this definition—lack of proper nutrition caused by not having enough to eat. They seldom focus on malnutrition caused by not eating the right things.

This is exactly the Pacific’s problem: not desirable result.

A recent report on global child malnutrieating the right things; moving away from the Ultimately, it is political will and efficient tion* trains the spotlight on the parlous state of traditional wholesome diet and changing largely administration that determines the success of all affairs as regards the health of children and young sedentary lifestyles with little scope for exercise. human development programmes everywhere in mothers in most parts of the developing world.

This is also why the region is not mentioned the world. Child malnutrition is no exception.

While child malnutrition has been a subject in the report. The islands face a different kind When it comes to the fast growing economies of many studies over several decades, the focus of malnutrition—one caused not by the lack of like India and many other South Asian and South has generally been on health and wellbeing. New food but by plenty of food with little or no useful East Asian nations, the report makes for grim research as outlined in this report, however, nutrition value in it. reading. Their economic growth rates belie the shows its far-reaching consequences on a range The fact that the Pacific comprises one of the reality of the state of affairs that critical human of matters that go well beyond health to include world’s fattest regions is enough of a pointer development issues like child malnutrition find the quality of human resources, economic perthat something is seriously wrong with the themselves in. formance and the wealth of nations. region’s nutritional priorities. And the fact that Consider these facts, for instance: malnourthe incidence is growing means that youngsters No problems in the Pacific? ished children score seven percent lower in are beginning on the wrong footing. Empty caloI am not surprised that the Pacific, more math tests and are 19 percent less likely to be ries and high fatty content coming from highly specifically the Pacific islands region, finds no able to read at the age of eight years; poor health processed and packaged imported food have all and education limit job prospects but replaced the traditional diets of with childhood malnutrition cutting islanders—diets that helped them future earnings by at least 20 percent. adapt to their environment across Children with good nourishment the millennia. are 13% more likely to be in the corProcessed and packaged foods are rect grade at school, therefore boostvirtually devoid of micro-nutrients— ing life-long skills. extremely essential in early childhood The report investigates in great development. Micro-nutrients like depth the effect malnutrition has on metals and other trace elements cognitive development and educalike zinc, iron and magnesium are tion, and the overall effect this in essential in extremely tiny quantiturn has on economic outcomes in Nutrition campaign underway in Tonga schools...but more needs to be done. Photo: ties for a range of human metabolic the life of the child and its impact berwicklodge2tonga.global2. vic.edu.au activities including the way the brain on national development. The study and cognitive functions work. This is mention in this report. The idea of malnutriis exhaustive and multi-disciplinary offering a a fact that is highlighted by the new research— tion has for decades been purveyed by images number of perspectives on a global issue that which is backed by extensive scientific studies in of famished, rickety children, their rib cages has been largely seen as one related primarily to this latest report. So, although there is plenty of prominently showing, often pictured with their health and little beyond that. food in the Pacific and virtually no hunger, the siblings and mother living squalor around their According to estimates in this report that has wrongly imported kind, high in sugars and fat, living spaces. Poverty and hunger are concomitant been put together by the global NGO Save the has gained precedence over traditional diets and in such imagery. This report, like all others on Children, the current levels of childhood malthat is causing almost the same sort of malnutrithe subject, tends to reinforce these images of nutrition could cost the global economy $125 tion problems as in African and Asian nations. deprivation related malnutrition. billion when today’s children grow up. And the Most Pacific islands nations have embarked Although economic poverty is rife in the Pacost of fixing this gargantuan problem would be on nutrition awareness campaigns at the school cific islands region, it is quite different from the more than 100 times bigger than the funds and level but more needs to be done. Some nations poverty that people in sub-Saharan Africa and the resources needed to provide good nutrition to all have rightly clamped down on imports of suspect remote areas of Asia experience. For one, being of the world’s malnourished children. high calorie, high fat processed foods. But tighter blessed with abundant natural resources, hunger Once again, like most other problems that controls are needed. has never really been a concern in this region. weigh down human development programmes One hopes the study had included the Pacific One is unlikely to associate those heartaround the world, the issue is not necessarily one islands region in assaying school performance and rending images of naked hungry children—which of funding but rather of priorities. its relation to nutrition as a comparative study to NGOs are so fond of purveying to drive home For every dollar the countries of the world what was done in Asia and Africa. their point—with this region. spend on health, housing and education, they The NGO obviously thought that hunger But does that mean that child malnutrition spend seven on acquiring weapons and flexing and deprivation-driven malnutrition was more does not exist in the Pacific islands region? One their muscles against neighbours and adversarimportant than one that was caused by plenty of would wish that were indeed the case. Though ies. And whatever meagre funding is finally non-nutritious food. the report completely glosses over this region available for human development programmes, * “Food for thought—tackling child malnutrition to unlock because of its pre-occupation with malnutrition the manner in which this funding is disbursed potential and boost prosperity,” Save the Children, 2013. driven by deprivation as in the case of the poorer and projects implemented deliver a far less than

Views from Auckland

No hunger doesn’t mean no malnutrition

6 Islands Business, July 2013

WESAY ‘…as long as the highly debilitating mix of poverty, lack of education, information transparency and government corruption exist, the path for organisations that fight for people’s rights will always remain strewn with obstacles.

This is especially so because they are up against the financial might of global corporate giants in cahoots with some of the most powerful local politicians and leaders’

O

ver the past few years, the race for harvesting natural resources in Pacific islands nations, particularly in the Melanesian sub-region, has grown intense on the back of ever growing demand for minerals and oil from fast growing Asian economies.

Papua New Guinea has been ahead in the game with a slew of projects already operating and several others in the pipeline.

The Solomon Islands and Vanuatu have been comparatively more recent entrants in the race, although mining has existed in both countries for a long time and seem to have learned somewhat from PNG’s experience in the highly sensitive mining industry.

Civil society and environment groups in PNG have strenuously campaigned for greater transparency, education and information of local indigenous stakeholders and getting for them a fair go.

When that happens, it will give a legal recourse to people to set right similar situations whenever future licences are awarded without consulting them.

That will give them the legal handle to pressurise the government to cancel licences that have been awarded without consultation with communities. That would indeed be a laudable development, worthy of emulating throughout other Pacific legislatures.

But they have often found the situation loaded against them and their efforts to a great extent. This is because they are operating in an environment with low education and awareness of the issues involved, poor governance standards and a corrupt regime.

It is only in recent years that some progress has been made to bring local stakeholders and affected communities to the table or consultation on all aspects of mega-mining projects including present and future social and environmental impacts and the level of compensation they could hope to receive.

The government has also moved to enact legislation protecting their rights, modelled on similar laws enacted elsewhere in the world.

But as long as the highly debilitating mix of poverty, lack of education, information transparency and government corruption exist, the path for organisations that fight for people’s rights will always remain strewn with obstacles.

This is especially so because they are up against the financial might of global corporate giants in cahoots with some of the most powerful local politicians and leaders.

From recent developments, it is clear that countries like PNG,

Vanuatu and the Solomon Islands are poorly equipped to handle the rapidity with which foreign companies are setting up shop in these countries and rushing head-long into exploitation of their mineral resources.

While the imperatives for economic development and progress are vital and necessary, it is important not to lose sight of the potential downsides of rushing too fast into such activities.

Two events last month seek to highlight such developments.

On the one hand, Papua New Guinea’s environment activists and

Ralph Regenvanu (left) with Vanuatu chiefs...urging greater vigilance. Photo: Nic Maclellan

responsible civil society groups greatly praised the Vanuatu Government’s announcement that it would not allow experimental seabed mining in its territorial waters until the full environmental impacts are understood and there has been extensive consultation with citizens and civil society organisations.

They urged their own PNG government to take a leaf out of Vanuatu’s book and do the same in their own country.

On the other hand, similar groups in Vanuatu along with a couple of socially and environmentally conscious and responsible Members of Parliament as well as church groups have also raised the flag about the Vanuatu government having issued nearly 148 mining licences without any public consultation, in a cloak of secrecy as it were.

Ralph Regenvanu, Vanuatu’s minister of lands, geology and mines, revealed last month that successive lands ministers had issued these

The growing demands for minerals

Islands Business, July 2013 7

WESAY 148 licences for offshore exploration over the past five years.

He said only one of the licences was gazetted. Urging greater vigilance on the part of the government and the people, he added that no others should be issued without wide consultation.

He indicated there might be other grounds to put a stop to the other licences already issued, but if they were found to be legal, the country would have to honour them despite there being no consultation with the people.

The unseemly hurry in which so many licences were awarded without consultation and under a cloak of secrecy also points to potential corruption in the concerned ministries and in the affairs of elected representatives who are supposed to be in charge of running them. So while the Vanuatu Government’s announcement last month not to proceed with seabed mining licences until the full environmental impact was known is indeed laudable, as PNG activists have said, its previous actions are deeply suspect.

These two contradictory developments highlight the state of flux such matters are in, in Melanesian countries, notably PNG and Vanuatu: while on the one hand, we have a situation where a country is praising its neighbour for a wise policy announcement, on the other, people in that country are crying foul of that very government, accusing it of secrecy, lack of transparency and chicanery.

The need of the hour in these countries is education on these

matters for people at the grassroots level. It is ignorance at that level that allows their very own leaders to act brazenly, allowing foreign corporations to exploit resources within their indigenous territories while lining their own pockets.

This is an unfortunate fact of life in most of the developing world and the Pacific islands region is not exempt from it. The hope, however, springs from well informed, committed and nationalistic elected people’s representatives like Regenvanu. The Vanuatu minister, who blew the whistle on his own predecessors who had worked under a cloak of secrecy while awarding licences with no consultations whatsoever, went on record last month to say he would work towards a legislative remedy to prevent such brazen chicanery.

He told the media that the Vanuatu’s Council of Ministers had agreed to amend the constitution to make it mandatory for the National Council of Chiefs to be consulted on all bills relating to land or kastom before they go to parliament. The amendment will go before parliament in August.

When that happens, it will give a legal recourse to people to set right similar situations whenever future licences are awarded without consulting them. That will give them the legal handle to pressurise the government to cancel licences that have been awarded without consultation. That would indeed be a laudable development, worthy of emulating throughout other Pacific legislatures.

‘Australia and New Zealand have effectively failed to leverage this increased aid to engage more meaningfully with the Fijian government to the greater advantage of all, not least the Fijian people. Their stance smacks of political and diplomatic naivety’

A

n article saying that Australia and perhaps New Zealand have played an active role in influencing a continuing ban on lending to Fiji by international financial institutions received much coverage in the regional media and the blogosphere.

It suggested the two ANZAC nations used their influence on organisations like the World Bank and Asian Development Bank to stymie financial assistance to the Fiji Government after 2006. But while continuing to influence these two large institutional banks, Australia stepped up its own development assistance to Fiji, the article noted, accusing the Australian establishment of hypocrisy.

Expectedly, both sides of the Fijian divide furiously commented on the article while the financial institutions and Australian Government sources issued the customary denials in customary bureaucratese, putting their practiced skills of saying much without saying anything to effective use.

The institutions denied they were influenced by politics in decision making related to lending to governments but the language that was used in communications around not being able to lend to Fiji since 2006 hints at exactly the opposite.

8 Islands Business, July 2013

Australia has clarified its boosting of development assistance as being aimed at projects benefiting the people directly as against lending to the Fijian Government to implement any development schemes.

The denials appear strenuous. Though they seem to have softened their public stance on Fiji over time, there is no doubt that the ANZAC nations were vehement in their criticism in the early years following 2006 and worked actively to campaign worldwide to treat Fiji as a pariah.

For instance, they tried to influence the United Nations to drop Fiji as a supplier of personnel for peacekeeping forces in the world’s trouble spots. But their clamour went unheeded. They canvassed the European Community, again with limited success. They have also opposed Fiji’s participation in regional trade deliberations like PACER Plus. They refrained from engaging with the Fiji regime in the crucial early years after December 2006, pursuing a rudderless isolationist tack that bore no fruit and resulted in forcing Fiji to look north.

It is this deepening engagement with the north, notably China, that ultimately got them worried enough to change that stringently uncompromising isolationist tack of the earlier years.

WESAY In recent years, both Australia and New Zealand, although not keen on saying specifically they have softened their school masterly stance on Fiji, have increased their engagement with the country at several levels. Increased development assistance, which is referred to in the said article, is one of them.

The article’s allusion to Australia’s hypocrisy is somewhat misplaced. The hypocrisy is not that it is not stymieing the Fiji Government’s access to international funding agencies for loans while scaling up direct development assistance. Rather, the hypocrisy is about hiding their mounting worry about the consequences they now face with their stringent isolationist strategy of the immediate years following 2006.

As well as deeper engagement with China, which has undoubtedly worried them, the Americans have also stepped up pressure on the ANZAC nations to relook at their Fiji policy in light of China’s growing geopolitical muscle in the region. Everyone knows that Fiji is the pivot of geopolitical influence in the region. And the ANZAC nations’ isolationist policy has driven Fiji straight into the waiting arms of the Chinese.

For instance, a World Bank infrastructure loan that was close to finalisation just before December 2006 has been held in abeyance ever since, affecting a crucial water supply project. But the Chinese government stepped in and duly helped complete the project with a soft loan.

The Chinese government has thereafter assisted by providing financing for a number of other infrastructure projects such as roads and ports around the country including on other islands.

Australia and New Zealand have effectively failed to leverage this increased aid to engage more meaningfully with the Fiji Govern-

Political and diplomatic naivety

ment to the greater advantage of all, not least the Fijian people.

Their stance smacks of political and diplomatic naivety. They seem to have concluded that helping people with aid while denying the government with vital loans somehow vindicates their stand of opposing the December 2006 event and the present state of affairs.

It is incredible that the boffins in Canberra and Wellington could not have figured out that whatever aid that lands in Fiji and helps development, ultimately is credited to the government by the people, thereby making the government look good anyway.

Such befuddled thinking accompanied by the looming fear of the growing Chinese influence in the region and their unwitting part in abetting it as well as pressure from the United States to toe its own line on conciliation on the Fiji issue in the interests of regional geopolitical rebalancing has further confused policymaking.

On their part, the big financial institutions accused in the article of complying with the wishes of the ANZAC nations in denying financial assistance to the Fiji Government have expectedly denied such a thing happened.

Their denial is enveloped in clever, circumlocutory corporate speak. But it is a little more than the proverbial fig leaf.

In view of the steps the Fiji Government is taking towards elections on September 14—under the watchful gaze of the international community—it is time these institutions and their board member countries revise their duplicitous policy that has led them nowhere so far. Fiji is too geopolitically critical to remain friendless for too long.

The manner in which China and the Asian nations have rushed in to fill the vacuum left by the ANZAC nations post-2006 is testimony to this. Australia and New Zealand have undoubtedly realised this. It is time they acknowledged it—they won’t publicly. But they can do so by stopping any negative campaigning behind the scenes.

‘The beacon of the free world that has long championed the cause of individual freedom, personal choice and privacy has been exposed as one of the most controlling of regimes when it comes to information and communications. The revelation of the level of private and corporate snooping could well put to shame the cloak and dagger practices rampant in countries behind the erstwhile iron curtain of communist era nations’

B

leeding heart champions of privacy who have turned on their faceless government employers have now confirmed the most feared nightmare in our networked world. The Orwellian Big Brother is not only watching but also listening, viewing, reading

and perhaps saving everything you say, do, view, listen to, search for, write, eat, drink and much else to an inexhaustible stack of hard drives in secret locations that can be retrieved by authorised minions with impunity.

Last month, a contractor of the highly secretive United States’ Islands Business, July 2013 9

WESAY National Security Agency abandoned his job and flew half way to explain and justify such levels of surveillance on common folk and across the world ensconcing himself in Hong Kong. There, he the very need to pry on such a massive scale. It looks as though it is revealed to the world that the United States administration had being done simply because the technology to do so is available and secret programmes that tapped, intercepted, collected and secretly the government has the power and money to do so. Undoubtedly, copied a range of private information of not just millions of its own though, no government can claim the moral justification to pry so citizens but also of corporations, foreign nationals and people and surreptitiously on its own citizens on such a scale. companies from countries around the world.

Closely on the heels of the American revelations, the United There have been people who have worked in highly sensitive Kingdom and several other nations have claimed that their own posts in their governments who have turned against their employgovernments as well as the United States’ secret service agencies ers and their very countries, so to speak, in going public about how have been listening in on their own people’s communications and governments wield the power to potentially control people’s lives affairs. Civil rights activists in India, New Zealand and the United by accessing information that is supposed to be intensely personal Kingdom, to name only a few, are up in arms and demanding to and therefore private, many a know more on what has time deemed so by law. been going on.

Apparently, they have had Irrespective of how the an epiphany of sorts and with current imbroglio pans out a big change of heart and for the American governwhat could be a great risk ment, the fact remains that to their future prospects of modern communications being employed anywhere, technology, like all useful thought it best to reveal to technologies before it and the world how bad a governsince, is the proverbial sword ment can be, once it has the with two edges. Their expower to what it has to do, treme convenience, instant which it ironically draws reachability anywhere in the from the people. world irrespective of time The concerned governand distance and plummetments, while they have been ing costs of staying concaught completely off guard nected are indeed magical and with no precedent to qualities.

President Obama...is his administration snooping on its citizens and corporations? Photo: fitsnews.com deal with such eventualities, But the downside is the have reacted incoherently, relative ease with which trying to apply every rule in such communications can the book to rein in their “errant” former employees and contractors. be compromised, as has been shown by those who have chosen to This has forced these whistleblowers into the waiting arms of blow the whistle. rival governments or unfriendly ones that have no extradition or Governments’ role in surveillance has long been suspected, repatriation treaties, effectively putting them out of reach of the speculated and talked about. But this is the first time an insider has governments of nations where they are wanted. We have seen a revealed details of the extent to which governments are prepared recurring theme in such events as they have unfolded in recent to go to. months. The country that has been hardest hit with allegations of Also, it is unlikely that administrations would ever have the time institutionalised snooping on its own citizens is the United States and human resources to go through each and every bit of comof America. munications data generated by each and every individual with a The beacon of the free world that has long championed the fine tooth comb. That would be impossible. The brouhaha, then, cause of individual freedom, personal choice and privacy has been is more about the principle than anything else. exposed as one of the most controlling of regimes when it comes Democratic governments proudly tout the individual freedom to information and communications. The revelation of the level of that they guarantee but there is no telling to what extent power private and corporate snooping could well put to shame the cloak hungry politicians and their faceless, gargantuan regimes will go and dagger practices rampant in countries behind the erstwhile iron to merely to get what they want, even if it means throwing the law curtain of communist era nations. books to the winds—all in the name of national security and public safety. But would these very same governments guarantee that this For politicians, whipping the bogey of threats increased surveillance will bring down acts of terrorism to zero or Private and to national security and the safety of the greater at least to a minimum? Fat chance. Terrorists will still strike and corporate good are a convenient handle to bend any existlater investigations will reveal, as they have in so many instances in snooping ing law that might guarantee basic freedoms for the past including the recent Boston bombings, that the suspects people. In this case, an increase in terrorist activiwere under surveillance but still managed to strike. ties around the world, and more particularly in the United States, This sordid episode is another modern day instance of the old has been touted as the reason for increased surveillance on all sorts adage ‘Power corrupts, absolute power corrupts absolutely’. Terrorof communications. While there is a valid point on the importance ism and national security are today’s tools that governments wield that such matters must be accorded, the level of surveillance that to access and exercise absolute power. has been revealed, if proven to be true, is unjustifiable.

• We Say is compiled and edited by Laisa Taga.

In the United States, the Obama Administration will be hard put 10 Islands Business, July 2013

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Whispers Protocol dramas: There were a few protocol dramas at the Melanesian Spearhead Group summit in New Caledonia last month. Members of Indonesia’s observer delegation travelled uninvited to the offshore island where MSG leaders were holding their retreat, causing some anxiety for officials and French security officers. One leader was unimpressed when told about the Indonesians and he reacted with anger saying: “what else do the Indonesians want.” Retreats are normally attended only by MSG members—and like the Forum Leaders retreat—each member is only allowed two reps—one leader and one official.

sel Day Scheme. A Pacific source in Brussels said: “We have done all we could to respond to their technical questions. The EC seems to be suggesting that we must make changes to the VDS, hence our national laws, before we conclude the EPA. We told them the EPA is a trade agreement, not a fisheries agreement. The VDS is implemented by eight PNA countries and any attempt to change it should be discussed with them at the relevant fora but not in the EPA.” Well, it appears the EU officials the Pacific negotiators are talking to are not really committed to concluding EPA negotiations by the end of this year. 

 Still on the MSG summit...which of the MSG leaders refused to fly by helicopter to the retreat island, with organisers rearranging travel by the more familiar boat? Answer? Well, someone with a lot of naval experience.  MPs pay: Who says politicians in Solomon Islands are amongst the poorly paid and have access to little or no extra funding at all? Consider this. This year alone, the 50 national politicians have a combined discretionary fund totalling SB$300 million (about AU$44 million), equally shared by the constituencies. That’s besides their annual salaries, which range between SB$111,000 and SB$164,000. But that’s not all. Questions are being asked as to whether national pollies have access to other source(s) of income. For example, Whispers has been reliably told that one leading politician has in his personal bank account in Honiara more than SB$50 million (about AU$7.25 million) in today’s exchange rate. The polly has strong affiliates in the lucrative logging industries.”  And still on the Solomons…the latest gossip is that an expatriate businessman was rushed to the airport recently to be deported only to be told the airline needed 48 hours notice before it uplifts a passenger with person non-grata status.

Well, nothing more has been heard about the expatriate businessman. But Whispers understands, he is still in Honiara. He and his family have been living in Mendana Hotel and then moved to the Heritage, since it was opened a couple of years now.  EPA drama: The Europeans are at it again.

While PACP countries came to Brussels late last month ready to negotiate, the EC was obviously not ready for that. What they were ready for was a question and answer session on our conservation and management measures, particularly the Ves12 Islands Business, July 2013

An MSG stock exchange? Guess what, stock enthusiast! The MSG trade bloc is toying with the idea of having its own stock exchange.

This is consistent with its push for free trade and free skills movement across MSG borders.

Its own stock exchange is coming with the idea that it now wants free movement of capital across its borders. The good news is there are already two such facilities—the Port Moresby Stock Exchange (POMSoX) in Papua New Guinea and the South Pacific Stock Exchange (SPSE) in Fiji.

What we wait to see now is how they will do this to accommodate companies in the rest of MSG, which are Vanuatu and Solomon Islands. Will they merge POMSoX and SPSE? Dual listing perhaps? Or a third stock exchange specifically to cater for companies in the four MSG member countries—PNG, Fiji, Solomons and Vanuatu?

Stay tuned to this magazine for the details on that.  PIFS’ PR adviser: Has the Pacific Islands Forum Secretariat (PIFS) appointed its PR Adviser yet? Well, word from Muanikau in Fiji where the secretariat is located, is that PIFS is yet to appoint a PR Adviser. However, the newly appointed Communications Officer has gone on maternity leave, not long after she started work.  Air Niugini’s new boss: Air Niugini’s new CEO, Simon Foo, could be attending his first ASPA meeting when it meets in Nadi in the middle of this month. Foo recently became acting CEO after Sri Lankan Wasantha Kumarasiri was appointed managing director of the Independent Public Business Corporation (IPBC), which oversees the operations of state-owned entities such as Air Niugini. Foo’s announcement as CEO was made by Air Niugini board chairman Garth McIlwain.“Foo is well qualified for this role having worked as a senior executive with Air Niugini for 25 years,” he said. “He is particularly experienced in the areas of the national airline’s operation and commercial activities where considerable challenges emanating from rapid growth in recent years exists.” Foo was also a director of

the airline for 10 years. Not only that, Foo is also involved in tourism, owning a hotel in Kokopo.  Talking about airlines…could Fiji Airways (formerly Air Pacific) be making an announcement soon regarding their new CEO, to replace American David Pflieger? Well, there’s been a lot rumours circulating regarding Pflieger’s replacement. But Whispers hears through the grapevine that the airline board has already appointed one who has vast experience in the airline industry having worked for airlines such as Lufthansa and Virgin. He is apparently coming from Kuwait from Jazeera Airways, a publicly listed airline on the Kuwait Stock Exchange. He has been credited with turning the airline around to sustainable profitability. And guess what, we hear he is a former international marathon runner and has been to Fiji more than once including visiting Kadavu for a diving trip.  Still on Fiji’s national airline…one of the things he will have to address is the high turnover of its staff. Pilots and engineers have been leaving the airline moving to greener pastures in the United Arab Emirates and to nearby Papua New Guinea. The latest batch to move are cabin crew members (flight attendants). Whispers hears more than 30 are moving across to Air Niugini.

And it won’t be just Fiji Airways cabin crew flying for Air Niugini. The PNG national airline has also recruited from other countries including the Philippines.  Miss Samoa who? Well, Samoans got a shock…after a 20-year absence from the Miss World contest, they’re told they’re back and will be competing in this year’s Miss World Pageant, so say the organisers of the Miss Samoa World pageant. Four young women competed in Apia to find a world rep—two live in New Zealand and the other two in Australia. Many asked why they’ve come back to Samoa to host the Miss Samoa World—the obvious answer was that the criteria to enter Miss World needed a competition to be hosted in the country of representation.

Representing Samoa in Indonesia in September is Penina Marie Pa’eu, the current Miss Samoa New Zealand. She will be among more than 130 contestants vying for the Miss World title. Controversy over the pageant has been mounting in Indonesia, which has a reputation as a tolerant, pluralist society that respects freedom of expression. “That contest is just an excuse to show women’s body parts that should remain covered,” said Mukri Aji, a prominent cleric from West Java province’s MUI branch. “It’s against Islamic teachings.” Most Muslims in Indonesia, a secular country of 240 million people, are moderate, but

Whispers

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New ‘Island Airbus’ for resorts Fiji tour operator, Pacific Island Air, recently took delivery of its new De Havilland DHC-3T Otter seaplane, visiting Castaway Island Resort to pick up its first customers. Fitted with the latest GPS system and intercabin communication headsets for each passenger, the 10-seater plane now offers a modern, fast and more comfortable transfer option to the island resorts. Young passengers Liam and Luca Gasmus from Sydney were thrilled to be the first to board the inaugural flight from the popular island resort. Resort staff have affectionately nicknamed the seaplane the “Island Airbus”. a small extremist fringe has become more vocal in recent years. They have pushed through controversial laws— including an anti-pornography bill.

Lady Gaga was forced to cancel her sold-out concert in Indonesia last May following threats

by Islamic hard-liners, who called her a “devil worshipper”. Jennifer Lopez toned down her sexy outfits and dance moves during a show in Jakarta last December.  New head for OCO? Could the Oceania Customs Organisation Secretariat be head-hunting for a new head honcho following the drama over certain expenses accrued by the secretariat? Well, Whispers has been told that at the OCO 15th conference in Tonga last April members raised concerns over certain expenses by the secretariat.

As evident in the 2012 OCO annual report, the organisation had obviously run riot with a certain “personnel cost”. OCO amazingly spent, without so much of an explanatory note, F$1.54 million on “personnel cost” alone. That’s 70.7% of total income and 65% of total expenditure focused on that cost alone. In 2011, “personnel cost” again drummed up an incredible F$1.78 million against a total expenditure of F$2.6 million (67%) and total income of F$3.01 million (59.2%). The secretariat only spent F$410,067 on meetings and workshops and F$395,152 on general administration. Members apparently asked OCO for an explanation about the personnel costs.

However, members have endorsed the formation of a committee to begin recruitment of a ‘new’

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head of the secretariat.  Kava debate: New Vanuatu Prime Minister Moana Caracasses Kalosil made quite a revelation when he was interviewed by this magazine recently about Vanuatu kava and Fiji. Here’s what he said: “The funny thing is people in Fiji are taking our kava and exporting it as ‘Made in Fiji’ label. I think seriously we need to be more open in our discussions to have systems in place, otherwise Vanuatu does not benefit from this trade.”  Diplomatic passports: And if you’re looking for a diplomatic passport from Vanuatu, well, the Kalosil government is tightening that up. No Tom, Dick and Henry or non citizens can now be able to acquire one. Vanuatu, according to Kalosil is amending the legislation governing passports.

It is understood the amendment will go before parliament this month. If it gets the nod, this means that non citizens cannot hold a diplomatic passport…one has to be a Vanuatu citizen in order to qualify. This will stop the sale of Vanuatu diplomatic passports. “We have 187 diplomatic passports that were, well I would not say sold, but were given away and I have charged the Deputy PM and Minister of Foreign Affairs to look into the matter,” he told this magazine.

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Islands Business, July 2013 13

Cover Report

Happy to lead Vanuatu? New Prime Minister Moana Carcasses Kalosil. Photo: Fiji’s Ministry of Information

KALOSIL’S AG New Vanuatu PM’s top priorities 14 Islands Business, July 2013

W

ENDA

By Samisoni Pareti

est Papua’s struggle for independence has found a supporter in Vanuatu’s newest Prime Minister Moana Carcasses Kalosil.

The Tahitian-born politician but naturalised Vanuatu citizen not only pushed to get the Indonesian province to be admitted as a member of the powerful Melanesian Spearhead Group (MSG), he also directed his deputy and foreign minister Edward Natapei to review the aid assistance agreement his predecessor entered into with Indonesia.

If he has his way, Kalosil would not be buying time by calling for a review of that agreement; he would have canned it on his first day in office.

In an interview with Islands Business on a recent visit to Fiji, the Vanuatu leader admitted he runs a coalition government and would need to be mindful of the views of the other groups that make up his cabinet.

“Indonesia is a big, powerful country that can help our economy,” said Kalosil. “I’m saying as Prime Minister, I want this issue of West Papua to be heard.

“I want them to be part of MSG, to be members, and I am going to try to make sure they do become members because it is important for us.”

Kalosil didn’t get his way at last month’s Melanesian Spearhead Group (MSG) meeting in New Caledonia however.

Leaders of Papua New Guinea, Solomon Islands, the FLNKS of New Caledonia and Fiji opted to defer any decision on West Papua’s membership until a MSG delegation of Foreign Ministers visited Jakarta and West Papua at the invitation of the Indonesian Government.

Support for the West Papuans who are seeking independence from Indonesia is part of Kalosil’s 100-day plan in office.

“Declaration of support for full membership of MSG for West Papua” was number 32 on the list of 68 things he wanted his Council of Ministers to implement before his 100 days in office is up.

Excluding weekends, those days will be up by September.

Kalosil spoke strongly of his support for West Papua when he flew into Fiji in May to attend a special session of the Group of 77 plus China.

“Vanuatu stands firmly behind the struggle of West Papua and we all know that the founder of Vanuatu, the late Father Walter Lini, stood up very strongly on this matter with other leaders. I am just continuing that struggle.

“For the last 20 years, I have been an advocate and very strongly behind the struggle of West Papua.

“I have been travelling the world a lot, I paid my own ticket to promote and speak out on the issue of West Papua.

“I have nothing against Indonesia, no, no. I have a lot of Indonesian friends, and I like them very much.

“But I believe someone has to speak up about human right issues over there. This is something we cannot turn a blind eye to. I mean they are part of our brotherhood.”

Kalosil sounds optimistic but he knows the stakes are high.

His country has already entered into a bilateral aid assistance agreement with Indonesia, which is already enjoying observer status within the MSG. PNG, the leading MSG member, has always been reluctant to back the West Papua cause because of its policy of keeping peace with its neighbour, Indonesia.

Fiji is likely to take its cue from Waigani.

Very mindful that he took office last March on the back of the support of a loose coalition of other political groupings in addition to his own Green Party, Kalosil seems to have a strategy on how to keep his coalition and government intact.

“I am writing a letter to all political parties so that we could sit and Islands Business, July 2013 15

Cover Report discuss frankly the future, to shape the political future of Vanuatu and strengthen stability.

“Some say we should take the model of PNG to introduce an integrity bill.

“The problem is that our constitution does not permit that. We have in our constitution the freedom of movement and choice, and that is paramount.

“You can’t stop anyone moving from here to there. It’s the same for a member of parliament. If he is elected from this political party and decides to move to the other group, we can’t do anything about it.”

So does he feel his government is going to last, or will it suffer the same fate as those before him?

“Many times a prime minister will form a government promising a few things. But when he doesn’t deliver, this is the time backbenchers will move. I don’t make promises. I have a reputation for yes means a yes, and no is a no.”

The Vanuatu leader touched on a wide range of matters in the interview with Islands Business and they include:

• MSG Trade

“The trade agreement is good but we need Vanuatu to benefit more from it and I’m working on it. Unfortunately, we don’t have much to export.

“We have organic beef...this is something we are negotiating with the Fiji Government and how we can get our private sector to promote our beef industry in Fiji. So this is something we can share. And vice versa. I have had a meeting with Fijian businessmen to promote doing business in Vanuatu.

“We want to see how we can help each other in trade.”

ism. We need to open up far-flung provinces like Torba to tourism, so we have decided to upgrade the airport over there to take ATR 72 planes.”

• G77

“I must say the north has given us their way of life where success is based on money. Now the question is, ‘do we in the south want to follow that way of life?’

“We can see today that the world is suffering because of that model; do we need $1 billion in our bank accounts, is that the way of life we want?

“Do we need 20 trucks? Do we need 10 houses?”

• Government Stability

“The challenge for any prime minister is to keep stability and support. Many prime ministers have tried through dialogue to put a system in place that revises/changes the voting system in parliament. So may be our voting system is not a true representative of the voters. May be this is something we should look into.”

• Holding Council of Ministers’ Meeting in the Provinces

“What happened at that first (cabinet) meeting was that we interacted with the people. We had the chance to listen to women leaders, youth leaders, chief leaders and church leaders to discuss issues directly with members of my cabinet, interact with us and tell us what they want from their government. Not only that, we brought donors to become part of the interactive discussions, and the private sector as well. I told the Chamber of Commerce that I wanted them to be there. ‘We want to work with you because you are the ones who are going to tell us what sort of policies that will grow the economy.”

• Diplomatic Appointments

“I want an audit of each of our missions. There was also a law that was amended called the Passport Act. It was amended in 2011.

It allowed non-citizens to hold diplomatic passports of Vanuatu.

We will amend that in July so that non-citizens cannot hold a diplomatic passport. One has to be a citizen of Vanuatu in order to qualify. This will stop the sale of Vanuatu diplomatic passports.

We have 187 diplomatic passports that were, well I would not say • Kava sold, but were given away and I “The funny thing is people have charged the Deputy PM and in Fiji are taking our kava and West Papuan campaigners...Rex Rumakiek (left) and John Ondawame. Photo: Nic Maclellan Minister of Foreign Affairs to look exporting it as ‘Made in Fiji’ label. into the matter and come back I think seriously we need to be with some propositions about more open in our discussions, to how we can develop further missions abroad in have systems in place. Otherwise Vanuatu does • Climate Change a way that respect international law and our own not benefit from this trade agreement. But we “We can’t change climate. When I was on the laws in Vanuatu.” will find solutions. There are always solutions. island of Torba, that’s a province in the remote There’s the saying that there are many ways north of our country, a chief told me, ‘You see • Illegal sale to skin a cat, so we have to find ways in which Prime Minister, my house was over there 20 years of public land Vanuatu can benefit too.” ago.’ Pointing to the sea, some 800 metres. ‘Please “First ,we are doing a stock-take of public sales do something about it.’ I couldn’t answer him. I that were done since 2010. I was in government didn’t have any answer. And that’s the challenge • Economic Participation then and I remembered that the Council of Minwe in the Pacific are facing at the moment.” of ni-Vanuatu isters had directed that no public land should be “What we are promoting now is partnership sold to anyone without the prior consent of the • West Papua with ni-Vanuatu. I can say for 23 years, ni-Vanuatu Council of Ministers. But in spite of that directive, “We should really speak out and do something were mere spectators in the economy of Vanuatu. the Minister for Land then continued to sell public about it. It’s like you watch TV and you watch Now we want them to be actors, to be part of the land. We believe these sales were illegal and we people suffering and being killed, and you sit economy. That is a part of my government’s 100have charged our new minister of land to inform there, eating and just say ‘oh la la.’ day plan. We want to impose in some sectors the these people that they can voluntary return these “That’s not good if you don’t do any51% ownership rule by ni-Vanuatu.” lands, we will reimburse their money, or they will thing about it. It’s become so common to face the consequence by taking them to court. And see on TV that people are suffering that • Tourism Investments we will not only institute civil proceedings but we don’t care. Well, Vanuatu does care.

“Forty percent of our GDP comes from tourcriminal charges as well.”

16 Islands Business, July 2013

Northern MarianaS

Where are they now?

Arrest warrant for former CNMI governor, trial set for ex-AG warrant in connection with the alleged conspiracy case surrounding Buckingham’s “exit” from the A judge reissued an arrest warCNMI, despite being served a penal summons. rant for former Commonwealth The penal summons served on Buckingham of the Northern Mariana Islands were in connection with almost the same is(CNMI) Governor Benigno R. Fitial on June sues hurled against Fitial in two impeachment 20, barely weeks after former CNMI attorney resolutions filed against him, including a no-bid general Edward Buckingham “cured” his fugiUS$190.8 million diesel power purchase agreetive from justice status and is set to face trial in ment for 25 years with Saipan Development LLC, February 2014. a sole-source ARRA management contract award, Fitial resigned as CNMI governor on Feb. 20, and violation of election laws when Buckingham 2013 or days before the start of his impeachment allegedly hosted a political campaign for the govtrial at the Senate. He is facing seven criminal ernor’s delegate candidate in 2010. charges for his role in an alleged conspiracy to Fitial’s impeachment issues, meanwhile, also shield Buckingham from were related to the “take being served a penal sumout” of a Chinese inmate mons in August 2012. from prison in January Fitial is the first gover2010 to give the governor nor among U.S. territories a private massage in his and U.S.-affiliated islands residence in the wee hours in the Pacific to be imof the morning. peached by the House of Besides Fitial and BuckRepresentatives. ingham, the other persons The CNMI House imcharged in the conspiracy peached him on 18 charges case were former CNMI of corruption, felony and Department of Public neglect of duty. He is also Safety deputy commisthe first governor in the sioner Ambrosio OguCNMI to resign. moro; Commonwealth CNMI Superior Court Ports Authority police associate judge David Edward Buckingham...came and left again. Photo: chief Jordon Kosam; CPA’s Wiseman issued the first Haidee Eugenio Capt. Juan T. Rebuenog; arrest warrant against Fitial and Fitial’s former personon March 6, but withdrew al driver and bodyguard, it the following day.

Jermaine Joseph W. Nekaifes.

The judge issued instead a penal summons, Florida-based human rights activist and former ordering the former governor to appear in court CNMI teacher Wendy Doromal said it should at 9am on the first Monday after receiving the not be difficult for authorities to locate Fitial in summons to answer the charges. the Philippines.

But in more than three months, Fitial has not “Fitial will not likely return on his own and returned to the CNMI and the penal summons will most likely show up in handcuffs like his for him remained un-served. co-conspirator, former attorney general Edward Fitial left the CNMI in the early morning Buckingham did,” she said. of Feb. 21, a day after resigning from office.

He recently underwent gall bladder surgery in ‘Surprise return’ the Philippines, where his wife Josie originally Buckingham caught everyone by surprise hails from. when he voluntarily returned on May 28 after The United States has an extradition treaty some nine months in hiding. with the Philippines. However, it is not known His return also comes after CNMI Governor if the CNMI will ask the Philippines for Fitial’s Eloy S. Inos signed two extradition requests adextradition to the Commonwealth. dressed to the governor of Iowa and later on, to A judge reissued the arrest warrant against the governor of Colorado, to bring the former atFitial on June 20 following the Office of the torney general back to the CNMI to face criminal Public Auditor legal counsel George Hasselback’s charges filed against him. renewed request three days prior.

Buckingham’s return and court appearance Hasselback said there has been no communidrew a host of reactions from elected officials cation from either Fitial or anyone acting on his and concerned citizens, but the common themes behalf about any plans to return to the CNMI were, “No one is above the law” and “Let justice to answer the criminal charges filed against him. take its course”.

Only Fitial remains un-served with an arrest The court said the US$50,000 cash bail that

By Haidee V. Eugenio

Politics Buckingham posted is sufficient to secure his presence on his trial on Feb. 3, 2014.

Buckingham is required to return to the CNMI no later than Jan. 26, 2014.

The CNMI’s non-voting delegate to the U.S. House of Representatives, Gregorio Kilili C. Sablan (Ind-MP), said Buckingham’s voluntary return “saves us all a lot of money and trouble”.

“It’s a good day for justice,” said CNMI House minority leader George Camacho (R-Saipan).

“Whatever the outcome is, nobody can elude justice. I don’t want to chastise him but we have a justice system in place. It’s not a perfect system but we have to rely on what we have.”

Ed Propst, a concerned citizen that has been campaigning for good governance and corruption-free government, said Buckingham’s return “speaks volumes for our local judicial system and shows that no one is above the law.”

“We have taken a huge step forward and it appears we no longer need to depend on the federal government to prosecute corrupt government officials. I am grateful to Judge Wiseman, the Office of the Public Auditor, brave and independent journalists and news reporters, and of course the good people of the CNMI who stood up against corruption,” he said.

New investigation But while many were relieved that a highprofile fugitive from justice voluntary returned to face the charges against him, Buckingham’s surprise return to the CNMI and his subsequent return to Colorado a week later raised a lot of questions.

They include how a fugitive from justice was able to pass through the airport without being served an outstanding arrest warrant especially when he’s a high-profile individual.

CNMI Attorney General Joey Patrick San Nicolas launched an investigation into this.

From Colorado and via Hawaii and Guam, Buckingham arrived at the Francisco C. Ada/ Saipan International Airport and was picked up by his counsel, Brien Nicolas.

No law enforcement agency served him with the outstanding arrest warrant at the airport.

It is not only the CNMI’s former governor and former attorney general that are in the news recently in connection with criminal cases.

In late May, Fitial’s former lieutenant governor, Timothy P. Villagomez, was brought back to the CNMI from Arizona for a resentencing, after a U.S. Court of Appeals for the Ninth Circuit found that a judge made a mistake in calculating the defendant’s sentence.

Villagomez was sentenced in August 2009 to seven years and three months in jail for his conviction in a conspiracy to defraud the Commonwealth Utilities Corp. through needless purchases of a de-scaling chemical called Rydlyme. His new sentence is nine years. The former CNMI lieutenant governor was supposed to be brought back to Arizona to serve his sentence.

U.S. District Court for the NMI Emeritus Chief Judge Alex R. Munson knocked off two years in recognition of the former lieutenant governor accepting responsibility for his crime.

Villagomez admitted he received some US$25,000 cash from the conspiracy.

In all these, “the justice system works” in the CNMI at least “so far,” said House Vice Speaker Frank Dela Cruz within hours of Buckingham’s return to the CNMI. Islands Business, July 2013 17

Politics

By Makereta Komai, PACNEWS

MSG leaders...

Fiji hands chair to FLNKS. Photos: Nic Maclellan

MSG aims ‘to restructure the Pacific landscape’ Summit supports Kanak and West Papuan self-determination

By Nic Maclellan As the Melanesian Spearhead Group (MSG) celebrates its 25th anniversary, last month’s MSG Summit in New Caledonia showcased renewed purpose and a range of initiatives by the largest islands nations.

The outgoing MSG chair, Fiji Prime Minister Voreqe Bainimarama, told the summit: “I believe that MSG solidarity has never been stronger. We are taking bold steps to restructure the landscape of the Pacific to better suit the needs and aspirations of our people. We are opening up possibilities and creating opportunities that other regional organisations have not .”

The five MSG members include Papua New Guinea, Fiji, Solomon Islands and Vanuatu, together with the Front de Libération Nationale Kanak et Socialiste (FLNKS), the coalition of par18 Islands Business, July 2013

ties calling for independence in New Caledonia.

The issue of self-determination in New Caledonia and West Papua was highlighted on the 19th summit agenda (with Bougainville likely to raise its profile in the coming years).

MSG leaders also addressed initiatives in regional co-ordination, environment policy and trade between Melanesian nations. Vanuatu Prime Minister Moana Carcasses Kalosil proclaimed: “I am proud that the MSG Trade Agreement is the only active trading agreement in our region,” in sharp contrast to the drawn-out PACER-Plus and EPA trade negotiations.

With Fiji, Papua New Guinea and Vanuatu trading duty-free under the MSG Trade Agreement since January 2013, the summit discussed increased inter-island labour mobility and the concept of an MSG Stock Exchange to facilitate the movement of capital across MSG borders.

Looking ahead to the next 25 years, the Melanesian Spearhead Group (MSG) wants to stamp its mark as a solid political sub-regional entity that effectively responds with confidence and authority on issues impacting its members and the Pacific at large.

To do so, the sub-regional bloc will promote itself as an ‘enhanced sub-regional’ group, casting its net wider to include the international community in its list of friends and partners.

This bold vision is captured in a 47-page report of the Eminent Person’s Group led by Fiji’s Kaliopate Tavola.

As Tavola puts it, “The rebranding builds on the current status of the group, with an enhanced role that reaches out within the Pacific region and globally.”

“We have explained in the report mechanisms by which the MSG can reach out. That way the MSG can provide leadership and create initiatives for other Pacific Islands Countries so that we can share some of these benefits with other Pacific Islands Countries.

“Given the growing prominence of the MSG as a sub-regional group, the plan is to also look beyond regional borders.

“We are looking at improving our bilateral relations. We want to take advantage of the fact that we are now a legal entity under the UN. We want to take full advantage of that to secure more developmental assistance.

“At the sub-regional level, the MSG will seek partnership with existing sub-regional groupings in the Pacific.

“The MSG can have partnership with the Polynesian Leaders Group (PLG), which has just been established. The Micronesians have also established their grouping and over many years now we’ve had the Smaller Islands States in existence.

“We have to be more strategic in the way we choose the subjects for our co-operation. We have proposed two important issues of fisheries and climate change for instance,” said Ambassador Tavola.

After two months of exhaustive consultation with member countries in Fiji, Papua New Guinea, Solomon Islands and FLNKS in New Caledonia, the group last month presented to MSG Leaders in Noumea a new direction for the MSG, where the organisation sees itself as a sub-set of Pacific regionalism, without any aspiration to become a regional organisation in competition with the Pacific Islands Forum

Leaders received the report of an Eminent Persons Group (EPG) led by Fijian statesman Kaliopate Tavola, looking at the successes and challenges of the past, and mapping priorities for the MSG’s future. The increased profile and partnerships of the sub-regional organisation were highlighted by Fiji’s Foreign Minister Ratu Inoke Kubuabola, who stated that the MSG is poised to take “a quantum leap” into the future.

Behind the public expressions of solidarity, however, there were also tensions that will cause ongoing challenges for Peter Forau, DirectorGeneral of the MSG Secretariat in Port Vila.

A notable absence from the summit was PNG

Melanesian Spearhead Group

The

me l a n e si a n dre a m

Congress support for MSG Secretariat...Victor Tutugoro, Roch Wamytan and MSG Secretariat’s Peter Forau.

Secretariat. Instead, it wants to ‘consolidate its opportunities, readjust and learn from lessons drawn from both the mistakes and strengths of other groups.’

These opportunities lie in ‘reaching out to the rest of the Pacific and beyond, as an extension of its Melanesian inclusiveness’.

The MSG will establish an outreach programme to the rest of the Pacific as an honest expression of its serious demonstration of its international citizenship responsibilities, said the EPG report. Part of this re-branded strategy includes working closely with the emerging Pacific Islands Development Forum (PIDF). PIDF, from August this year will replace the Engaging with the Pacific, a Fiji Government initiative to bring all Pacific Islands Countries together to discuss common issues of mutual interest.

The EPG admits the establishment of PIDF is

reconfiguring Pacific regionalism.

“Taking a long-term and strategic view of Pacific Islands Countries (PICs) and Pacific Small Islands Developing States (PSIDS) and their interests in the global context whose landscape is changing constantly, PIDF offers the best strategic advantages.

“PIDF presents the golden opportunity for the PSIDS to speak with the same voice and unity of purpose on global issues that are confronting humanity today.

“Regionally, the MSG will strengthen cooperation with regional organisations.

“The MSG will seek areas of synergies and collaboration, avoiding duplication.”

The EPG recommends that the MSG Secretariat concludes co-operation agreements with the Secretariat of the Pacific Regional Environment Programme (SPREP) and the Pacific Islands

Prime Minister Peter O’Neill and Foreign Minister Rimbink Pato, who were leading a large delegation of ministers, officials and businesspeople to Indonesia. Their presence in Jakarta as the MSG debated West Papua shows the priority given to relations with PNG’s powerful neighbour. Even though PNG Deputy Prime Minister Leo Dion and Ambassador to Fiji Peter Efeare carried Port Moresby’s views into the summit, O’Neill’s absence was noticeable on several occasions, including the closing ceremony where Papua New Guinea was not represented.

Fiji too has stronger ties to Jakarta, after it exchanged ambassadors with Indonesia and

welcomed the Asian power as an observer as Suva hosted the previous MSG summit in 2011.

To the disquiet of some delegates, Fiji arrived with a roadmap to drive the West Papua debate, following a meeting held in Nadi in early June between Prime Minister Bainimarama and Djoko Suyanto, Indonesia’s Coordinating Minister for Legal, Political and Security Affairs and a former commander of Indonesia’s armed forces.

Bainimarama received a warm welcome at the opening ceremony, winning applause for his role as MSG chair over the last two years.

However, some participants expressed concerns over Fiji’s flawed transition to parliamentary

Forum Secretariat (PIFS) and the Pacific Islands Forum Fisheries Agency (FFA), similar to the agreement made with the Secretariat of the Pacific Community (SPC).

Melanesian Dream From their consultations, the EPG found the Melanesian renaissance of the last 25 years has been a learning process that has engendered a collective sense of camaraderie and tour de force that has given birth to a new dream.

“This is the dream of being united under the banner of a new vision with clear outcomes to which we can claim ownership, of readiness to take a quantum leap into the future, of restoration that we want to clean and improve our image and change how others regard us, of enterprise that ‘we can do it’ and that we do not have to wait around for someone else to tell us what to do and how to do it.

To realise this dream, the MSG must be serious about being a regional and global player of note.

“The group should make all its decisions binding so that decisions are followed up, implemented with relevant policies and resource allocation, monitored and evaluated. The MSG constitution must be amended to reflect this appropriately and national law reform carried out to ensure proper legislation and national structures are in place for the delivery of government services.

The Melanesian Dream is founded on a sense of maturity and premise that the current generation of MSG Leaders has the singularity of purpose to leave a legacy.

In the parting words of one of the founding fathers of Melanesia, the Grand Chief, Sir Michael Somare, “MSG has come a long way from its humble beginnings in Goroka. We certainly have not reached the ‘promised land’ that our people deserve and expect us to deliver.”

The Kanaky people’s dream of emancipation has not been realised yet, said Somare.

As the MSG moves forward, he appealed to the more well-endowed members of the MSG to be prepared to make sacrifices and ‘forego certain benefits for the common good and long term solidarity of MSG.’ “The willingness to extend a helping hand must continue to guide MSG’s approach to regional co-operation, said Somare.

At the end of the 19th Summit of MSG Leaders in Noumea, there was a general feeling of optimism that the Melanesian sub-regional group is on course to take that quantum leap of faith into the future.

elections. In a public lecture, Grand Chief Sir Michael Somare stated that the political situation in Fiji continues to test MSG solidarity “with a real risk of a chasm developing between MSG members if we are not careful.”

Solidarity with the Kanaks As one of the signatories to the original MSG Agreement, Somare attended the summit as a guest of honour. He was joined by Vanuatu’s Ham Lini, representing the family of the late Walter Hayde Lini (the summit communique announced a Jubilee Scholarship Scheme in the name of the MSG’s founding member, who led Islands Business, July 2013 19

Politics Pacific francs for the secretariat, and was initiated Vanuatu to independence in 1980). and signed by the Deputy Speaker of the ConFormer President of French Polynesia Oscar gress Roch Wamytan, who previously served as Manutahi Temaru was also received with plaudits MSG chair in 2001). after he lost the battle but won the war—losing Some anti-independence leaders called for the the recent election to long-time rival Gaston FLNKS to be replaced by the Government of Flosse but finally achieving his goal of re-inNew Caledonia as the official MSG representascribing Maohi Nui on the United Nations’ list tive. But New Caledonia’s President Harold of non-self-governing territories.

Martin told Islands Business he was happy to Temaru’s call for self-determination in the French Pacific echoed across the week—the work under the current arrangement. central feature of the summit was the proud re“Since the 2007 Forum in Tonga, I’ve been sayaffirmation of MSG support for the FLNKS and ing that the government of New Caledonia would the Kanak independence struggle. like to represent our nation as a full member of This year marks the 25th anniversary of the both the Forum and the MSG,” he said. “But Matignon-Oudinot Accords, which ended the we’re in the Pacific and it takes some time. Unarmed conflict that raged across New Caledonia like my predecessor, I am quite reserved on this between 1984 and 1988. The MSG too celebrates matter and we await the decision of the FLNKS 25 years since it was founded in March 1988, about when the government could take a greater jafter years of co-operation between Melanesian role in the MSG.” leaders in support of Kanak independence.

Today, representatives of the Kanak movement Debate over West Papua sit alongside opponents of independence in the The other high profile issue was West Papua, multi-party government of New Caledonia. But with the FLNKS formally inviting the West the FLNKS continues to look Papua National Coalition for for solidarity from neighbourLiberation (WPNCL) to attend ing Melanesian countries as a the summit. key element of their campaign A five-person delegation led for decolonisation.

by WPNCL Vice President In order to link with local John Otto Ondawame and Kanak communities, the MSG Secretary-General Rex Rumaksummit was spread across iek arrived to lobby support of all three provinces in New their bid for MSG membership, Caledonia, with senior officials after a formal application was meeting in the northern town lodged with the MSG Secreof Pweedi Wimia (Poindimie), tariat last March. foreign ministers gathering Other activists from the on Lifou in the Loyalty Is“Federal Republic of West Paplands, while the final summit ua”, led by Jacob Rumbiak, also opened in the southern capital arrived in the New Caledonian Noumea. capital, while Indonesia sent a In Lifou, Caroline Macholarge delegation to press its case, ro-Reignier of the FLNKS including former independence Peter Forau...MSG Secretariat directortook over as chair of the MSG general. activists Franz Albert Joku and Foreign Ministers Meeting Nick Messet.

(FMM). She is the first woman With PNG and Fiji officials to hold the post and noted: and ministers highlighting the “This appointment is a sign Melanesian women “sensitive” and “complex” nature of their relaare ready to take their place as leaders.” tionship with Indonesia, the FLNKS and Vanuatu Under its Parity Law, New Caledonia’s elecexpressed stronger public support for the West toral system is designed to ensure that half the Papuan cause. elected members of the provincial assemblies “If this issue came up today within the MSG, and Congress are women—a far cry from other it’s because the FLNKS requested it,” MachoroMelanesian nations where women are barely Reignier said. “We asked the representatives of represented in national parliaments.

West Papua to come to New Caledonia to explain FLNKS spokesperson Victor Tutugoro will the situation to us. serve as MSG chair over the next two years, tak“We cannot just leave the issue aside, with all ing the role at a crucial time. After elections in the exactions, the violations of human rights that May 2014 for New Caledonia’s three provincial West Papua is suffering.” assemblies and Congress, the incoming parliaEarlier this year, the new government in Vanumentarians must decide whether to proceed to a atu led by Moana Carcasses Kalosil overturned referendum on self-determination before 2018. close ties with Jakarta established by former The MSG summit opening was broadcast live Prime Minister Sato Kilman. In his address to on local TV and radio, but detailed newspaper the summit, Carcasses stated that West Papua’s coverage was sparse and local politics intruded. cries for freedom “have been bluntly denied by Calédonie Ensemble leader Philippe Gomes, many rich and wealthy countries including the who serves as New Caledonia’s representative United Nations for many decades...so I say that in the French National assembly, unsuccessfully we as brothers must stand up for them. The lobbied the French Foreign Minister to refuse epicentre of support for the advocacy for West a visa to Fijian PM Bainimarama. The Speaker Papuan self-determination must begin in this of New Caledonia’s Congress Gerard Poadja, a region, Melanesia.” member of Gomes’ anti-independence party, also After extensive debate and lobbying in the boycotted the signing of an agreement between corridors, MSG leaders agreed to defer a decithe Congress and the MSG Secretariat in Port sion on the West Papua membership application Vila (The agreement includes 25 million French until after an official visit to Jakarta and Jayapura 20 Islands Business, July 2013

later this year. Fiji will lead the MSG ministerial mission, which must report back to the leaders within six months.

In Lifou, Vanuatu Foreign Minister Edward Natapei told Islands Business that his government accepted the consensus decision on the mission.

“Our reaction follows the majority in the meeting. It seems we are outnumbered, so we have to comply with the majority. I’m happy with that decision,” he said. “What we want is some timelines to ensure this issue is going to be dealt with within this year.”

WPNCL’s Ondawame expressed disappointment that the membership application was delayed, arguing that the Indonesian government and military would work to stage-manage the MSG mission. However, he said he valued the opportunity to address the summit plenary and highlighted positive commitments by the MSG leaders.

In unprecedented language, the final communique supported “the inalienable rights of the people of West Papua towards self-determination” and criticised “human rights violations and other forms of atrocities relating to the West Papuan people.”

Indonesia’s case was not helped by a breach of protocol during the leaders retreat at Escapade Island Resort. Members of the Indonesian delegation travelled by boat to the island where MSG leaders were meeting.

A member of the delegation confirmed to Islands Business that the incident had taken place, but described it as an “unfortunate step” after the delegation “possibly tried to communicate with the leaders—but I think they chose the wrong time.”

Beyond the high-profile debates, the summit covered a range of issues including reports from the March 2012 MSG Environment and Climate Change Conference and the May 2012 MSG Trade Ministers Meeting. Leaders agreed to draft legal text for a third phase of the MSG Trade Agreement, to extend negotiations beyond trade in goods into services and investment.

The leaders signed agreements affecting justice and legal relations between MSG member countries, including a Memorandum on Police Co-operation, a Treaty on Custody and Child Maintenance and a Treaty on the Enforcement of Foreign Judicial Rulings. They also endorsed the concept of an MSG Department of PeaceKeeping Operations (DPKO).

Drawing on his expertise as a former foreign minister and ambassador, Tavola was named as an MSG High Level Representative for the next two years.

Tavola told Islands Business he was awaiting a formal terms of reference, but said: “It’s obviously a kind of roving ambassadorial role.

The High Representative will work on instructions and mandate from the leaders, especially to promote what the MSG is all about, increase the partnerships that MSG can have with other development partners and donors and address the possibility of the MSG accessing some of the European Development Fund (EDF) allocations.”

MSG leaders old and new came away from the summit with renewed purpose, with Somare calling on member states to employ their size and strength to the service of the region: “An MSG without the Pacific is the weaker, just as a Pacific without the MSG is the poorer.”

Politics

tonga

Bracing for tough times...Tonga’s economy enters challenging times. Photo: bahai-insights.blogspot.com

Tonga braces for tough times Falling remittances, public debt plague nation

By Dionisia Tabureguci T onga is banking on gov ernment’s capital projects and a stricter 2013/2014 national budget control to drive economic growth this financial year.

Falling remittances, low export performance and steep public debt have plagued the island kingdom in recent times, pushing it to very difficult economic conditions.

In May, the National Reserve Bank of Tonga (NRBT) announced a continuation of an accommodative monetary policy stance, necessary to stimulate investment, although this has been slow to translate to visible private sector takeup.

By mid-May, demand for credit was still low as revealed after a meeting between NRBT and the Association of Banks in Tonga (ABT).

At the moment, much depends on government investments while some fundamental indicators point to the need for stronger measures in order for Tonga to get to comfortable territory.

“Real GDP grew by 0.8 percent over the 2012 financial year, supported by a pick-up in public sector construction activity and growth in the agriculture sector,” NRBT said in May. “The industries most exposed to tourism recorded poor outcomes following a decline in visitor numbers. Tongan consumer prices rose by 1.1 per cent over the 12 months to February 2013, largely due to increase in imported food prices.

In the 2013 financial year, Tonga is expected to record real GDP growth that is similar to the

2012 financial year. Growth is then projected to strengthen in the 2014 financial year. The projection reflects a balance of several developments: the government is implementing a stricter budget in 2013 than in 2012; construction activity is expected to slow in 2013, but then pick up again in 2014 with the commencement of some large new public works; activities in agriculture, tourism and trade sectors are expected to grow; and activities in the fisheries industry is projected to contract in 2013.”

The remittance and donor funds-dependent economy has been struggling in some key sectors, mainly from the big fall in remittances over the last five years.

In a national economic summit early last year, NBRT governor Siosi Mafi revealed in her presentation that private remittances had fallen by TOP$80 (Tongan pa’anga) million since 2008, a direct impact of the global financial crisis which affected most Tongans living overseas.

Since 2006, agricultural exports had fallen by 70 percent, fish and other marine exports had dropped by 62 percent, while overall exports declined by TOP$20 million since 2006. Tourism showed potential and foreign exchange reserves were propped up mostly by donor funding.

Tonga has been advised after an Article IV consultation by the International Monetary Fund (IMF) early this year to consolidate its financial position and shift monetary policy to financial stability.

Of great concern to the country was its high public debt—at 43 percent of GDP, most of that

being foreign debt.

Total public debt, according to its national budget 2013/2014 statement delivered last month, was estimated at TOP$355 million at 30 June 2013 (43 percent of GDP), an increase of TOP$2.9 million from June 2012.

Of that, Tonga’s total external debt at 30 June 2013 was estimated at TOP$325.5 million (39 percent of GDP) with the total outstanding amount of TOP$209.1 million (64 percent) to EXIM China, TOP$61.3 million (19 percent) to the Asian Development Bank (ADB) and TOP$39.0 million (12 percent) to the International Development Agency, the World Bank’s fund for the poorest..

“The other smaller borrowings are from International Fund for Agricultural Development (IFAD) at TOP$8.3 million (2.5 percent), Bank of China (BOC) TOP$7.0 million (2.2 percent), and European Investment Bank (EIB) and Westpac Australia making up the remaining TOP$0.8 million (0.3 percent).

During the last year, the main change was an increase in the outstanding loan balance to EXIM of TOP$10.7 million (5.1 percent), mainly as a result of the final drawdown for a roads project and also a decrease on the settlement of the loan balance to Westpac New Zealand in September 2012 from sale of the Tonga High Commission residential property in Wellington of TOP$1.3 million (0.4 percent),” the Tongan government said in] its 2013-2014 budget.

With continuing challenges domestically, Tonga’s external debt repayment this financial year (2013/14) will increase by TOP$9.1 million to TOP$20.1 million, steep for a government supported largely by donor funds and a narrow revenue base. Tonga has adopted a no new loans policy to keep its debts at bay.

“Government recognises the importance of good debt management and reporting and is working with development partners such as the Commonwealth Secretariat and the World Bank to improve this. Government continues to report regularly on its debt position,” the budget statement read.

“Given the debt sustainability ratios going forward, it shows that government will continue to face difficulty in maintaining debt levels within the recommended targets, especially the external debt ratios. Going forward, it is vital that our current level of economic activity prospects improve together with prudent public debt management, in order to mitigate the vulnerability to shocks on the government’s debt portfolio and impact on our limited financial position.”

Tonga’s national purse is tightly squeezed despite this year’s projected total TOP$357.6 million for appropriation, which it admits makes it its “biggest national budget in history.”

“Given the very tight financial conditions, only the most top priority initiatives identified in the government ministries’ corporate plans and budget discussions could be funded,” said finance minister Lisiate ‘Akolo in his budget address.

Lingering concerns though remain. Among them, the slow recovery of the Unites States economy, the chief source of its remittances, and its debt sustainability rating by the IMF, which has improved.

With that improvement however, half of its grant from the IMF will have to be converted to a loan and this will put more pressure on its national debt profile.

Islands Business, July 2013 21

Politics

Busy Honiara...capital of the Solomon Islands. Photo: Islands Business

35 years on, where is Solomons heading?

A nation on the downward spiral

By Alfred Sasako Solomon Islands is a nation in rapid decline.

After billions of dollars in new money were pumped into its economy particularly in the last 10 years, there is no appreciable sign that this nation of 580,000 or so inhabitants has moved—except downward.

In the 35th year since independence, no new roads, hospitals or high schools have been built.

On the other side of the social scale, demands have outstripped services as the population continues its upward climb.

The nation’s public sector workforce, once a vibrant and disciplined unit, appears to have lost the drive. Lack of consistency in disciplining erring public servants has weakened the resolve of many who strive to put in a decent day’s work.

Today, many top public servants are following the lead set by government ministers in terms of work ethics including attendance. Ministerial work attendance has sunk to its lowest in years, according to some public servants.

“You’d be lucky to see a government minister in his office twice in any one week. They simply don’t come into their offices,” one observer said.

The same is true of many public servants too.

Many simply come in the morning to sign in, but one never sees them again until the next day.

“The only day you see them in their offices for part of the day is on government payday. Any other day, they are not around,” the observer said.

In the law enforcement sector, police image has sunk to a new low.

So much so, that in the eyes of many, the nation’s police has been reduced to a security unit for many Asian logging companies.

“Some logging firms can just pick up the 22 Islands Business, July 2013

phone, call the police and they are there in an instant,” one man said.

The man’s observation is not without proof. In a recent incident, for example, one of the country’s Australian-supplied patrol boats was called to a logging camp to keep an eye on an overseas ship as it loaded a shipment of logs.

It is not clear who picked up the SB$25, 000 fuel bill for the trip.

Since that incident, there’s been a new development in police approaches to crimes and potential crimes being committed. You can now rent a policeman to do your bidding and you don’t have to get permission from anyone to do that.

Take for example, a recent incident involving an ex-logger businessman who literally handpicked five police officers without authorisation to supervise the illegal removal of machineries and equipment from a company doing a trial project on palm oil project on Malaita.

Islands Business has established that three of the officers were members of the Prime Minister’s Personal Protection Unit. The other two were from Auki police on Malaita. But that’s not all.

While police were planning a special operation to nab two fugitives who’ve been on warrants of arrests for more than two years, a police superintendent was secretly briefing the same businessman about the operation, which had to be called off.

A Royal Solomon Islands Police Force (RSIPF) spokesperson confirmed police involvement in the case but denied authority was granted for the officers to supervise the removal of the machines and equipment.

All five officers and the superintendent are under police internal investigation, which many doubt would yield any deterrent.

But it is not only on Malaita that this is happening. Take for example the case of Gold Ridge Mine, about 30km east of the capital, Honiara. In the last four months, illegal miners have invaded and occupied the mine’s gold-bearing pits.

Up to 150 illegal miners, posing as landowners, go down to the bottom of the pits at night, spending up to eight hours each time.

The so-called landowners claimed the operator of the mine, St Barbara has not paid them any royalty.

General Manager Stean Barrie was quoted in the local media as saying the illegal activities were having a “damaging impact” on production as well as royalty to the landowners and government taxes.

Barrie warned that “it is only a matter of time before an illegal miner is seriously injured or possibly (be) even killed”.

“Mine sites are potential dangerous areas with hazards such as heavy machinery and blasting.

There are families with women and children in active mining areas who we do not wish to put in danger,” he said.

“Furthermore, the disruptions to our operations has an immediate negative impact on productivity, which in turn lowers the amount of royalties, export duties and taxes that Gold Ridge Mining Ltd pays to the Solomon Islands Government,” he said.

Despite these concerns and the need to protect foreign investors, police have done little.

All police could say is that forced entry into the mine site is illegal and those who ignore the warning would be charged.

To-date, there’s been no attempt on the part of the police, let alone the government, to deal with lawbreakers.

In the Central Islands Province’s Russell Islands, a student was stabbed right in front of the police station at Yandina, but police never intervened.

The June 14 incident prompted the provincial politician for the area, Reuben Lent, to call on the Royal Solomon Islands Police Force to “dispatch active police officers who can maintain law and order under any circumstances.”

“A young man stabbed a student right in front of the police station and threatened others with a sharp object. The incident happened under the very nose of the police but they did not even raise a hand to intervene,” Lent said.

The judiciary which hitherto has been untouchable is also coming under heavy criticism.

There’s been claims in the local media in recent months that the web of corruption has engulfed the nation’s judiciary, including the Attorney General’s Chamber, a charge Attorney General Billy Titiulu was quick to dismiss.

Despite the denial, every sign seems to be pointing to a nation that is slowly dying from within. Its leadership at the political level appears dysfunctional at best and non-existent at worst.

Increasingly, politicians have been seen as a force for disunity and marginalisation rather than one of unity—all at the expense of taxpayers.

And how much does disunity and marginalisation cost?

This year alone, taxpayers and donors have handed the 50 politicians here SB$300 million in discretionary spending. It is money which has been pulled from government departments programmes and locked away by politicians to finance their elections campaign next year.

SOLOMON ISLANDS

Provincial premiers and officialsÉ

wait for the arrival of the deputy Prime Minister in Gizo, Western Province. Photos: Evan Wasuka

Integrity bill back on political agenda

According to the man responsible for putting the bill together, it’s a different animal from Sikua’s bill and one that could mean political stability for Solomon Islands.

Tuvalu national and technical adviser to the Solomon Islands Office of the Prime Minister and Cabinet, Mose Saitala says much work has gone into the bill, with national consultations and public feedback included in the bill, which was on the floor of parliament. finally endorsed by cabinet in June.

Fast forward three years and with Saitala was on hand at the 7th another election due in roughly Premiers Conference in Gizo, 14 months, the Political Parties Western Province, in late June, to Integrity Bill is back on the agenda. talk to provincial administrators This time its main opponents Political reform in the worksÉ about the contents of the bill. then are now its strongest support- Mose Saitala talks to provincial Its aim, he told provincial ofers, with the Gordon Darcy Lilo officials about the way forward. ficials, is “to develop a strong, vigovernment committed to push able and transparent political party through major political changes in time for the system for the purpose of ensuring and fostering next election. the stability of government and better political The bill, backed by Lilo’s stronghold on MPs, governance between the public and members is expected to make its way into Parliament later of parliament.” this year.

For the uninitiated, political parties in the

The way forward for the Solomons

By Evan Wasuka it wA w s bAck in 2010 during the closing days of the Derek Sikua government that the Political Parties Integrity Bill first appeared as a means of dealing with one of the major scourges of Solomon Islands politics, party hopping of members of parliament.

The bill’s aim was to bring about stability to Solomon Islands politics.

Though well intentioned, the bill didn’t see the light of day and was shot down by the majority of Sikua’s own MPs, who failed to support the bill

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Politics Solomon Islands are virtually non-existent. Even those that have existed over the previous elections seem to only come alive in the lead-up to polling and hibernate for the remaining four years until election time.

With no party line, politicians are voted into power based on their individual standing in their communities, their network and political support.

Political groups as opposed to political parties are formed after the national elections in order to reach a majority to become the next government.

More often than not, these political groupings are fragile and the movement of a few MPs, as seen in recent years, can lead to political chaos as different political groupings vye for dominance.

Political parties Under the new Political Parties Integrity Bill, Saitala says political parties can only be registered: • if they have a constitution: • if they have 300 or more paid-up members who are on the voters list; and • if the party has a symbol.

Politicians and party members can only belong to one party, the one that they are registered with.

Saitala says parties with similar manifestos are encouraged to merge.

The system to elect the prime minister will also change. Gone will be the current practice of all MPs coming into parliament at the end of the elections to vote for their candidate to be PM. In its place, Saitala says the government is proposing that the PM will be selected from the leader of the largest party in parliament.

In the case that there is no majority party in parliament, the party with the most members in

the governing coalition can nominate their leader to be prime minister.

Incentives The key to making political parties an integral part of Solomon Islands’ political life, says Saitala is to create incentives for intending candidates and politicians to form political parties rather than stand as independents.

In the bill, these incentives include a SB$20,000 party administration grant per annum for every party member who wins a seat in parliament.

If the member happens to be a woman, parties will get an additional SB$10,000 on their administration grant.

Although politicians may at first opt to continue to stand as independents, Saitala says the Papua New Guinea example, with the organic law, has shown otherwise.

“Over the past two PNG elections under a limited preferential system, the number of independent candidates has declined.”

Women in parliament With debate rife in the Solomon Islands over reserved seats in Parliament for women, Saitala says the bill takes a different approach to ensuring women’s participation, through political parties.

“All political parties must do their best to ensure that 10 percent of their members are women, sufficient to say that there are enough women who apply to become political candidates.”

Saitala says a nationwide consultations carried out on the Political Parties Integrity Bill found that the public were not receptive to the idea of having temporary seats for women.

“So our path in order to comply with the country’s commitment to the Convention on the Elimination of Discrimination Against Women is to offer incentives for women to participate through political parties.”

Institutional Changes According to the proposed bill, the key body responsible for administering political parties will be the Electoral Commission.

As part of the reforms, Saitala says Parliament will be consulted on making constitutional changes to the power of the Electoral Commission.

“Right now the Electoral Commission is only tasked with registering voters and managing national elections.”

The commission’s role will need to be expanded to registering and removing political parties as well as to monitor the standards that they operate in.

“Rather than creating a new body, we want to utilise the current system and maintain institutional costs.”

The chief electoral officer will be the registrar of political parties who will be the key person in registering and disciplining parties that do not adhere to the law.

Although the changes to the Electoral Commission’s role will be small, Saitala, admits that it will also be one of the toughest parts of the reforms with the changes needing support of three quarters of Parliament.

With the bill approved at cabinet level, the next test for the Political Parties Integrity Bill will be Parliament, where the nation will see that leaders have had a change of heart since 2010.

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Politics

BOUGAINVILLE Viewpoint

Bountiful and beautiful Bougainville

By Dr Satish Chand

I

have for the past three years been travelling to the Autonomous Region of Bougainville (ARB) which formerly was the North Solomons Province of Papua New Guinea.

The people of the ARB, that now number approximately 200,000, suffered immensely during the decade-long conflict that commenced in November 1988 and was brought to an end after the peace agreement signed in August 2001.

They are now slowly rebuilding from the ashes of the conflict.

‘Cooked’, the local lingo for the setting of fire, were infrastructure, houses, hospitals, warehouses, schools, and much of the townships of Panguna, Toniva and Kieta. Thousands of people were killed as the police and subsequently the PNG Defense Force tried to muscle in the combatants. The killing and destruction that ensued is a major blemish on the history of PNG, and the Pacific more generally.

Bougainville has remained peaceful for the past decade and a half. Schools, hospitals, and townships are being rebuilt. Australia, New Zealand, and Japan are helping rebuild roads, bridges, schools, health facilities and police posts. Medecins Sans Frontieres (MSF or Doctors without Borders) is doing a marvellous job providing health services in South Bougainville.

Discussions are ongoing on the reopening of the Panguna copper mine that halted production in May 1989. When exactly will the mine reopen remains to be resolved, however. Rio Tinto, the majority owner, makes no secret of its “focus on finding, mining and processing the Earth’s mineral resources in order to maximise value for [its] shareholders”.

The people of Bougainville remain deeply divided on the desirability of reopening a mine that triggered the conflict and has been dormant for the past four years. Some of the folks I spoke to were eagerly awaiting the reconstruction of the mine, in the hope that it will bring income, taxes, employment, social services, and the like of the good days gone by. Arawa, Kieta and Panguna at the height of mining were bustling towns. A former Miss PNG told me that those were the days when women shopped in high heels pushing trolleys in large supermarkets in Arawa. Others that I spoke to were just as cautious, warning of the environmental damages caused by BCL (Bougainville Copper Limited), the effects of which remain to this day.

Most outsiders think of Bougainville as a giant ruined mine that once produced mega dollars worth of copper, gold and silver. Others think of the mainland of Bougainville as a large heap of precious minerals and little else.

These perceptions are wrong. Mainland Bougainville is rich in resources. The problem with Bougainville is that it has too many resources.

And the poverty in contemporary Bougainville can be attributed to the bountiful resources.

The largest resource Bougainville has is its people. Friendly, fullsome and funny people

Paul Akaoitai, the resident (bare-chested) chief...plans to build more catchments with bigger turbines to light up all of north Bougainville. Photo: Satish Chand

all the way from Buka in the north to Buin far down south. Bougainvilleans are big and beautiful people. Many have a wicked sense of humour, pointing out to me that the missionaries who went there from Fiji one hundred years ago tasted good.

Late last month while on my way to Arawa, I stopped to collect some bananas and kulao (green coconuts) at a roadside market. The old market vendor with teeth and gums stained to the lips with betel nut handed me a heap of green-skinned bananas and cut open a fresh green coconut—all for Kina 3 (approximately A$0.30).

The bananas were the best I have had for a long while. I commented (in Tok Pisin), while munching a mouthful, that these were really sweet. This old lady retorted, in English, that “this is the sweetest bananas in the Pacific region”. I corrected her by stating that ‘they were the second sweetest bananas in the Pacific’. I got the expected reaction from her: “what do you mean?” I told her, in a cool and collected voice: ‘Fiji has the sweetest bananas’. The stained gums and teeth stuck out behind a beaming smile. Pointing her finger straight at me, she shouted out that I was from Fiji. I pretended to be an Indian, but to no avail as she just laughed it off, telling me that I was a Fiji Indian! We talked for a while after that when she relayed her stories of having visited Nadi and Suva, though some several years ago. And best of all, she had some extremely fond memories of a nation that I still call home.

Tourism, untapped potential The economy of Bougainville remains battered and broken. But a lot is changing. Bougainville still boasts the best war relics from the Second World War. Memories of General Yamamoto, who was shot down and killed in South Bougainville, remain in the form of a primary school there. Old Japanese tanks, many unexploded mines, ‘dead’ and the few live guns that are constantly being

dug out from the dumps, and a lot more await the keen eye.

Torokina, which once was a thriving American military base and now a land-locked district located on the Empress Augusta Bay on the west coast of the mainland, is perhaps the best kept tourist secret within the entire South West Pacific. Some five hours ride on a banana boat from Buka, and that is possible only on a good day, would get the most determined traveller seasick.

But once there, it is a spot worth all the trouble.

Guesthouses, albeit with very basic facilities, are there for the thrill-seeker.

Realising the tourism potential of Bougainville requires better transportation links around the autonomous region. Given the rough terrain, a ring road around the mainland is difficult but a shipping service as a substitute requires just a few jetties—most of them already in place except one in Torokina. The above together with improved law and order could entice a shipping company into providing a round-the-island daily shipping service. Communications is less of an issue as my Digicel phone worked fine, allowing me to talk to my son in Canberra from nearly all over the autonomous region.

And bringing light Bougainville is emerging from the dark past of its violent crisis. Electricity generated from diesel powered generators is now supplied to residents in Buka, Arawa, and Buin. A small home-made hydro-electric plant supplies electricity to parts of Panguna. More home-made hydro-electric plants light up villages in the surrounding hills too.

Bougainville has a lot more potential to generate hydro-electricity. Fresh water is one of the many things that the people of the mainland have in plenty. The large mountain range that runs as a spine on the centre of the mainland has fed large and fast flowing rivers, each of them surrounded by dense forest. One community has partnered with PNG Sustainable Development Program Ltd (PNGSDP) to build a turbine with a capacity of generating 0.2 megawatts in Togarau, a community located in the mountains of North Bougainville.

Paul Akaoitai (pictured), the resident (barechested) chief who showed me around the site, explained that they had plans to build more catchments with bigger turbines downstream to light up all of north Bougainville. His community is drawing up plans to build a piggery, a poultry farm, and a potato chips venture so as to provide a sustainable source of income for the many smallholders engaged in growing fresh garden produce. Just as well, given that cocoa, the backbone of the economy, has suffered a heavy blow from cocoa pod borer.

Bougainville is beautiful and its bountiful resources have the potential to provide for the needs of the majority of its people. A large mine could help but only if the mistakes of the past are not repeated.

Islands Business, July 2013 25

Business

No EPA nor PACER? EPA talks stall, PACER Plus hits snag

By Samisoni Pareti Negotiations for a comprehensive Economic Partnership Agreement with the European Union by the 14 Pacific countries, which are members of the ACP bloc resumed in Brussels in the last week of June.

However, a leading trade expert believes the Europeans would not care less if the Pacific delivers on its threat to walk out of EPA negotiations if no agreement is reached by the end of the year.

“I know the EU wants to trade global sourcing rules of origin for access for their vessels,” Professor Roman Grynberg wrote in an email response to questions from Islands Business.

“We were willing to do a deal if it included a whole host of other things in fisheries such as investment and aid for trade but they wanted it for nothing and the PACP (Pacific members of the ACP group) are wise to resist.

“We remain almost completely irrelevant to the EU’s commercial interests, so they will continue to treat the Pacific with this level of disrespect.

“It is part of a game as you put it, but the EU would not be that fussed if there is no EPA.” Professor Grynberg should know. He was Director of Economic Governance and responsible for trade with the Suva-based Pacific Islands Forum Secretariat when EPA negotiations began with the Europeans a decade ago.

He is now a senior research fellow at the Botswana Institute for Development Policy Analysis in Africa.

The reference to the threat to walk out of EPA talks by the Pacific ACP countries was contained in a strongly worded letter the Pacific lead spokesperson wrote on the eve of the continuation of EPA negotiations in Brussels.

It was dated June 4 and signed by Tonga’s Minister for Commerce, Tourism and Labour, Dr Viliami Uasike Latu.

“We have a clear directive from our leaders to conclude negotiations on a comprehensive EPA as a single region before the end of this year,” wrote Dr Latu.

“We will be submitting our final report to our leaders at their meeting in September and I am afraid that if no tangible progress is made before then—this could be the end of our 10-year long negotiating process.

“This would be disappointing especially after spending so much time and money on this process.

“We have done everything possible on our end; we submitted all the market access offers and provided detailed responses to your questions on fisheries issues. But it looks like there is no end to the “question and answer session”.

“We have reached a point where we need to conclude this process one way or the other.”

Interviewed by Radio Australia about a week after sending the letter, Dr Latu confirmed that 26 Islands Business, July 2013

he had received no response from Brussels.

Most likely the Pacific trade officials went into the latest rounds of EPA negotiations on June 25 without a reply.

Islands Business had reported last month that fisheries, market access and services would be key negotiation points.

This could be cited from a speech made by the European Ambassador to the Pacific, Andrew Jacobs, in Fiji in May when he attended a cocktail hosted for Pacific trade ministers.

The Pacific ACP ministers were discussing their negotiation tactics that week at a hotel in Nadi.

In that speech, Ambassador Jacobs accused the Pacific of being “inflexible” in the EPA negotiations and indicated Brussels’ unwillingness to offer more concessions on its global sourcing offer for Pacific tuna exports.

He said there are growing political opposition to the global sourcing offer and recent studies threw some doubt on the effectiveness of such concessions.

Dr Latu’s five-page letter was in some ways the Pacific’s response to the Ambassador’s speech, although the European envoy had explained that his headquarters had prepared his talking points.

With the chances of the Pacific concluding EPA talks by December looking not so promising,

movement in other trade negotiations with the Pacific Islands’ closest and bigger neighbours of Australia and New Zealand on PACER Plus are not looking brighter either.

The latest roadblock is in the form of Papua New Guinea’s threat to walk out of PACER Plus negotiations.

“My country is not interested in PACER Plus, our focus is the MSG Trade Agreement,” PNG’s Trade Minister Richard Maru told reporters in Fiji in May. He was attending a meeting of MSG Trade Ministers.

“Our feeling at the moment is that PACER Plus would be one sided in favour of Australia and New Zealand.

“We are frustrated with them.

We can’t export our taro there, they won’t accept our greens. There’s nothing to be gained from a trade agreement at the moment.

“We cannot justify the huge amount of resources we expend on such negotiations. They are a complete waste of time.”

There was no immediate response from Canberra or Wellington on PNG’s position.

In the latest rounds of PACER Plus negotiations, Pacific Islands negotiators had complained about the two countries’ opposition to making PACER Plus a pro-development agreement to benefit small, developing islands economies.

Because of its suspension from the Pacific Islands Forum, Fiji is not directly involved in PACER Plus talks.

Now with the largest economy in the islands talking about walking out of PACER negotiations, Professor Grynberg believes only PNG and Fiji would be the biggest losers, not Australia or New Zealand.

“You can in theory have a PACER Plus agreement without PNG and Fiji but it really does not mean much.

“To walk out of PACER for PNG would be foolish as it would allow Australia to write the agreement with no one there to disagree.

“The other small states can only put up a token resistance to anything Australia really wants.

“Only the two larger countries are in a position to say no. Once it is agreed by the other states, there is no way out and a future PNG government will have to sign what is there.”

Business

Newcrest’s crisis worries O’Neill

tion of mines. The future of the A$5.6 billion Frieda River copper-gold project is uncertain, because its 81.8 percent owner, Xstrata, has recently restated its reluctance to take a lead in such greenfield ventures.

And the position of the Ok Tedi mine, which has been the country’s biggest income earner for several years, is uncertain with its current lease concluding at the end of this year, and with the government seeking to assume full ownership.

Those problems underline the importance of Newcrest to PNG, where half of its assets by value are located. It is inevitable that the company’s he would take direct responsibility for negotiating writedowns will massively affect its operations

By Rowan Callick what remains the biggest development project there and elsewhere in the region—including Papua New Guinea’s Prime Minister Peter in Fiji. But it remains at the pre-feasibility stage, in Fiji, where plans and dates may need to be O’Neill moved swiftly in mid-June to address a with an environmental impact study under way. extended a further year, or perhaps rather more. looming crisis hanging over one of the country’s The project is employing about 150 people diThe most vulnerable project appears to be most important investors—Australian gold giant rectly and as contractors.

Hidden Valley, where production started in Newcrest.

O’Neill has offered assistance to beleaguered September 2010, and where the company has Within just 18 months, the gold price has fallen Newcrest “to help ensure operations continue”. planned to invest heavily to ramp up its annual almost 30 percent—raising questions about the His statement indicates his concern about production from last financial year’s 178,000 viability of mines whose cost of production is Newcrest’s troubles infecting the PNG economy, ounces of gold and 1.7 million ounces of silver, high, and of gold projects being finalised, which just as he is presiding over its most expansionary to 250,000 ounces of gold and up to 3 million will now take too long to repay their construcever budget. ounces of silver. tion cost.

The company’s share price has almost halved This is why Prime Minister O’Neill, whose The fall in price of 2013 budget boosted other commodities is spending by almost 30 also threatening the timpercent, moved so swiftly ing, size and viability of to offer backing to the other mining projects in troubled Australian gold the Pacific region. giant.

Newcrest, the world’s He said: “Clearly, fourth largest gold miner Newcrest is facing some after Newmont, Barserious challenges with rick and AngloGold, its projects, including owns the Lihir gold those in PNG,” resulting mine in PNG’s New in part from the fall in the Ireland province, which gold price. it bought three years He said the governago for US$9.5 billion, ment would seek a briefand in a 50-50 joint vening from Newcrest’s ture with South Africa’s management on the imHarmony Gold, it is the pact on the PNG projects, operator of the huge with a view to ensuring Wafi-Golpu gold-copthey remain “fully operaper-silver prospect and tional”. the Hidden Valley gold He said: “The comand silver mine. pany is highly regarded It also has operations as a leading participant in PNG’s Peter O’Neill (left)…“when a company as big as Newcrest faces serious problems, we have to be concerned in Australia where it at the possible impact on our resource sector and our economy generally.” Photo: Lisa Williams-Lahari our resource sector. The is based, in the Ivory decline in the gold price Coast, in Indonesia, and in particular, and other in Fiji—where it owns commodities in general, about 70 percent of the in 2013, much of that fallare impacting on Newcrest. When a company Namosi project, in the ing around the time the as big as Newcrest faces serious problems, we mountains 30km northcompany announced it have to be concerned at the possible impact on west of Suva. Japanese would have to write down our resource sector and our economy generally.” companies Mitsubishi about A$6 billion—mostHe said: “The principal role of the national and Nittetsu Mining, ly coming from the Lihir government must be to maintain a sound climate with just two percent, mine, which it bought for investors—and especially, major resource own the rest. before the current maninvestors who are spending billions developing For 40 years, Namosi agement took control. our resource sector. has remained only a While PNG’s current “As Moody’s ratings agency recently conproject—with the prime economic growth spurt firmed, we are delivering the right climate for target, the Waisoi copis being driven chiefly by investors. In the meantime, we will get a briefing per-gold deposit, which ExxonMobil’s construcfrom Newcrest, and be open to consider what would be mined by open tion of the country’s first assistance and support might be offered.” cut. The huge miner Rio liquefied natural gas plant, The A$1.4 billion Ramu Nickel mine, being Tinto held the prospect its longer term sustainoperated by China Metallurgical Group Corpofor several years. ability as a major global ration, is benefitting from a—so far unique— Prime Minister resource centre hinges 10-year tax holiday, but there is no indication Voreqe Bainimarama heavily on the developfrom Port Moresby that the government’s offer said 18 months ago that ment of the next generaof support extends to financial concessions.

Could infect PNG’s economy

“When a company as big as Newcrest faces serious problems, we have to be concerned at the impossible impact on our resource sector and our economy generally.”

Islands Business, July 2013 27

Business

Port Vila market...Vanuatu given more time by the EU. Photo: www.pacific.clfg.org.uk

EU gives Vanuatu, Fiji time to address lax IUU laws Make improvements or be blacklisted

By Dionisia Tabureguci V anuatu and F iji have been given more time by the European Union (EU) to address loopholes in their national fishing laws that encourage Illegal, Unreported and Unregulated Fishing (IUU).

The two countries were part of eight third countries (non-EU countries that trade with the EU) cited by the EU in November last year for having weak laws to tackle IUU, and were subsequently given six months to make improvements or be deemed as “non cooperating” in the EU’s fight against IUU fishing.

In responding to questions sent by Islands Business, the Suva-based Delegation of the European Union to the Pacific said since the publication of the EU decision on November 15 last year, the European Commission has been working closely with the two countries to rectify the identified shortcomings.

“Tailor-made action plans have been agreed for this purpose over a period of six months and regular meetings and consultations have been held to discuss the progress.

“The commission is now, after six months, assessing the situation in these eight countries in order to decide how to proceed.

“Options are: (a) to proceed to a final identification as non cooperating country, where trade measures would then take effect; (b) to maintain the dialogue and give more time to complete the actions/rectify shortcomings or (c) to close the dialogue as no further action required (if all 28 Islands Business, July 2013

requirements, but this, said the EU has not happened.

“What the European Union Parliament’s fisheries committee discussed and approved recently is a proposal for amendments to the IUU regulation in the context to adapt EU legislation to the Lisbon Treaty, which deals with the procedure for listing countries not cooperating in the fight against illegal, unregulated and unreported fishing.

“This proposal still has to be discussed in the Council and finally agreed to by all three institutions.

Currently, no country is blacklisted and identified as non-cooperating.

“The decision of 15/11/2012 of the European Commission only informed the eight countries that they risk to be identified if they don’t address their significant shortcomings.

“This ‘pre-identification’ has no further consequences. Measures, including trade measures, apply only once a country has been definitely identified as non-cooperating.

“There were no other decisions regarding ‘blacklisting’ of specific countries,” the EU said.

The EU’s decision to yellow card Fiji and Vanuatu in the Pacific region, along with six others—Belize, Cambodia, Guinea, Panama, Sri Lanka and Togo—has to do with lapses in national IUU laws and their failure to comply with international laws against IUU. Fiji was flagged for not having laws to punish Fiji-flagged vessels and Fijian nationals engaged in illegal fishing in the high seas, as well as for failing to make available conservation data on tuna and other fish species caught in its waters, required of it as a member of the Western and Central Pacific Fisheries Commission (WCPFC). Vanuatu’s weaknesses are related to its non-commitment to tackle recurring incidences of illegal fishing by Vanuatu-flagged vessels in the high seas.

The Indian Ocean Tuna Commission (IOTC) had put two Vanuatu-flagged vessels on its IUU list at different times and this, said the EU, was an indication that Vanuatu had failed to carry out its responsibilities effectively to comply with stock conservation and management measures put in place by such regional fisheries management organisations.

To help them achieve targets in their action plans, the EU has provided assistance in capacity building, in monitoring, control and surveillance, which will help Pacific countries to ensure formulation and effective enforcement of their fisheries policies and legislation.

For the first time, a fisheries attaché has been appointed to the European Union’s Delegation for the Pacific. “This will improve and facilitate the communication between the EU and Pacific countries, not only in the subject of IUU, but in other bilateral and regional fisheries issues within the Pacific region,” the EU said.

Fiji was flagged for not having laws to punish Fiji-flagged vessels and Fiji nationals engaged in illegal fishing in high seas.

shortcomings were rectified).

“The whole process is still going on and confidential,” the EU said.

So far, the EU has been happy with the progress made

by Fiji while it has yet to decide on Vanuatu.

“For some countries including Fiji, the Commission has already completed the assessment and congratulated the Minister of Agriculture, Fisheries and Forests for the good cooperation and progress made so far.

“Fiji has, amongst other actions, revised and published a new fisheries management decree (No.78 of 2012), which is fully in line with international standards and appropriate for efficiently combatting IUU fishing.

“The commission proposes therefore a prolongation of the dialogue process for nine months, so Fiji has time to complete its actions and prepare for the implementation of the new decree.

“After that period, an evaluation of the dialogue will be done. The decision regarding Vanuatu is still pending and will be taken after completion of ongoing discussions.”

Recently, reports in the overseas media regarding the eight countries said they had been blacklisted for non-compliance to EU’s IUU

Business

PNG influence in Samoa Lamana to build a US$50m hotel project

By Merita Huch

while sAmoA mo continues to debAte moA A Ate the growing influence of Chinese businesses in the country, one group has been welcomed with opened arms by the Samoan government.

The Lamana Group of Papua New Guinea has officially begun work on a man-made island in Apia.

It’s the first foreign business group that’s stayed true to its commitment to invest in Samoa.

Many foreign investors had forwarded proposals to build international hotels on this island at Moataa, just a couple of minutes away from Apia town area. So when the PNG company’s proposal was first made public two years ago, it was met with scepticism, not just from government but also from the business sector.

Many shrugged the proposal off—Taumeasina was becoming a laughing matter every time an investor showed an interested on the place.

Even government wasn’t so excited about it, “waiting to see if this group from PNG would return” as Prime Minister Tuila’epa Sailele Malielegaoi recalled.

It took a year for the team to return and finalised its commitment but even then, there wasn’t much interest pulled into the investment.

The government was becoming all too PM TuilaÕep a...happy with the PNG company. Photo: familiar with the routine. Investors would Merita Huch come to Samoa, set out their demands and wishes to ensure their stay is as comfortable as possible and then leave never to be seen again.

In June, Lamana’s commitment was endorsed with the groundbreaking ceremony, bringing to Samoa the managind director of this construction development company, Kostas Constantinou.

Tuila’epa was grateful to the PNG company for investing in the country. Their project, the Taumeasina Resort, is a US$50 million development which will include 70 hotel rooms, 30 villas including restaurants and conference areas, cafeterias and entertainment facilities.

This PNG group is a privately owned property developing company based in Port Moresby. Since its establishment in 1994, it centres its work on building luxury apartment units and commercial office buildings as well as hotels in Papua New Guinea and around the Pacific.

For Samoa, it appears that so many US, European and Asian business groups bring promises of similar major investments in the country but with little results.

The only solid deals have come from within the region with Tanoa Tusitala owned and run by the Tanoa Group from Fiji, and now the latest project has come from Papua New Guinea with the Lamana Group.

The Taumeasina Resort is expected to open for business next year.

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Islands Business, July 2013

Business

Tuvaluans…benefitting from its fortunate domain name. In 2 0 0 0 , t h e Tu va l u government negotiated a contract with dotTV to lease the domain name for US$50 million in royalties, plus a payment of US$1 million per year.

Moreover, Tuvalu owns 20% of dotTV. Photo: SPREP

Snazzy domain names benefit facebook, google... …And some small nations like Tuvalu

By Josh Wolonick If you’ve ever used the Internet while travelling abroad, you know that different countries have specific country code domain names, like “.uk” for the United Kingdom, “.jp” for Japan, “.fr” for France, and “fj” for Fiji, replacing the .com at the end of an URL. These are called country code top-level domains (ccTLD) and they can be used by companies anywhere in the world, with royalties and rights going to their countries of origin.

When it comes to such domain names, some countries are luckier than others. For example, the country code domain of Libya is .ly, which has become a popular domain name for urlshortening sites all over the Internet.

As unique and catchy domain names become more popular and marketable, some countries (many of which happen to be small or islands nations), including Montenegro, Tuvalu, the Cocos Islands, the Federated States of Micronesia and Libya, are capitalising on the happy accident of receiving an interesting or economically desirable domain name. .me In 2006, the Parliament of Montenegro declared independence from Serbia. That same year, it was awarded the .me country code.

Montenegro’s government obviously understood the potential boon of the .me domain, and so began an auction of it immediately.

The company Domain.me won the rights to the contract in 2008 and has operated the domain ever since. Part of the contract stipulated that Montenegro would receive a percentage of the sale of all domains.

According to Domain.me’s Head of Marketing Natasa Djukanovic, in the first five years of the deal, Montenegro made 13.2 million Euros (equivalent to US$17.27 million).

30 Islands Business, July 2013

Several big companies like Facebook (FB), Visa (V), and Google (GOOG) use .me domain names, to shorten their URLs (fb.me, v.me and g.me, respectively).

Moreover, the most memorable website URLs tend to be short and catchy: companies are betting that the .me domain, with its connotations of personalisation and individuality, fit that bill.

As Djukanovic told Minyanville, “.me domains are personal, memorable, and create an instant connection between companies, startups, or individuals and their customers or users.”

On May 16, Domain.me announced it was releasing five premium domain names: around. me, hire.me, fund.me, find.me and for.me.

There was a competition going on which ended on June 15, wherein businesses and startups could submit proposals and applications declaring why their company and brand would be the best to bear the new domains. .tv Fortunate to share its name with the abbreviation of television, the Polynesian island nation Tuvalu’s country code top-level domain is .tv.

Located halfway between Australia and Hawaii, with a population of 10,544, Tuvalu is the third-least populous sovereign nation in the world, behind only the Vatican City and Nauru.

Moreover, its physical land size is approximately 10 square miles.

This small state benefits mightily from its fortunate domain name: In 2000, the Tuvalu government negotiated a contract with dotTV, a subsidiary of Internet infrastructure services company VeriSign (VRSN), to lease the domain name for $50 million in royalties, plus a payment of $1 million per year. Moreover, Tuvalu owns 20% of dotTV. In 2006, VeriSign joined forces with content and social media firm Demand Media (DMD), operator of eHow and Cracked, to promote .tv as

a the top-level domain name most preferred for Internet video content. In 2010, the domain name and website marketplace Sedo partnered with VeriSign to sell 115 premium .tv domain names.

Often, .tv websites offer video content for specific brands that already have .com sites, including mlb.tv, Mercedes-benz.tv, and mtv.tv.

Additionally, the youth-oriented marketing firm Vice has received contracts from Dell (DELL) and Intel (INTC) to create brand-tailored .tv content stations. .cc A favourite with cycling clubs and retailers (rapha.cc), Christian organisations ( ctk.cc ) and even Canadian Club whisky at one time, .cc is the country code top-level domain for the Territory of the Cocos (Keeling) Islands, a territory of Australia located in the Indian Ocean, about halfway between Australia and Sri Lanka.

The domain name has been operated since 1997 by eNIC, a VeriSign subsidiary that markets .cc as “the next .com”. Along with SamsDirect Internet, eNIC has made .cc one of the most popular alternative domain names in the US. A great deal of the domain’s success is owed to SamsDirect’s partnership with Clear Channel Communications, America’s largest radio broadcaster, whereby the .cc domain was promoted on several hundred radio stations. .fm The country code top-level domain of the Pacific island nation the Federated States of Micronesia (FSM), .fm is popular and economically valuable to FM radio stations and streaming audio, a notable example being music recommending website Last.fm.

The domain is operated by dotFM, a subsidiary of San Francisco-based multimedia and e-commerce company BRS Media Inc (the company has another subsidiary dotAM, which operates the top-level domain of Armenia).

Through dotFM, anyone can register a .fm domain for a fee and much of the income from the sales goes to the people of FSM and their government. .ly The country code top-level domain of Libya, .ly is run by the registry Nic.ly and is sponsored by the General Posts and Telecommunication Company, a state-owned organisation formed in 1984 that oversees all post mail and telecommunication in Libya. Nic.ly operates by appointing certain registrars to offer .ly domain names to businesses across the world.

One of those registrars, Libya Telecom & Technology, founded as a private company in 1997

by Muhammad Gaddafi himself), pioneered the proliferation of the .ly domain name.

Though the domain is mostly used by the public in Libya, many URL-shortening websites use the domain name, including brief.ly , adf.ly , and ow.ly . (The popular site Bit.ly changed its name and domain to Bitly.com in 2011, to avoid issues with the Libyan government.). In addition, many of the Libyan domains were reserved for words in English that end in ly, like name.ly, sincere.ly, and sil.ly.

• Follow Josh Wolonick on Twitter: @JoshWolonick and @Minyanville. Minyanville Media, Inc. is an Internet-based financial media and publishing company—http://www.minyanville.com

Business Profile

Fighting corruption in PNG Sam Koim on the front line Koim was aware of these concerns, and acknowledged that any new anti-corruption institution could potentially ‘divert government For those on the front line, fighting corattention away from existing agencies, or cause ruption in Papua New Guinea can be a dangerous territorial conflicts [between agencies]’. occupation. It wasn’t that long ago that a former However, he was adamant that an ICAC could Ombudsman Commissioner was shot. be effective if it was ‘appropriate for PNG’. This Sam Koim, chairman of PNG’s anti-corrupmeant that any new institution should integrate tion coordinating body, Taskforce Sweep, knows into existing government systems and reflect all about the dangers that come with the job. local values.

In February this year, his office was ransacked.

Koim warned against importing an ICAC In a video footage of the aftermath, Koim looks model—such as those from New South Wales down the camera lens in defiance; he asserts that or Hong Kong—without considering the local the incident will not deter him or his team. context. To account for local complexities, he The office of Taskforce Sweep was targeted said that moves to install a new anti-corruption because of its success. It has registered over 200 organisation must slowly cases of corruption, and evolve. recovered over 68 million Asked to reflect on the Kina (around A$32 milinitial achievements of Tasklion). force Sweep, he was modest, This has meant Koim saying that he would leave it has become somewhat of a up to others to judge. But celebrity, sought by the mehe was satisfied with the dia, researchers and policy ‘amount of deterrents that makers. Despite his busy are being created’. schedule, I managed to He noted that, ‘in the catch up with him while he past, people would do anywas in Geelong for a symthing and steal [with impuposium on PNG at Deakin nity]; but now they know University. that somebody’s looking This blog post, based on over their shoulders’. our conversation, reports on While Taskforce Sweep Koim’s perceptions about has recovered stolen money corruption, the taskforce, and has helped with the new anti-corruption orarrest of suspects, its conganisations, the challenges viction record is yet to be facing anti-corruption orSam Koim...fighting corruption in PNG. Photo: established. ganisations, solutions and ANU’s Development Policy Centre On this front, Koim the road ahead. hopes that he and others Taskforce Sweep is a can learn from Indonesia’s multi-agency taskforce that anti-corruption commiswas established by the nasion, the Komisi Pemberantasan Korupsi (KPK). tional government of PNG in August 2011.

Until recently the KPK had an impressive 100% Initially set up to investigate allegations aimed conviction rate for corruption cases. at the Department of National Planning, the Australian media has quoted Koim as saying taskforce’s mandate was subsequently extended that half of PNG’s 7.6 billion kina development to cover other government departments. budget was lost to corruption between 2009 Koim told me the government recently agreed and 2011. to support Taskforce Sweep until arrangements Even with the difficulties of measuring corrupfor a new anti-corruption institution are decided. tion (corruption is conducted in secret, making As outlined in PNG’s National Anti-Corrupthe extent of the problem difficult to gauge), this tion Strategy 2010-2030, this new institution is estimate is astounding. likely to be an Independent Commission Against Why has corruption become a problem in Corruption (ICAC).

PNG? In response, Koim linked corruption to Establishing an ICAC in PNG is not a new inequality. Seeing, reading and hearing about idea. In the late 1990s, a proposed Organic Law money in the midst of poverty brings about ‘fruson the Independent Commission Against Cortration’, that means many Papua New Guineans ruption failed to win parliamentary support. don’t feel compelled to play by the rules, he said.

There is still concern about creating an ICAC He added that, as an ‘inclusive society’, many in PNG: some fear it would suck resources from people benefit from corruption, which means established anti-corruption organisations, such they are less inclined to speak out against it. He as the highly regarded but poorly resourced was particularly concerned about the pressure on Ombudsman Commission.

By Grant Walton*

government workers to provide for their wantoks—literally ‘one talk’, a system of obligation between kin—means many public servants look for ways to augment their salary.

The Australian press also heavily publicised Koim’s concerns that Australia had become the preferred destination for money gained corruptly—in October 2012, he called Australia the Cayman Islands of PNG. Koim didn’t back away from these comments.

But he did say he’s been happy with the way Australian officials have worked with him and his team since his speech.

While wary about revealing details, he suggested that Australia is now doing a better job of identifying suspicious transactions from PNG and monitoring those accused of corruption.

This is perhaps evidenced by the recent seizure of businessman Eremas Wartoto’s Queensland property by Australian authorities, and the cancelling of his 457 visa. Wartoto is accused of misappropriating more than A$30 million from the PNG government.

No discussion about corruption in the country would be complete without exploring PNG’s multi-billion kina question: what is to be done?

Koim believes that corruption can be curtailed in PNG through three interlinked strategies.

First, there needs to be greater focus on training honest public servants about the principles of good governance. Second, he wants to see government departments better coordinate their anti-corruption responses.

And finally, he would like to see legislative reform. As outlined in his speech during Deakin’s symposium on PNG, he believes that laws need to be revised to better reflect PNG’s diverse cultures.

He would also like to see a stricter enforcement of the country’s Proceeds of Crime Act 2005—an act that was considered ineffective by 2011 report by the World Bank and the Asia/Pacific Group on Money Laundering.

But all this, he suggests, will require political will, resources and incentives. In PNG, government departments and politicians need to actively support anti-corruption reform.

He called for Australia to provide more money for anti-corruption initiatives. He also suggested that Australia conditions its aid by allocating money to PNG based on the PNG government’s willingness to tackle corruption.

There’s not doubt that Koim and his team have achieved much despite the dangers associated with anti-corruption work in the country.

Onlookers wait to see if these efforts translate into convictions and what role Australia and other donors will play in supporting anti-corruption efforts in the future.

As he suggests, if PNG does decide to establish an ICAC, it is critical that support for this new institution, through donors and the government, does not undermine existing anti-corruption efforts.

It is also important that this organisation be free from political interference and be able to reel in the big fish—those at the top of the corruption food chain—no matter who they are.

In the meantime, Koim and his team continue their fight against corruption. It’s a tough job, but someone has to do it.

• Grant W. Walton is a Research Fellow at the Australian National University’s Development Policy Centre (http:// devpolicy.anu.edu.au).

Islands Business, July 2013 31

Health

Promoting condom use...young people from Chuuk State, Federated States of Micronesia. Photo: SPC

Sexual health and wellbeing Recasting response to HIV and other STIs

By Secretariat of the Pacific Community Epidemic levels of sexually transmitted infections (STIs) and increasing numbers of new HIV infections, coupled with the winding down of two major funding streams for HIV and other STIs in the Pacific, have spurred Pacific health managers and development partners to investigate how to sustain gains made to-date in HIV prevention and control.

HIV rates are low in all Pacific Islands countries and territories (PICTs) except Papua New Guinea (PNG). However, there are high levels of other STIs such as chlamydia, gonorrhoea and syphilis.

It is estimated that fewer than 0.1% of adults aged between 15 and 49 had HIV in the 16 PICTs reporting people living with HIV at the end of last year, excluding PNG. Yet in some PICTs, up to one in four pregnant women and one in five young people have chlamydia, an infection that can permanently damage reproductive organs if left untreated. Like other STIs, chlamydia leaves Pacific people increasingly vulnerable to HIV. The Pacific Regional Strategy on HIV, which was endorsed by Pacific Islands Forum leaders, aims to help Pacific Islanders protect themselves from HIV and other STIs. The Secretariat of the Pacific Community 32 Islands Business, July 2013

ministries of health are driving the discussion with regional partners and donors on the future direction of STI and HIV programming.

Regional consultations were held with Pacific Island HIV/STI and health managers in March.

The 17 participating PICTs called unanimously for renewed commitment to a shared agenda and unified regional response to achieve zero new HIV infections; reduce STI prevalence; and tackle the gender, social and cultural norms that drive STI transmission.

Looking ahead, many PICTs advocate an all-inclusive approach to sexual health and wellbeing, while retaining a focus on halting the spread of STIs including HIV. Such an approach would include stronger integration or linkages between the various reproductive health programmes delivered by health ministries; greater focus on non-health sector determinants of sexual well-being, such as gender inequality, human rights and youth unemployment; and targeted programmes for groups at greater risk of contracting STIs, including HIV. For the person in the street, such an approach might translate into a one-stop-shop for contraceptives, STI and HIV testing and treatment, counselling and sexual and reproductive health care, with additional services provided through a referral system.

In contrast, under the present approach in some PICTs, HIV and STI services have become disconnected from broader health programmes.

Efforts to link and integrate HIV and sexual and reproductive health have the potential to increase uptake of key services, and improve quality of care and use of scarce human and financial resources. They are also in keeping with the push to strengthen health systems and enhance aid and programme effectiveness.

The latest epidemiological evidence from the Pacific supports linking or integrating HIV and STI programming into more holistic sexual and reproductive health services, though it also indicates the importance of staying focused on populations at higher risk of HIV infection, including uniformed personnel, seafarers, sex workers, men who have sex with men, and teenagers, who are not often reached by mainstream health services.

This is crucial until broader health systems are accessible and sensitive to everyone’s needs. HIV data from French Polynesia, Guam and New Caledonia are strong reminders of the importance of continuing to target at-risk groups. In these PICTs, the latest data show that more HIV transmission is due to sexual contact between men than to heterosexual contact.

The refocusing of the HIV and STI strategy is also in line with the SPC Public Health Division’s effort to deliver high-quality essential public health functions and strengthen the way they deliver health services.

The division’s new strategy centres on three priority areas where it can add most value: NCD prevention and control; STI prevention and control, including HIV/AIDS; and communicable disease surveillance and response.

The Pacific Regional Strategy on HIV aims to help Pacific Islanders protect themselves from HIV and other STIs.

(SPC) coordinates the implementation of the regional strategy.

The Pacific HIV and STI Response Fund, funded by the Australian and New Zealand governments, supports implementation of the regional strategy. It addresses HIV and STI prevention; early HIV and STI testing and diagnosis; and treatment, care and support.

The strategy also focuses on leadership and creating an enabling environment; strategic information and communication; and governance and coordination. By the end of last year, over A$53 million had been delivered to the region for HIV and STI programming through the Pacific HIV and STI Response Fund and The Global Fund to Fight AIDS, Tuberculosis and Malaria.

This investment has improved the ability of PICTs to address HIV and other STIs. The reduction in chlamydia prevalence in some PICTs is particularly noteworthy, as is the increase in condom use. However, the momentum needs to be sustained.

With both funds closing this year, Pacific

Tourism/Aviation

Affluent Chinese... shopping for high-end brand names. Photo: Chinese Daily

What affluent Chinese tourists want?

Exploring options to tap this new market

By Davendra Sharma Everyone talks of more trade ties or aid handouts from China but few in the region are serious about luring the big-spending Chinese tourists, considered by experts to be the fastestgrowing US$85 billion market in the world.

Overseas-bound tourists from China hit a record 83 million last year and travel agencies expect the number to soar to 94 million in 2013—the most external travel by any country—as tourism operators world-wide explore options to accommodate their tastes.

Rich Chinese tourists prefer Shangri-La hotel chain and they love shopping—they mainly clamour for high-end French brands such as Louis Vuitton, Hermes, Chanel and Cartier.

The Hong Kong Chinese-owned ShangriLa with five-star lodgings has top-end market hotels in Middle East, North America, Oceania and Europe.

The China Daily newspaper last month observed that Chinese travellers spend US$85 billion in outbound trips in countries which catered for their preferences—reading, tea-tasting, driving and spending time with family, in that order.

Tourist numbers to the islands region are minimal with only Fiji noting a significant rise in arrivals over the last decade since China carved a reputation to become a world economic superpower—the second largest economy behind the United States.

Just five years ago—only 4,087 Chinese nationals, a minute 0.8% of total arrivals, called into Fiji but that number soared to 25,000 last year.

It follows special deals and initiatives by Air

Pacific, now Fiji Airways, to fly into Hong Kong and the Papua New Guinea-based Bank of South Pacific linking their debit card with China’s UnionPay, which has customers exceeding 3.1 billion customers. Chinese tourists now also enjoy on-arrival visas.

UnionPay is China’s biggest international debit card agency with recent dealings extending to Australia’s Commonwealth Bank.

Just as ethnic Chinese-owned businesses are on the rise around the islands region, so too are those seeking permanent residency. Countries like Australia, New Zealand, PNG, Solomon Islands, Tonga, Fiji, Vanuatu and Samoa have ethnic minorities of Chinese descent among their populace.

Some estimates have put 80,000 “overseas Chinese” in the islands region with around 20,000 each in Fiji and PNG. Affluence in China Increasing export-import trade and new Sino investments in Vanuatu and PNG have attracted Chinese to prolong their stay in the two countries in recent years.

A report out in June points out that there are 600 billionaires in China and 2.8 millionaires—all supposedly driving the outbound travel markets from the mainland and Hong Kong.

If the islands regional tourist operators do not tap into the mega-rich Chinese tourist market, the region will miss out on the world’s big spenders.

Unlike the islands countries, Australia through intensive campaigns has managed to woo Chinese tourists in droves. It has noticed a rapid growth in

tourist arrivals from China in the last four years, when the numbers from recession-hit United States and Europe began to drop.

Arrivals this year indicate that the Chinese have surpassed the British in terms of arrivals of holidaymakers in Australia.

Ethnic Chinese living in China, Singapore, Malaysia and Taiwan who chose to holiday abroad last month accounted for nearly half of the tourists into Australia.

Asian tourists who visit Australia often also choose one of the islands destinations as a secondary part of their itineraries.

But the Chinese tourists need to be convinced that they get what they expect from their holiday spots.

Costs and currency exchange value are not so much an impediment to Chinese travellers, as announced by Tourism Research Australia chief economist, Leo Jago.

He declared that Australia noticed a five percent annual increase. “Results like these are clear indications of the ongoing growth of the Asian market and continuing recovery of some of the traditional markets,” he said in a statement.

For Australia, the biggest growth comes from China, with visitor numbers increasing by 17 percent, followed by Singapore 13 percent, Malaysia and Taiwan 12 percent, and the United States and India seven percent.

A study on social habits of the luxury Chinese travellers reiterated that France(because of its designer brand names), US, Singapore, Switzerland, the UK and Italy have all become popular holiday stops for the Chinese.

Chinese biggest spenders The Hurun Report, released at Shanghai’s annual International Luxury Travel Market in June, cautioned countries eager to attract tourists from China to be wary of what they have to offer.

Shanghai-based Hurun Report chairman Rupert Hoogewerf said travel authorities need to prepare “luxury consumer” markets.

He said the Chinese are the highest spending visitor market in the world but for individual or a group of countries to appeal to them they must offer what they solicit.

The French link of such countries as New Caledonia, French Polynesia and Vanuatu have made their holiday destinations more attractive than perhaps other island choices for Chinese visitors seeking French labels.

Vanuatu still records greater arrivals of holidaymakers from Australia (70%), New Zealand and New Caledonia, followed by China.

Known for the region’s eco-tourism, adventures and nature appeals like waterfalls and reserves, Vanuatu has failed to lure Chinese in as many numbers as it would have liked to.

The same can be said about PNG, which armed with a new Tourism Promotion Authority and an expensive national budget strategy, has only seen a rise in tourist numbers from Australia, North America and Japan because of its appeal for Kokoda Track.

Chinese consumers have become increasingly affluent on the back of an economic boom and foreign holidays are ever more popular, with shopping a key activity.

There have been suggestions that the rapid expansion in China’s middle class will no doubt see this trend continue for years to come in the near future.

Islands Business, July 2013 33

Tourism/Aviation

Samoan souvenirs...for sale. Photo: Glenn Baker

Samoan tourism in crisis?

Operators suffering, bureau doing little

By Jason Brown Samoan people are starting to think the unthinkable—that the region’s longest running administration might be on shaky ground.

“Why not get a new PM,” asks Lotte Chan Mow, a Samoan woman living in New Zealand.

“How about stop worrying about these casinos and worry about the state of our country?,” she says, commenting on Facebook about news that a group of Chinese investors was demanding a jaw-dropping list of concessions—including a 160-year lease and the right to bring in 30,000 workers.

Criticism is nothing new for a government that has pushed through a succession of controversial law changes.

Moving the dateline and changing road lanes drew mass protests over the last few years; both saw unprecedented opposition.

Obscured by these headline decisions were significant changes to land laws and identity clauses, causing deep disquiet among legal experts.

But it was a perfect storm of controversy last month that saw previously unheard of reversals from Prime Minister Tuilaepa Sailele Malielegaoi.

First, there were revelations that the minister of finance had spent T$600,000 (tala) fixing his office—a second round of refurbishments for an already plush post.

Second was outrage over a cabinet decision to dump T$1.8 million of architectural plans for a new market—leaving farmers literally holding their umbrellas out in the beating sun and driving rain—along with millions in other failed infrastructure projects.

34 Islands Business, July 2013

Third saw an investor for a much boasted 500room casino project arrested in Hong Kong on corruption charges.

Fourth, fifth, sixth and seventh scandals were a mix of leaks and lassitude—an expose by a news site, Talamua, of a second Chinese investor group with an outrageous wish list; “advice” from the prime minister for Samoa police to stop holding a popular weekly press conference; continued electrical failures despite T$91 million invested in a new power station; another leak that saw newspapers printing a copy of an official Tuilaepa letter that contained remarkably colourful abuse, and...where does one stop?

Probably with the two reactions from a man of previously impregnable glibness, the prime minister himself.

Responding to a sense of genuine shock in Samoa, Tuilaepa went on the offensive, dismissing the second Chinese group as part of a history of “stupid companies” and “crooked palagis”— foreigners—who constantly show up seeking heaven and earth.

More tellingly still, Tuilaepa reversed his earlier “advice” and was quoted by Radio New Zealand International as having “instructed” Samoa police to start talking to the local media again.

It’s a policy flip flop that Tuilaepa only partly follows himself, pointedly ignoring a series of email questions and fobbing off most interview requests.

Local daily newspaper Samoa Observer mocked Tuilaepa mercilessly for his weekly appearances on normally cowed TV stations, repeatedly describing in Samoan the newspaper as full of “idiots”, along with any other critic.

Standard political theatre, perhaps.

Samoa Observer staff and others confirm that they’ve never seen the prime minister back down before, on anything, however.

What may have shoulder knocked the PM more than anything else was open talk of a ‘crisis’ in tourism.

Previously hushed, if not angry whispers about a fatly overstaffed tourism office doing little to effectively market Samoa overseas, or educate smugly dismissive village leaders about the worth of visitors broke, for the first time, into the public domain.

“There is a crisis”, says Luna Marsters-Paul, a Cook Islander who has seen her own country labour through a similar process.

She pointed to her own boutique hotel of just 12 rooms and asked why she had such difficulty gaining enough bookings.

She was joined by Francois Martel, a French Canadian who had been shoulder tapped by Tuilaepa to report on the true state of the industry.

As foreigners they may appear easy to dismiss but both hold long history in Samoa, earning unqualified respect locally as deeply committed residents.

Martel, particularly, is known as the husband of a ground-breaking woman, Zita, adored for taking a team from a school of hard knocks and turning them into race champions at the annual fautasi (long boat) races—races that had previously only been captained by men—and attract thousands of people to the capital’s waterfront.

Martel praised a tourism board member for publicly admitting that tourism operators were suffering, saying the admission brought government and the industry back onto the same page.

Seeing her own comments in black and white however, brought a hurriedly horrified disavowal from board member Seumanuula Moana Clarke, hotly disagreeing that her admission meant she was “breaking ranks” with the prime minister.

So is there a crisis?

Official figures from the Central Bank of Samoa lauded an increase in tourism arrivals month-on-month, quietly coughing an aside that tourist figures had fallen—28% from the year before.

Meanwhile, Samoan Tourism Authority cheerily released another newsletter celebrating minor triumphs on the local activity scene.

Insouciance unwelcome in an industry facing very real demands for loan repayments from banks threatening to close down properties that the government had, just two years previously, convinced many to build ahead of the 50th anniversary celebrations.

Drop in arrivals is a natural hangover from unprecedented anniversary year tourism levels.

What may be the strong indicator of cracks in the fortress Tuilaepa however, is a simple collegial courtesy.

Having filmed outraged denials from Seumanuula, a local TV station politely emailed a daily newspaper for their side of the story.

Now that? That has definitely never happened before.

Tourism/Aviation Briefs Bigger passengers

Samoa Air which made headlines this year when it introduced a pay-by-weight fare system, is in the process of installing a special seating place for bigger passengers.

Chief executive Chris Langton told the New Zealand Herald that: “We’re in the process of changing the space between the seats. What we’ve done is created what we call the executive row, where they’ve got an extra 14 inches (35cm) between the seats. There’s also a ramp so people have easier access. They’ve got added space as there’s no [arm] rest between the seats. It’s basically like a two- or three-person sofa,” he said.

Cooks to decide

The Cook Islands Government is to decide whether to continue underwriting NZ$12 million for Air New Zealand’s flights to Los Angeles and Sydney.

The three-year agreement is coming to an end at the end of the year and so a financial analysis is being done to see what benefits there are for the country and whether the routes are paying for themselves. The government has also put out expressions of interest to other airlines to see whether they have any interest taking over the routes.

New Dash 8

Air Niugini has a new Dash 8. It will be used for its commercial routes and mining charter service operations, according to the airline. The Dash 8-315 series aircraft under the Papua New Guinea registration P2-PXL was flown in from North Bay, Ontario, Canada, to Port Moresby.

Hello Fiji Airways

From this month, Air Pacific will be known as ‘Fiji Airways’. Returning to its 1958 name, the switch-over marks another important milestone in the airline’s turnaround. The new identity will involve exciting changes to the customer experience, uniforms and the airline’s new website.

“At the heart of our airline’s new name and brand is the Fiji Airways’ brandmark, a striking new masi design, created by celebrated local Fijian masi artist, Makereta Matemosi. The brandmark symbolises the airline’s new identity and epitomises all that Fiji Airways represents. It is authentic, distinctive, and true to the airline’s Fijian roots. Fiji Airways will continue to be the country’s flying ambassador to the world, bringing the renowned Fijian hospitality to people across the globe,”said Aubrey Swift, the airline’s Acting CEO.

Boeing 787 production

Boeing has rolled out its first 787 to be built at the increased production rate of seven aircraft per month. The aircraft, which will be delivered to British Airways, is the 114th 787 and the 100th 787 to be built at the Everett, Wash., factory.

Boeing said the 787 programme is “on track to achieve a planned 10 per month rate by year end.” The production rate accounts for airplanes built at the Everett Final Assembly facility, the Everett Temporary Surge Line and Boeing S.C., the manufacturer said in a statement. To-date, 50 787s have been delivered to eight airlines. The programme has more than 800 unfilled orders with 58 customers worldwide, according to Boeing.

—Source: PACNEWS, Boeing

Oustanding issues to be thrashed out at ASPA Open skies study also to be tabled This year’s meeting will see a group of state officials from the Federated States of MicroneOutstanding issues regarding airlines in sia making an appearance to see how ASPA can the region will be discussed at the Association of accommodate their concerns for access to their South Pacific Airlines (ASPA) meeting in Nadi. remote islands.

ASPA Secretary-General George Faktaufon “Only Continental Airlines Micronesia which said contentious issues like air services matters beservices Guam to Asia, Australia, Micronesia tween Vanuatu and Fiji would likely be discussed and USA services these northern Pacific states,” during the meeting which will be held at Tanoa Faktaufon said.

International Hotel in Nadi from July 18-19.

“When the flight actually gets to FSM, it is Fiji terminated its codesharing agreement with already full and it is the sole airline on the route.

Vanuatu in December last year and also rejected For someone to travel from Micronesia to Fiji, an application by the Vanuatu government for they would have to fly to Honolulu to get there,” Air Vanuatu to codeshare with Solomon Airlines Faktaufon said. on the Honiara/Port Vila/Nadi/Port Vila/Honiara Faktaufon said nations like Tuvalu and Tonga service. This service is operated by Solomon which don’t have airlines often use the meetings Airlines on a Saturday. to discuss such matters.

Faktaufon said the latest discussions between “A lot of routes are uneconomical so there is Fiji and Vanuatu on this issue and other air sernormally an element of subsidy involved and they vices agreement matters looked bright. will get the best deal out of an airline,” Efforts to get comments from Air he said.

Vanuatu have proved futile. But Islands Faktaufon said the theme for this B usiness , however understands that year’s meeting is Business First, Safety at the ASPA meeting in Port Vila last Always—shifting the focus to the bottom December, former Air Pacific (now Fiji line of any business which is making Airways) CEO David Pflieger undertook money. to look into the matter after meeting Air “The reason we have this theme this Vanuatu and Solomon Airlines officials. year is that we have always been safety Solomon Airlines has also been trying driven and dealing with someone else’s to resolve its issues with Fiji Airways. George Faktaufon... needs while our own needs, to make Solomon Airlines is only allowed 20 seats m a k i n g m o n e y money, have been neglected,” he said. on the Fiji airline’s Honiara/Nadi flight on neglected. Photo: “We can be safe as part of our business ASPA Tuesday. This flight also flies via Port Vila. but if we cannot make money, then we Solomon Airlines also offered Fiji will not have a business to run. We will Airways codesharing on its flights on Saturday try to change the focus to making money with (Honiara/Port Vila/Nadi/Port Vila/Honiara). safety being an important part of that process.”

But Air Pacific cited IATA (International Air He said in the past they had prepared and inTransport Association) Operational Safety Audit vested time and money into awaiting for an audi(IOSA) as an issue. tor’s visit to show how safety-prepared they were.

IOSA is an internationally recognised and ac“What we have been trying to do is make evcepted evaluation system designed to assess the eryone 24 hours safe and not just showing they operational, management and control systems of are safe every time an auditor announces his visit. an airline and the airline has yet to receive this “An auditor should be able to walk in unanaccreditation. nounced and see that the aviation systems are Solomon Islands also offered to fly the Tuesday safe.” flights between Nadi and Honiara, currently Fiji Airways has also been invited to a session operated by Fiji Airways, so the Fiji airline could on open skies, which is expected to look at a study focus on the more lucrative flights, but this has it commissioned recently on the issue. also been declined.

Islands Business has been told the study Fiji Airways and Solomon Airlines have also will be the first for the Pacific and for developsought a joint approach to operate a Melanesian ing countries as similar studies have focused on route—Nadi-Port Vila-Honiara-Port Moresby, developed countries. but this has not generated much enthusiasm Open skies is an international policy concept from other airlines. that calls for the liberalisation of the rules and Faktaufon said both airlines (Air Vanuatu regulations of the international aviation indusand Air Solomons) were expected to discuss try—especially commercial aviation—in order such issues at the Nadi meeting with their Fiji to create a free-market environment for the counterparts. airline industry.

While the meeting proper would focus on isFor open skies to become effective, a bilatsues involving all airlines, they would get airlines eral (and sometimes multilateral) air transport that have contentious issues together at the meetagreement must be concluded between two or ing to discuss these matters. more nations.

By Robert Matau

Islands Business, July 2013 35

Tourism/Aviation

By Robert Matau

Tax relief, open skies deal with Singapore

tongA ong ’s Avi AviA viAtion Ation industry is looking bright with a tax relief for its locally-owned aircraft and an open skies agreement with Singapore.

Tonga’s Finance Minister Lisiate ‘Akolo announced in his 2013-2014 budget last month that his government would foot withholding tax obligations of the locally owned domestic airline REALtonga, totalling T$250,000 (approximately US$135,000) “because we have to pay their tax… they are new and still struggling and at the same time to assist tourism”. would lease the aircraft to REALtonga, which Tonga has also signed an open skies agreement took over the domestic market in March this with Singapore in May. year after Chatham Airlines pulled out, stating Transport Minister Samiu Vaipulu, who is also that the domestic market was not sustainable for the deputy prime minister, told two competing airlines. islA sl nds business that they would In the meantime, the local airline explore the Singapore option once has reinforced its seat capacity to help they complete the refurbishment of its domestic air services. Initially, the the runway at Fua’amotu Airport, airline will be using a Y12 aircraft to Tonga’s main airport and internaprovide additional services between tional gateway.

Tongatapu and Vava’u.

He said they have given SingaIt has also damp-leased a Convair porean airlines the opportunity to aircraft (a plane without an entire fly to Tonga. crew) from Air Chathams.

“We have not made any other This aircraft has a seat capacity commitments so far. But we are of 49 and will provide more than looking at the best option to deadequate capacity to cater for the velop our economy,” he said. peak tourism season (July to JanuVaipulu said they expect to re- Tevita Palu...damp-leased a ary), especially for the Vava’u and ceive a new 60-seat Xian MA60 Convair to cater for the July- Ha’apai markets.

January tourism peak season. turbo-prop aircraft from China Photo: Palu Aviation REALtonga’s CEO, Tevita Palu on July 4. said he was delighted his airline was Denying that the Tongan government has now in a position to offer much needed seats to bought shares in REALtonga, Vaipulu said it cater for the peak season.

TongaÕ s aviation on track

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“We are still in the process of finalising our longer term fleet and we are happy to be able to fulfill our commitments to ensure we provide enough seats for all our domestic air passengers.”

The airline’s commercial manager, Tele Faletau said the additional capacity obviously comes at an increased cost as well as a requirement for the airline to sell more seats to meet these costs.

He said to do this, the airline will be required to remove the two-fare structure that is currently in place and replace it with a single fare per sector (currently the Flexi Fare).

“This in turn will allow the airline to provide incentive commissions to agents and wholesalers around the world and also put lower fares into the market during lower demand seasons.

“The increase in capacity means the airline has been afforded the opportunity to review the baggage allowance for its customers and as soon as a larger aircraft comes into operation, the free baggage allowance will be increased from 10kg to 20kg for all passengers and there will still be capacity available to cater for the growing demand for airfreight to the islands.”

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GUADALCANAL 7TH AUGUST 13 - VETERAN’S DAY DAW SERVICE & WWII TOURS

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Islands Business, July 2013

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FOR INFO OR ASSISTANCE WITH ANY OF YOUR TRAVEL PLANS WHILE IN THE SOLOMONS VISIT OUR WEBSITE OR DROP INTO THE OFFICE

www.visitsolomons.com.sb Solomon Islands Visitors Bureau P.O Box 321, Mendana Avenue Honiara, Solomon Islands Tel : +677 22442 email: info@sivb.com.sb www.visitsolomons.com.sb

Tourism/Aviation

Poor runways take their toll...Air Marshall Islands’ single Dornier 228 lands at Utrik, which has a coral and grass runway typical of most outer island runways. Photo: Giff Johnson

Air Marshall faces difficult future Can govt keep bailing airline out?

By Giff Johnson The issue for the Marshall Islands government and its national carrier, Air Marshall Islands (AMI), is not whether the airline can make money. The answer to that question is known: it has not generated a profit in its 33 years of operations.

The challenge facing the airline and lawmakers is, can the government continue to afford to inject millions of dollars in subsidies each year to keep the airline operating at a time of increasingly stressed government budgets? Whether or not government can afford it, the answer to AMI has nearly always been “yes”.

During the last week of May, the government arranged a US$2.5 million bank loan so Air Marshall Islands (could pay the debt on its Dash-8 aircraft that has been undergoing heavy maintenance in the Hawker Pacific facility in Cairns, Australia, for over a year. The total price tag to fix the Dash-8 is now over US$4 million, including last year’s US$1.6 million down-payment.

Down to just a single 19-seat Dornier 228 and the Dash-8, which is expected back in July, the airline has struggled to follow a schedule.

AMI General Manager Jefferson Barton, a former secretary of finance who was appointed last year to run the airline, said the need for more than one Dornier to service this dispersed nation of coral atolls is obvious, as is the urgency of improving runways on remote islands. Coral and dirt runways are a cause of significant damage to the Dornier and Dash-8, the latter which Barton said will no longer be flown to unimproved runways when it returns in order to extend its life.

In the past, AMI flew the Dash-8 to a number of the larger unimproved runways in the outer

islands. But in view of the US$4 million cost to fix the Dash-8, the airline’s board has directed that it be flown only to the islands with paved runways, which include Kwajalein where the US Army’s missile range is and the nuclear-affected atolls of Bikini, Enewetak and Rongelap.

Barton would like to see the national government commit to an ongoing program of runway improvement over the next five years. “If we leave the runways in the same condition, then we’ll have the same problems (with the planes),” Barton said in mid-June.

“AMI needs the tools to provide reliable service, which includes airports. If we fix oneto-two runways a year, it will bring down our maintenance costs and improve service.”

Barton described some of the outer island runways as little more than “a small dirt road that I used to push a rearcart (wheelbarrow) on.

When the plane lands, debris is flying (that hits the plane) that can cause hundreds of thousands of dollars of damage.”

Until the mid-2000s, the airline operated with two Dorniers, which gave it flexibility and increased reliability for maintaining its schedule.

But for most of the period from late 2007 to mid2008, AMI’s two planes were grounded with a variety of mechanical problems.

Only one was fixed and put back into service and the result is shown in the airline’s operating losses.

A 2010 Asian Development Bank assessment showed that AMI had operating losses of US$17.4 million from 1999 to 2008. The pattern of operating losses have continued—US$1.2 million in 2010 and US$800,000 in 2011—with government subsidies a necessity to keep the airline providing

essential links to the outer islands.

In addition to getting runways improved, Barton would like to see AMI operating with three Dorniers, a goal that is probably beyond the financial reach of the government. Barton acknowledges that it is up to government whether to buy additional Dorniers.

Over the past year, some airline board members have expressed enthusiasm for purchasing a 25-year-old Dornier in Nairobi, a plane some have criticized as using older engine technology, not suited to the Marshall Islands.

The Dornier purchase plan will have to get the endorsement of cabinet, and President Christopher Loeak is not overly enthusiastic.

“AMI will have to convince the cabinet on the purchase (of the Nairobi-based plane),” Loeak said in mid-June.

He said he’s aware of the concerns about the plane’s engines, but confirmed the airline needs another Dornier.

“They need a plane to back up the existing one,” he said. There is a Dornier 228 in Germany that would be a better fit for AMI, but it comes with a US$3 million price, more than double the cost for the Dornier in Africa.

“It would be better for us, but I don’t know if we can afford it,” the President said a couple of weeks after endorsing a US$2.5 million loan for the Dash-8 repairs in Australia.

In April 2011, the Marshall Islands Chamber of Commerce sponsored a public forum on AMI and followed up the forum with a letter to government urging it to engage in more aggressive airline reforms.

It was one of many attempts over many years to push the government to address the privatization of AMI or putting it into a joint venture with the private sector. But this has never moved beyond the talking stage, and right now, the issue appears to be off the table.

In the meantime, Barton believes the way forward for the national airline is through a close partnership with government.

“This isn’t only for cash subsidies, but also for work on the outer island runways,” Barton said.

“Our responsibility is to get people to the outer islands. The government’s role is to have the infrastructure (runways) ready.”

Islands Business, July 2013 37

Tourism/Aviation

Cutting costs and remaining profitable The juggling act

By Geoge Faktaufon* the Airline industry is chA ch rA r cterised by low profit mA m rgins And high fixed costs, primarily for personnel, aircraft fuel, debt servicing and aircraft lease rentals.

The expenses of a flight do not vary significantly with the number of passengers carried and as a result, a relatively small change in the number of passengers or in pricing could have a disproportionate effect on an airline’s operating and financial results.

Accordingly, a minor shortfall in expected revenue could harm the business. In addition, the airline industry is highly competitive and is particularly susceptible to price discounting, because airlines incur only nominal costs to passengers occupying otherwise unsold seats.

Finding a balance to ensure yields are not unduly diluted is a major challenge for the airlines.

The economic disturbances in our major markets can affect inbound tourism, which is the driving force behind the success or failure of our airlines.

The airlines therefore need to rethink their business strategies and look at ways to cut costs in a difficult environment in order to remain profitable.

Moreover, there are many challenging human resources (HR) issues, engendered by the global competitive environment, including increasing competition for skilled workers, high cost of turnover of staff and demand for increased performance from staff.

These factors will force airlines to drive a new talent mindset in the organisation, upgrading their traditional HR strategies and processes.

In order to succeed in their challenging and globalised airline environment, there is an increasing need for airlines to adopt a “strategic people management and development” approach to ensure their workforce is focused on achieving organisational objectives and improving services to meet customer expectations.

New HR model In this new model, HR becomes a change agent in the organisation; the strategic enabler of people management processes that empower managers and employees while creating business value.

To help airlines improve their HR Management processes, ASPA (Association of South Pacific Airlines) has partnered with IATA to introduce the newly developed IATA People Management and Development for Airlines (PMDA) programme (developed by IATA in 2012 in response to industry needs).

The programme involves two one-week workshops carried out at the airline’s headquarters.

An IATA-funded facilitator guides the participants (carefully selected by the airline) in a series of processes leading up to the development of an Inhouse People Management Development System, tailor-made for the airline.

The first week is spent mainly on identifying the various HR management gaps and developing action plans to fill the gaps.

The facilitator returns in about two to three months to help the airline complete the PMDA system. We hope to complete the implementation of PMDA by end of 2014.

The PMDA programme addresses the following key strategic issues: • Organisation Linking the organisational structure to its mission, vision, values and objectives and developing clear roles and responsibilities for people in charge of Implementing the new People Management and Development System.

• Planning & Recruitment Explaining requirements and a set of organisational core competencies as well as the airline position—specific competencies, including knowledge, skills, experience and values that empower managers and employees, while creating business values.

An effective workforce strategy, integrated with overall corporate strategic plan, will help airlines ensure that they have the right people, in the right Islands Business, July 2013

places, with the right skills, at the right time.

The IATA Best Practice Guide on People Management and Development (PMDA) has been designed to provide a launchpad for organisational development, based on the industry’s best practices aiming to drive industry performance to new heights.

• Onboarding: Setting procedures (orientation programmes) to welcome new employees.

• Developing: Developing a skilled and competent workforce to meet business objectives.

• Performance Management: Managing Employee performance to facilitate the effective delivery of strategies and operational goals.

• Succession Management: Set up processes for identifying and developing internal people with the potential to fill key leadership positions.

• Employee Separation : Setting up processes to effectively handle the end of the employer/employee relationship, whether initiated by the employer or the employee.

• Communications: Setting up procedures to communicate organisational mission, vision, values, goals and rules for behaviour, as and when required.

Employees need to clearly understand what the organisation stands for, what kind of behaviour is encouraged and those that won’t be tolerated.

Communication is not a one way. In order to maintain a high level of ownership and commitment of employees, management needs to provide appropriate channels to listen to its employees, e.g. feedback boxes, employee satisfaction surveys, etc.

Expected Outcomes • Enhance overall airline people performance.

• Instill positive learning and development cultures in airlines.

• Ensure that airlines adopt best practice in talent management and run sustained and effective in-house learning and development programmes.

• Provide framework for airline training infrastructure to meet key organisational training needs and to serve as a catalyst for business growth.

• The People Management Development for Airlines, together with the Integrated Airline Management System provide a very viable solution for airlines to effectively manage their business (IAMS) and their people (PMDA).

• George Faktaufon is the secretary-general of ASPA (Association of South Pacific Airlines.)

Pacific Regional Tourism C a pa c i t y Bu il ding Pr og r a m m e

© David Kirkland

STRE NG T H ENING PA CI F IC E C ONOMIC I N TE G R ATION T H ROU G H TO UR I SM PACIFIC REGIONAL TOURISM CAPACITY BUILDING PROGRAMME Launched in January 2012, Pacific Regional Tourism Capacity Building Programme (PRTCBP) is a three-year component of the ‘Strengthening Pacific Economic Integration through Trade’ (SPEITT) programme, which is funded under the 10th European Development Fund (EDF) of the European Union. The programme will focus on the development of sustainable tourism by supporting a more conducive enabling environment for regional tourism growth through enhanced policy and capacity development as well as increased productive capacity and improved market access.

BENEFICIARIES The 15 Pacific ACP states (PACPs) of the Cook Islands, Federated States of Micronesia, Fiji, Kiribati, Marshall Islands, Nauru, Niue, Palau, Papua New Guinea, Samoa, Solomon Islands, Timor Leste, Tonga, Tuvalu and Vanuatu, benefit from the project. Within these countries, the key stakeholders are the National Tourism Organisations (NTOs) and Ministries of Tourism, Port Authorities, other tourism-related public sector bodies, tourism and hospitality training institutes, tourism industry trade association and tourism SMEs.

IMPLEMENTING AGENCIES The South Pacific Tourism Organisation (SPTO), the region’s apex tourism agency mandated by its public and private sector members to market and develop the region’s tourism sector is responsible for implementing this vitally important regional programme. It is designed around the three main result areas: KEY RESULT AREAS • Result Area One – Sector Planning and Policy Development, intended to enhance tourism strategic planning and enabling policies to improve the business environment and private sector growth: • Result Area Two – Market Research and Marketing, aims to increase tourism arrivals and foreign exchange earnings for the region through a market-led approach to tourism promotion and product development; and • Result Area Three – Human Resource Development and Capacity Enhancement, designed to improve human capital and enhance the quality and sustainability of regional tourism products and services.

SOUTH PACIFIC TOURISM ORGANISATION T | +679 330 4177 F | +679 330 1995 E | tourism@spto.org W | www.spto.org

Fisheries

Ban commercial fishing: Palau’s goal

With Palau now attracting in excess of 100,000 tourists annually, the country sees the benefit of maintaining its beauty and conserving natural resources that in turn attract visitors.

“Palau is very fortunate to be bestowed with natural resources not found elsewhere,” he said.

“This comes with a responsibility to ensure these are here for the next generation.”

Remengesau said the concept of people inheriting their islands from previous generations needs to be revised to: “We are borrowing our environment from our future children. We’re a fisheries money “negligible. It’s a drop in the fragile and small island. The only way to sustain

By Giff Johnson bucket.” ourselves is to put our environment first for our Because Palau is on the fringe of the Parties to Palau is aiming to become the first Pacific people and economic opportunities that come the Nauru Agreement (PNA) fishing area where nation to ban commercial fishing in its 200-mile from the environment.”

70 percent of the region’s skipjack tuna is caught, exclusive economic zone (EEZ). And in another Still, Palau is a frequent target of illegal fishing most commercial fishing is concentrated to the unprecedented move, it will conduct a trial next by foreign fleets and with only one patrol vessel, south and east of Palau. Palau is not as dependent month using drones for fisheries enforcement. the government is hard-pressed to conduct efon fisheries revenue as are Kiribati, Marshall IsSoon after taking office for his third tour-year fective surveillance. lands, Solomon Islands and other PNA members, term, President Tommy Remengesau, Jr. an“The enforcement side is very important,” making it easier for Remengesau to take this step. nounced his plan to ban commercial fishing and Remengesau said. The working group he has Under the PNA arrangement, Palau is allotted establish a working group to review the plan. established is considering ways to beef up marine about 500 fishing days a year, out of approxiHis announcement caused a stir in the fishersurveillance. His aim is to find innovative ways— mately 50,000 annually. At the current minimum ies and business world in large part because it is such as using drones and partnering with other sales price of US$5,000 per day, Palau’s potential unprecedented in a region where most countries governments and non-government groups—to depend heavily on revenue from foreign improve enforcement and expand cooperafishing nations. tion on conservation.

Remengesau’s long-term focus on enviRemengesau said he recently talked to ronment, dating back to his first two terms officials at the US Pacific Command in in office from 2000-2008, underscores his Hawaii who said the use of drones for belief that Palau’s resources are of value marine enforcement was “doable”. beyond dollar signs.

“We’re already doing shiprider surveilWhile it won’t be known until 2014 if lance with the US,” said Remengesau in the plan for what Remengesau describes reference to Palau law enforcement officials as a “total marine sanctuary” will go into who ride on US Coast Guard and navy effect, it is drawing support from conservessels for marine surveillance. Drone vationists. technology is available and “it’s an idea Noah Idechong, founder of Palau Conwhose time has come,” he said. servation Society and a former Speaker Palau will conduct its first drone tests in of the Palau National Congress, is on August. “We’re working with an Australian Remengesau’s working group reviewing drone manufacturer,” he said. the proposal.

“They’ve done a preliminary assessment Drones for enforcement...Palau President Tommy Remengesau, Jr. (center), “We have to do these things (for a sus- with Marshall Islands Foreign Minister Phillip Muller (right) and Foreign and said it can work.” tainable future),” Idechong said at the end Affairs official Neijon Edwards in Majuro, met with officials from the Marshall For Palau, its distant southwest islands of of May on a visit to Majuro where Palau, Islands and Federated States of Micronesia recently to update them on his Tobi, Sonsorol and Helen’s Reef are known Marshall Islands and Federated States of plan to rollout drones for fisheries surveillance in Palau. Photo: Giff Johnson areas of illegal fishing.

Micronesia officials met to discuss expanThe range of the drones allows for a sion of marine conservation management control center to be set up on Angaur Isefforts in the north Pacific.

PNA day sales translate to US$2.5 million. land, which is about 400 miles from these small “We don’t want the world to dictate to us. We “There really is not much tuna fishing in our islands and located near Koror, the capital, making have to think for ourselves.”

EEZ,” Remengesau said. “We can sell our fishing logistics easier.

Remengesau is blunt about his plan for a total days to augment other (PNA members).”

“The southwest islands are a hotspot for illegal marine sanctuary: “It is in our best interests to This way, Palau can have its cake and eat it fishing,” he said, adding that this area will be the do this. It is for the long-term sustainability of too. Even without fishing in Palau waters, it can focus of the initial drone enforcement work. PaPalau and our contribution to the region—no generate fisheries revenue by selling its fishing lau has one patrol vessel, the Australian-provided commercial fishing.” days to other PNA members, which it has done Remeliik. It costs US$37,000 to send it to the Remengesau believes there is momentum to successfully in the past. southwest islands and back on a patrol mission. make commercial fishing ban happen next year.

The business community will be concerned In contrast, to operate a drone for 20 hours costs “We’re looking at it from all angles and the about revenue and job loss if fewer fishing vessels US$360, he said. early review say it can work.” visit Koror for fuel, supplies and crew changes.

Without reliable information about the whereAnd Remengesau’s ratcheting up enforcement But Palau has already established a name for abouts of vessels fishing illegally in Palau waters, with the rollout of airborne drones, like those itself in the conservation world by effectively it can be a waste of time and money to dispatch being used by the US Government in the war in implementing marine “protected area networks” its lone patrol vessel.

Afghanistan and elsewhere. at the village level around Palau and by banning The plan is to relay information from the The first test of the drones will be conducted shark finning in its 200-mile EEZ. drones to the patrol vessel. Other details, such in August in Palau by an Australian company, Remengesau sees creating a total marine sancas the use of drone photographs for prosecution Remengesau said. tuary as the obvious next step in Palau’s effort to of vessels need to be worked out.

The main issue in the ban centers on how to conserve its resources. “We will be making our “We’ll do a dry run in August, set up the replace the approximately US$5 million annually contribution to sustaining the migratory tuna equipment and let our leaders see the drones in that Palau generates from allowing commercial stock as well as within Palau,” he said. operation,” Remengesau said. “We hope it will be fishing in its waters.

PNA’s tuna management is about “conservasuccessful and can be implemented throughout the Compared to revenues Palau is producing tion, not just selling fishing days (to distant water Pacific. We all share the same challenge of monifrom its tourism industry, Remengesau called fishing nations),” he adds. toring our borders, which are mostly water.”

And use drones for surveillance

40 Islands Business, July 2013

Fisheries forces evacuation if enough sea walls can’t be built—Tong’s signature issue.

In an interview in 2008, before contracts with foreign fishing fleets were unified under the Parties Nauru Agreement (PNA), Tong, a former fisheries secretary and minister, had said that if all of PIPA was closed, “your catch will be reduced, common sense would suggest that.” As a result, he said, some fishing companies would leave, depriving Kiribati of revenue.

But at the time, John Hampton, the Central Pacific’s chief fisheries scientist, had said, “Purse seiners need wide areas to operate, so I wouldn’t expect a lot of them would stop fishing in Kiribati just because they’re losing 11 percent of it.”

He recently added that his assessment hadn’t changed and other fisheries experts agree.

Since then, tuna prices have more than doubled in a few years to between $2,200 and $2,400 a ton and the profits of fishing fleets are now estimated at over 100%.

Given that the region holds the last major stocks of tuna—the international fleets have largely fished out tuna in the rest of the oceans— these fleets are less likely than ever to leave if PIPA Skipjack caught by a Chinese purse-seiner in Kiribati…unloaded in Majuro, Marshall Islands, to be canned.

Photo: Christopher Pala is closed, fisheries officials say, adding that while closing PIPA would inconvenience the fleets, they could easily fish around them.

New calculations by scientists at the University of British Columbia (UBC) show that not only would closing PIPA not cost Kiribati anything, it would be a wise business decision that would not only increase Kiribati’s yearly income from fishing licences but create a piggy bank with millions of dollars in it that would come in handy when rising sea levels force Kiribati to either spend money to raise the most inhabited islands or relocate elsewhere—Tong signature issue.

According to UBC fisheries scientist Ashley McCrea-Strub, who studies marine reserves, closing PIPA to all commercial fishIn the interview, Tong explained ing would result in a speedy increase

By Christopher Pala why the negotiations had failed: in skipjack density inside the reserve. he believes Kiribati should be “PIPA is big enough that some A decade ago, Gregory Stone and a group of compensated even more than preof the tuna inside it will spend all coral reef ecologists suggested to Kiribati’s leaderviously agreed. or nearly all their lives inside it, so ship that the long-ignored Phoenix Islands were a “Even if the return has increased they’ll be able to reproduce freely,” treasure that could bring the country prestige and from fishing (licences),” he said, she said. tourism as a world-class marine protected area. “it’s a lot more than it would have “These fish start breeding when But President Anote Tong said closing it to been if PIPA had been closed to they’re less than a year old, so the commercial tuna fishing would cost Kiribati all fishing. So there is that lost oppopulation could double in a few millions of dollars that would have to be comportunity cost.” years,” she said. And some of their pensated by creating a trust fund.

He brushed aside any notion that offspring, she added, will inherit the Stone, today the senior vice president and it would be hard to raise donations “lazy gene” that will keep them inside chief scientist for oceans of one of the world’s to help Kiribati conserve its tuna Anote Tong...Kiribati should be the reserve, accelerating the populabiggest conservation organisations, Conservation when the country’s income from compensated for its fisheries. tion’s growth.

International (CI), went along. But negotiations fisheries had doubled in a year.

“On the other hand, once the denon the level of compensation dragged on and Photo: Islands Business sity gets high, more fishes are going are still dragging on, with no agreement in sight.

New price tag to start venturing outside the reserve “We’re still deciding what the compensation Tong didn’t set a new price tag for closing the in search of food,” she said. level should be,” Tong said in a recent interview whole reserve, but the previous one was $50 That’s called a spillover effect and it’s prized by in Tarawa. million for the PIPA trust fund. fishermen, who tend to fish along the border of So far, fishing is banned only in the parts So far, the fund is still empty. Under the curmarine reserves because they find more fish there. around the islands where no fishing was taking rent management plan, unless CI raises $13.5 Daniela Alemany, an Argentine fisheries sciplace anyway, a total of three percent of the Phoemillion by the end of next year and Kiribati closes entist, studies a fishing closure in area off the nix Islands Protected Area (PIPA), as the manageoff an additional 25 percent to fishing, PIPA risks Argentine coast that’s a fourth the size of PIPA. ment plan available at phoenixislands.org details. losing its prestigious designation as a UNESCO Within a decade, the general fish population The size of California, the reserve wraps World Heritage site, the world’s largest. had doubled and the targeted species, a hake around Kiribati’s central archipelago. In the But scientists now say closing the whole rethat grows much slower than skipjack, had risen rest of it and in the rest of Kiribati’s Exclusive serve to commercial fishing not only would cost by 60 percent.

Economic Zone, fishing has intensified as global Kiribati nothing, but would be a wise business “Now most of the fishing boats fish along the warming push skipjack tuna east and prices soar. decision that would ensure a steady income for border of the reserve, where they catch more fish Last year, approximately 50,000 tons were future generations and provide a nest egg for the than anywhere else,” she said. fished inside the reserve, according to calculations time, in a matter of decades, when sea-level rise “It’s worked really well because the Argentine based on official fishing data.

Close reserve to commercial fishing, scientists tell Kiribati It will ensure steady income for future

Islands Business, July 2013 41

Fisheries government monitors the boats through a Vessel Monitoring System (VMS) that transmits their position from port to port.”

As it happens, VMS is mandatory in purseseiners that account for 90 percent of the take in Kiribati’s waters. The vessels use giant nets to surround and scoop up entire schools at a time, some as large as 70 tons.

In a recent interview, Tong said he wanted to renegotiate the PNA treaty. “It doesn’t seem to be fair,” he said, because it doesn’t let Kiribati sell the vessel days it wants when it wants. Last year, when tuna had moved in greater numbers into its waters, Kiribati sold 9,649 days, 4,000 days more than it had been allocated under the PNA rules, angering its seven partner nations.

For 2013, Tong said, “We are talking about 7,000 days.”

If the treaty is renegotiated, observers say, nothing would prevent Kiribati from charging a premium to fishing vessels for permission to fish along the PIPA border.

“The fishing boats would use less fuel and catch more fish,” McCrea-Strub said.

Tuna prices Beyond the spillover effect is the value of skipjack added to PIPA when its population doubles.

As the price of tuna continues to rise, driven by a demand in China, India and Latin America that isn’t likely to weaken, its value will rise as well.

“It’s money in the bank,” says McCrea-Strub.

In the rest of the Central and Western Pacific, she notes, the stocks of bigeye tuna are very depleted, the ones of yellowfin are somewhat depleted and the ones of skipjack are about at their limit of exploitation.

Meanwhile, the level of fishing keeps going up—it’s now 30 percent higher than in 2004.

McCrea-Strub estimated the landed value of the added half of skipjack stock would be $225 million at today’s prices.

But under the current arrangements, in which Kiribati does little fishing and simply sells the right to fish in its waters, it would get only about eight percent of the landed value of the fish or $20 million, if it decided to let fishing fleets back inside the reserve and take the surplus created with the closure.

Rashid Sumaila, a fisheries economist at UBC, says Kiribati should use the next decade or two it has before sea level rise becomes a big problem to build up its own fleet of purse seiners, or at least create joint ventures with foreign operators, keeping a far greater share of the fish’s value.

Namibia, he pointed out, forbids the kind of arrangements that Kiribati makes with foreign fleets.

It allows only home-based fishing fleets to operate in its rich waters and mandates that a large portion of the catch be processed locally.

Namibia now has a local fleet of 200 vessels (Kiribati has agreements with 270 purse seiners) that employs 130,000 people, according to the fisheries ministry.

Kiribati, where structural unemployment is high, could do the same. “Then the money from the fishery triples as it spreads through the economy,” he said.

Of course, he admitted, building an efficient, industrial fishing fleet isn’t easy, but with the income from fishing licences soaring with prices, “the time to start the process is now. If you don’t try, how will you learn?”

42 Islands Business, July 2013

PNG’s #2 cannery holds big promises

By Davendra Sharma Set to become world’s second largest tuna processing project in the world, a new plant in opened its doors to 4000 workers in Papua New Guinea’s fast-expanding industrial town.

As export demand grows from Europe and production peaks at the multi-million kina new plant, it will have the capacity to house 7,000 employees—making it one of the biggest employers in the region.

But Prime Minister Peter O’Neill’s optimism for an economic boom emanating from the plant goes beyond just jobs—economic benefits spreading across PNG’s second most populous city.

A new international airport terminal, refurbishing port and upgrading of road infrastructure are among hallmark changes O’Neill announced for Lae. The Majestic Seafoods operation is a product of a consortium involving Thai Union, Bangkokbased world’s biggest fish processor; Taihyo of Thailand; Century Canning Corporation of Philippines; and Frabellie (PNG) Ltd. PNG’s biggest trumpcard would be the preferential trade access into Europe, a market of 500 million consumers through Economic Partnership Agreement.

Lucrative Europe markets “That allows duty free access of all Papua New Guinea goods to the European market,” said Martin Dihm, European Ambassador to PNG. “It is the most lucrative market in the world.”

Thai Union, which manages the world’s largest tuna processing plant in Bangkok, moved to Lae with high investment hopes after eyeing enormous fisheries potential in PNG. “The fact that Thai investment comes here, I think it is a very good sign because it means it is better to produce here, to create jobs here than in Bangkok,” said Dihm.

There was also a word of caution in Dihm’s overwhelming response—the need to maintain environmental and other international hygiene standards in PNG. “What we have to consider, of course, is we look...very closely at stock conservation issues and at any labour issues and social issues,” he said.

“We have a regular committee...where we discuss all these issues together.”

Trade between PNG and other islands countries have swelled over the last three decades since the European Union began easing off sanctions to developing and least-developed countries.

Majestic expects to ship 80% of its products to Europe through favourable market access made available under EPA incentives and the remainder to be absorbed by the growing domestic demand.

Local media was told that the world’s second largest fish processing centre in Lae will run uninterrupted daily attending to 200-380 metric tonnes of fish per day.

It will be done from a single processing plant, a feat only achieved by the world leader in fish processing based in Thailand where 400-500

metric tonnes of fish are handled daily.

“In other countries, they have groups of factories and they process big amounts of fish then put them together in one plant alone,” said Morobe Provincial Administrator, Kemasang Tomala.

“Lae has a conducive environment for a fish factory business because the labour supply is very good, unlike many parts of Papua New Guinea and even the world where labour scarcity drives away investors,” he said.

Apart from 80 million kina initially poured in the construction of the plant, Lae has loads of more wealth-generating prospects opening for the city through processing jobs and income for small traders.

Lae Chamber of Commerce President Alan McLay was confident the far-reaching economic spinoff benefits from the inauguration of the fish plant in the city will open avenues for creating new industries.

“Such a big investment is making a difference.

They talk about initially putting on 4,000 workers and if things go well, they say they have facilities for 7,000 workers. So that is just a huge amount.”

Back in Port Moresby, the National Fisheries Authority managing director Sylvester Pokajam was also drumming up the beat to Lae’s Majestic Seafoods to becoming a big player on the global scene.

“We can be number one in the world," Pokajam said.

“Thailand is the biggest in the world today but we have the fish. That is why most investments are going into Lae because that is where the workforce is in abundance,” he said.

The project is the second major fish processing and cold storage facility to emerge in Lae in recent years. In 2008, the Chinese government handed over a 10-million kina fish processing and cold storage facility at Lae’s Malahang industrial centre under Beijing’s ever-growing Sino-Pacific plans.

Lae’s flourishing fisheries trade has grown from strength to strength over the last five years and with Majestic Seafoods’ expansion plans in another five years, it will see a full-on capacity production.

With the Chinese market hungry for fisheries imports from such countries as PNG, intangible benefits will continue to flow in to Lae and surrounding Morobe provincial areas.

With an annual GDP of A$18 billion, PNG has enjoyed an impressive 8.9% growth in recent years. Though trade in minerals and foreign aid dependency on Australia has held the country in good stead over its growth years, fragile industries like agriculture and fisheries have had to make a mark on the country’s overall GDP. PNG’s main industries have been copra crushing, palm oil processing, plywood production, wood chip production, mining of gold, silver and copper, crude oil production, petroleum refining, construction and tourism.

Exports of nearly $7 billion annually of mainly oil, gold, copper ore, logs, palm oil, coffee, cocoa and seafoods have been exported mainly to Australia (32%), Japan (7%) and China (6.5%).

Technology Frame 1

Frame 4

Frame 1 shows what the terrain around Nuku’alofa would look like if all the water Frame 4 shows the resulting inundation after the second wave hit Nuku’alofa. was removed from the ocean. Initially large areas of Nuku’alofa would potentially be Model animation: SOPAC inundated by water (in blue) directly as a result of subsidence caused by the earthquake.

New tsunami computer model Helps Tonga handle disaster

By Steve Menzies* The Secretariat of the Pacific Community (SPC) has developed a world-leading computer model to help the government of Tonga understand how Tongatapu would be impacted by a tsunami created by a magnitude 8.7 earthquake.

The model was developed together with Geoscience Australia with funding from AusAID and it includes data from the tsunamis that devastated Samoa in 2009 and Japan in 2011.

Leveni ‘Aho, Director of Tonga’s National Disaster Management Office, says the ‘Tsunami Wave Inundation Model’ is helping the Tongan government to determine evacuation zones, design emergency response measures and improve long-term urban planning for Nuku’alofa and surrounding villages.

“The tsunami computer model has provided the government with a wonderful tool to help us really understand the risks of different scenarios and to prepare in the best ways we can,” he says.

Mosese Sikivou, deputy director of SPC’s Disaster Reduction Programme, says the project is part of the SPC’s assistance to Tonga in connection with its Joint National Action Plan for Climate Change Adaptation and Disaster Risk Management which was approved by cabinet in July 2010.

“At community level, there is little practical difference between disaster risk reduction and climate change adaptation.

“Climate change adaptation and disaster risk reduction both aim to reduce the vulnerability of communities and contribute to sustainable development,” he says.

Sikivou says the work to develop a tsunami inundation model for Tongatapu is part of a more integrated approach the SPC and other partners are taking right across the Pacific to try and maximise scarce resources and minimise duplication of effort and potential conflicts in policy development.

“The new information provided by the tsunami model is helping the Tongan government to make plans to prepare for possible tsunami event. But it is also helping to inform longer-term decisions about whether to relocate homes and infrastructure away from low-lying areas.

“It is clear these important planning decisions will also help protect these communities from the impacts of projected sea level rise,” he says.

In July 2013, the Pacific will be achieving a global first when the two main regional conferences on climate change and disaster risk management (DRM) will convene a joint meeting of the Pacific Platform for DRM and Pacific Climate Change Roundtable in Nadi, Fiji.

The outcomes of this meeting, organised jointly by SPC, SPREP and UNISDR, will feed into the development of a Pacific Integrated Regional Strategy Sikivou says SPC’s commitment to integrate climate change adaptation and disaster risk management efforts will help Pacific Islands countries improve the way they identify and manage a range of risks their communities are exposed to.

Tonga’s Deputy Prime Minister and Minister of Infrastructure Samiu Vaipulu says his government approached SPC’s Disaster Reduction Programme in 2009 immediately following the 8.1 magnitude earthquake and tsunami that devastated the island of Niuatoputapu, approximately 600km north of Tongatapu.

“Ever since we had the tsunami that hit Samoa and Niuatoputapu, we wanted to be ready and keep our people informed of what to do and where to go if another similar event occurs in the future. We lost 11 people in Niuatoputapu and we need to make sure that Nuku’alofa and our other communities are prepared,” he says.

Nuku’alofa has a population of more than 34,000 people, roughly one third of Tonga’s population, and much of the city is situated along the coast perpendicular to Tongatapu’s northern coast.

The new tsunami inundation model shows that an 8.7 magnitude earthquake in the Tonga Trench would create a wave that would hit the eastern coast of Tongatapu within 10-20 minutes, leaving only four small high points in Nuku’alofa that would not be inundated.

The SPC estimates that an event of this magnitude could put up to 2000 lives at risk if no preparation measures are put into place. The deputy prime minister says the new information provided by the computer model has greatly helped them to adapt their previous plans.

“The data that was shown to us in cabinet is very different from what we expected. We now know that the eastern side would be the most vulnerable area but before we thought it would be the western side,” he says.

He adds this new information is now also being used to help the government to consider a range of potential scenarios that can be used to guide the location and construction of infrastructure and housing.

After the model was presented to cabinet and the’National Emergency Management Committee (NEMC), Prime Minister Lord Tu’ivakano indicated the government will need support to construct access ways to some parts of Nuku’alofa so that the local community can quickly evacuate themselves to safe areas.

The deputy prime minster says this issue has now become a priority for government.

“On the western side of town, we have some access roads but there are no escape roads on the eastern side of Nuku’alofa. They’ll have to go back to the main road, which is where the tsunami should come from. So it’s very dangerous. We’ve been looking at plans on having escape routes out from that area. It’s really a concern for us now,” he says.

‘Aho says the computer model has enabled Tonga’s National Disaster Management Office to consider how the public would need to respond in a range of possible scenarios.

“Nuku’alofa has perhaps the biggest urban population in the Pacific living in a very low-lying area. We can talk about Japan’s earthquakes but if we can present something that shows what is going to happen to us here at home, the message is much more effective.

“For us it’s an excellent opportunity to help the communities to be aware of what could possibly come and what they will need to do if a significant event occurs,” he says.

• Steve Menzies is SOPAC’s communications adviser.

Islands Business, July 2013 43

Environment

SPREP Column By Kosi Latu*

Make each day a day to protect our oceans

The UN theme of ‘Oceans and People’ is an Each year on June 8, around the globe, easy one to relate to in the Pacific Islands region. people stage activities to celebrate World Oceans Our traditions, cultures, legends and song all tell Day since its designation by the United Nations of lengthy journeys undertaken by our ancestors in 2008. in settling these islands, guided by the sun, moon Profiled on the UN Law of the Sea website is and stars or behaviours of fish, dolphins, whales the 2013 theme—“Oceans and People”. and birds.

However, a look at the www.WorldOceansDay. This link between the ocean and our people org site, cites a two-year theme from 2013-2014 continues through to this day and is evident in as “together we have the power to protect the how we are still heavily dependent on it for susocean”. tenance, transport and more increasingly income.

As celebrated last month, this is only a small On the latter use, significant investment has reflection of the numerous global activities been made into understanding the economic role undertaken to celebrate the ocean and all that of oceans in the lives of Pacific Islands communiit represents. While the themes may vary, the ties and one such area that is gaining attention, is underlying strand is a call to action for the protection of this watery wonderland.

Through scientific literature, conservation and management programmes, media outreach and education, we are increasingly being sensitised to the essential role the ocean plays with regards to food security, health and survival of all life, how it influences climate and generally being a critical part of the biosphere.

We are also exposed to the myriad of threats to this habitat, the species within and those it supports.

At the Secretariat of the Pacific Regional Environment Programme (SPREP), we believe that everyone should work to ensure they cel- Keeping oceans clean and healthy...vital. Photo: SPREP ebrate our oceans every day, and by adopting good environmental that of whale and dolphin-based tourism. practices into our lifestyles, we can work to Globally, whale watch activities generate some protect our ocean on a daily basis.

US$2 billion while employing 13,000 people.

One simple action is to reduce your waste or Here, in the Pacific, a 2008 report estimated dispose rubbish responsibly; this avoids the posthat direct expenditure on whale watching sibility of waste finding its way into our ocean and amounted to US$7.5 million. Additionally, the reduces the possibility of marine life mistaking industry also grew by 45% over seven years. waste for food. Another good habit to take on is to use re-usable bags instead of plastic bags.

Potential opportunities This also reduces the likelihood of their ending While a more recent assessment of the industry up in the oceans. in the region needs to be undertaken, the potenWe have the largest continuous marine habitat tial opportunities for contributing to national with our Pacific Ocean covering up to 35% of the economic growth is significant. earth’s surface. While we know that it is home to Perhaps the most successful case in our region six of the sev is that of the Tongan whale watch industry. In the en extinct marine turtle species including the small island kingdom, whale watching has been critically endangered leatherback, and a multitude known to amass up to US$1 million annually of cetacean species including the endangered with the potential of becoming a multi-million oceania humpback whale, the Pacific Ocean still dollar industry. has mysteries yet to be discovered.

44 Islands Business, July 2013

Recently though, Tonga passed regulations that govern the operation of the whale watch industry.

This should be seen as a significant milestone.

This show of support by Tonga is in line with the Whale and Dolphin Action Plan which is part of the Pacific Islands Regional Marine Species Programme 2013-2017, developed by SPREP in partnership with our member countries.

It demonstrates Tonga’s commitment to balance national economic gains brought about by watching live marine mammals against ensuring that the growth and management of the industry is done sustainably and in a manner that does not impact negatively on the animal, its habitat, the user and the experience provider.

Across the region, there are other examples, at different scales, of whale and dolphin based tourism. They range from full scale commercial operations to smaller community-based initiatives.

While this is encouraging, science indicates though that the number of whales, particularly the Oceania humpback whale population, has not recovered from previous whaling expeditions of the 19th and 20th century.

This is not welcome news for those whose businesses are dependent on these seasonal visitors—both human and marine.

While World Oceans Day was in June, we continue to reflect on the value of these animals and the health of the ocean—both they and we are dependent upon. Healthy oceans are ones that will continue to support our growth as a people.

Healthy oceans will continue to support the movement and survival of these iconic animals as they move from their feeding grounds to warmer seas for breeding.

It is an ocean where threats of ship strikes, habitat degradation and modification, noise, fisheries interactions and climate change should be minimised or eliminated.

Addressing these threats however, is not for one country or one organisation. Rather, it is a call to action for collaborations and partnerships across these oceanic basins and in reiterating another theme to protect our ocean—“together we have the power to protect the ocean”.

• Kosi Latu, Deputy Director-General, SPREP

Environment

Pacific Islands’ deadly threat from climate change for Almost A 70 yeA yeArs Ars, my country, the Marshall Islands, has been fighting for its survival.

Unfortunately, the threats we face are the result of forces we cannot control.

From 1946 to 1958, we enBy dured the horror of 67 atmoPhillip Muller* Muller spheric nuclear tests. The most powerful was the “Bravo shot,” equivalent in power to 1,000 Hiroshima bombs. Now, our residents are confronted by a different kind of atmospheric danger: the existential threat posed by climate change.

After a prolonged and unseasonable drought that began late last year, the severe lack of drinking water in our northern atolls led my government to declare a disaster area on May 7. This humanitarian crisis is climate-induced. About 6,000 people are affected by severe water shortages and are surviving on less than one litre of water per day. All of the affected communities have lost the staple crops that provide their daily food.

My people are not only thirsty and hungry, they are also getting sick. The drying water wells are contaminated with bacteria and salt. Diarrhea, pink eye, flu and other drought-related diseases are on the rise, particularly among children, and we are on the brink of a much wider outbreak. With no significant rain forecast until at least July, the situation is likely to get worse.

Since January, my government has been working to relieve the crisis by shipping drinking water and basic supplies to the affected communities. Our very limited resources cannot sustain this effort.

We desperately need assistance from abroad.

We are grateful for the generous help we have received thus far from the United States, Australia, the Republic of China (Taiwan), India, Israel, Japan, the Asian Development Bank and the New Zealand Red Cross, which have provided financial aid, reverse-osmosis filtration units and other emergency supplies.

Two weeks ago, U.N. agencies began providing logistical support and humanitarian experts to assess the situation—but much more needs to be done.

While we struggle to respond to today’s crisis, we know that further crises lie ahead. Climate change has become the No. 1 threat to my country and our people.

Last month, the world reached a milestone that brings all of us to a new danger zone: an atmospheric carbon dioxide concentration of 400 parts per million.

The World Bank predicts we are on track to a rise of four degrees Celsius in temperatures by

the end of this century. This would mean a rise in sea levels of three to seven feet.

For the world’s lowest-lying countries, including my own, this is a death sentence. The only answer is urgent global action, a Marshall Plan for a new low-carbon global economy. And we Marshallese believe we have a big role to play.

In early September, we will host the 44th Pacific Islands Forum Summit, bringing together leaders from the Pacific islands, Australia and New Zealand, as well as dialogue partners from many of the world’s biggest emitters of greenhouse gases, including the United States, China, the European Union, India, Japan and Canada.

In light of then Secretary of State Hillary Clinton’s welcome visit to last year’s forum, we urge Secretary of State John Kerry and other climate leaders to attend.

The theme of the meetings in Majuro, our capital, is Marshalling the Pacific Response to the Climate Challenge. The gathering comes at an important moment: U.N. Secretary General Ban Ki-moon is planning a global summit on climate change in 2014, and the world has committed to adopting a new global climate treaty the following year.

But in the Pacific, we cannot afford to wait. Sadly, we are learning the terrible realities of living with climate change. My family built a sea wall around our home, but it was destroyed by waves.

The rising tides come closer every day.

We are trying to raise the alarm and lead by example. The Republic of the Marshall Islands is accelerating its transition to low-carbon development, using solar power and exploring promising ocean-energy technologies.

But our efforts will put only a tiny dent in this problem. The major emitters around the Pacific Rim account for more than 60 percent of global greenhouse gas emissions and their share is rising.

They must do more.

We want the September forum to set the stage for a new, bolder approach. We will propose a Majuro Declaration for Climate Leadership as a roadmap for tangible action in an effort to set aside the you-go-first dynamic that has stalled international climate talks. We call on not just governments but also intergovernmental organisations, private sector and civil society to sign on to our declaration with their own measurable commitments aimed at averting a climate catastrophe.

The world must answer our clarion call.

Otherwise, our paradise and many like it will be lost forever.

...in the Pacific we cannot afford to wait. Sadly, we are learning the terrible realities of living with climate change.

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• Phillip Muller is foreign minister of the Marshall Islands and the opinion piece appeared in The Washington Post Islands Business, July 2013

Business Intelligence

Shipping companies to register first For years, irregular shipping has been a constant element of the discussion agenda for transport ministers of Pacific islands countries and territories (PICTs) and this has led to calls by Pacific leaders for safe and secure international, regional and domestic shipping services that are regular, reliable, affordable and sustainable.

“In carefully studying shipping patterns in the region, SPC realises the very close collaboration amongst shipping companies render little or no competition to the PICTs, resulting in a near cartel environment.

“To address this situation, regulating shipping services through treaty by controlled competition along the lines of the Micronesian Shipping Com-

Shipping companies that currently provide services to the four PICs (Kiribati, Marshall Islands, Nauru and Tuvalu) include Matson, Neptune Paill irregular shipping services in the cencific Line, Pacific Direct Line and Swire. tral Pacific be a thing of the past?

The CPSC technical committee—whose memThere are expectations it will be when bers are the transport ministers from the four the Central Pacific Shipping Commission (CPSC) PICs—had met in Suva, Fiji, in May. It also met with takes on its official role as a shipping regulator later representatives of the four shipping companies. this year.

“It was the first time CPSC had engaged with Kiribati, Marshall Islands, Nauru and Tuvalu are shippers directly to discuss the challenges shippers members of CPSC, an initiative born out of Pacific face when providing services in the CPSC region,” small islands states’ calls for reliable, affordable and said Rounds. suitable shipping.

“For most ships, it is a one-way traffic when it “Once the commission begins operation, comcomes to servicing small islands states. Empty conpanies vying to provide a shipping service to the tainers are shipped back due to limited exports. central Pacific countries will be required to register “Then there is an with CPSC and aladded biosecurity/ lowed to operate in quarantine cost to the area only with ensure the containthe commission’s ers brought back are approval,” the Secreclean or pay around tariat of the Pacific F$300 per container Community (SPC) for fumigation,” he said in a media readded. lease last month.

Shippers also SPC has been struggle with inadmanaging the secreequate port infratariat functions of structure and SPC the CPSC since it revealed this will be was set up in 2010. resolved in the not SPC shipping adtoo distant future. visor John Rounds CPSC technical committee...which met in Fiji in May. Photo: Secretariat of the Pacific Community.

Port upgrade in told Islands BusiKiribati is almost ness that regulating complete and ships shipping in this Pawill now be able to berth and discharge cargo alongmission (MSC) model was adopted. cific sub-region will ensure that all member states side the wharf.

“In essence, the shipping commission aims to must be served and on a regular basis.

Furthermore, Nauru is planning to build a new regulate cartel-like operations and protect approved “In the Pacific islands and more so the smaller wharf, to be funded by Japan, which is expected to shipping companies from cherry pickers given the islands states, shipping is critically important for its reduce ship turnaround time from four days to one small market economies of the small islands states,” socio-economic survival. But it is often left to the day, SPC said. said Rounds. service providers to make marginal routes viable, Until the commissioner’s meeting—which is “CPSC will serve as a medium for consultation which can lead to irregular service and high costs tentatively scheduled for this month—SPC will be on matters affecting international shipping services due to the small market size,” Rounds said. working with the CPSC Technical committee to to all of its members. It will cooperate in advanc“By joining together to coordinate services operationalise the commission. ing an attractive shipping environment to service regionally, all countries will benefit from the inA call for expressions of interest will be made providers and form a united front for the negotiacreased economy of scale available to shipping comafter CPSC ministers of transport endorse all reltion of favourable shipping services through joint panies, making services more viable and secure in evant operational documentation. regulation and enforcement of shipping policies.” the long-term.”

By Dionisia Tabureguci

W

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46 Islands Business, July 2013

© 2012

New opportunities in PNG real estate A

fter several years of rapid growth in Port Moresby’s residential real estate sector, the market is in consolidation mode. In response, investors are eyeing commercial and retail segments for new opportunities.

Government data show that the finance, real estate and business services sector grew by 10% in 2012, down from 20% the prior year. In 2013, expansion is projected to fall further to 1.5%, according to the Department of Treasury.

Another indicator of a slow-down in the residential market is a decline in the rate of growth for home loans, which fell from 150% for the year ended March 2012 to 41% for the year ended September 2012, according to the World Bank.

While this is still fast-paced expansion, caution among lenders is rising. Equity demands for loan approval have reportedly risen from 10% in 2009 to more than 30% in 2013.

Fewer projects are being launched, but on-going market deceleration is not all bad news. It has provided the first opportunity since 2009 for renovations in mid-tier properties, and market conditions have not yet affected the top-end residential market, which has held its ground, according to Ingrid Richardson, general manager at Strickland Real Estate, a local realtor.

“We have found that the good properties are

still able to lease quite readily and sustain the rents that they have been achieving. It shows that there are still companies that are prepared to pay higher rates of 4000-5000 kina per week for the right property,” she told OBG (Oxford Business Group).

Yet throughout the market, there is a visible retreat from further residential investments. Focus has instead begun to shift towards the commercial and retail sectors, which are expected to retain their momentum.

Demand for retail properties is growing as incomes rise and urbanisation continues, loosening the informal market’s hold on the economy.

“Retail shopping centres could be another area of interest. There has been activity in this asset class lately with three new supermarkets in Port Moresby.

“As customer demand matures and shopping expectations rise, there may be more opportunities in this segment,” Andrew Esler, acting managing director of Nambawan Super, one of PNG’s largest pension funds, told OBG. Initial investments are already indicative of developers’ confidence in the sector. Garamut Enterprises’ 100 million kina retail complex—Waterfront Foodworld—opened in August 2012, the first phase of a seven-stage, 20,100-sq-metre Waterfront Mall that will eventually include residential, commercial and retail facilities.

In 2012, owners of PNG’s largest retailing network, CPL Group, also broke ground on the 9300-sq-metre Waigani Central Retail Complex.

This project is set to be completed in 2014 and will include a supermarket, shops and a cinema.

These developments will join Port Moresby’s first major retail success story, the 1 billion kina 45,000-sq-metre Vision City mall. Looking ahead, developers are expected to focus on smaller projects in both the retail and commercial segments.

Nambawan Super’s 9900-sq-metre OPH Tower is the largest tower under construction today, far smaller than the already completed 14,000-sq-metre Deloitte Tower and the 15-storey Pacific Place.

Other developers, such as Pacific Palms Property and CB Builders, are working on projects that will lease office space to tenants looking for less than 200 sq metres.

Such design trends are likely the future of PNG’s real estate development, but there is a possibility of price movement. Port Moresby’s commercial sector has maintained record market rates of 1300-1600 kina per sq metre, up from 600 kina five years previously.

However, with about 25,000 sq metres of additional space set to come onto the market by the end of this year, prices are expected to decline.

—Oxford Business Group/PACNEWS

Conferences boost Solomons’ visitor numbers

By Robert Matau

T

had served in the colonial administration in the Solomon Islands.

“So the activities they would participate in are visiting colonial administration centres which are sporadic around the islands.

“UK divers also come on packaged tours. If they are using Bilikiki Cruises travelling around the country to dive spots, they would normally spend up to two weeks.

ourism numbers in the Solomon Islands have been boosted following an increase in the number of business conferences and meetings held there, according to the latest 2012 figures.

The Solomon Islands Visitors Bureau recorded 23,925 visitors in 2012, compared to 22,941 in 2011, Solomon Islands Visitors Bureau Marketing Manager Freda Unusi told Islands Business.

“Indicators show that the increase has been due to the increase in the business and conference sector in the international arrivals,” Unusi said.

“There has been an influx of business people travelling to the Solomon Islands to attend business conferences and business people searching for fresh opportunities in a destination that is yet to be explored and yet to fully realise its potential in the South Pacific region,” she said.

In her market survey, she found that tourists from the United Kingdom tend to Divers...a big market for the Solomons. Photo: Mere Tuqiri spend up to 20 days to allow them to see the Solomon Islands. There are over 900 islands to see.

“To see the Solomon Islands one has to spend at least one to two weeks to really see the “If they go diving in the Western province, they people and activities. would start diving in Gizo, travel to Munda where “So travelling around the islands is a factor as they dive for a few days and travel to Marovo and to why they stay longer in the Solomons. explore dive spots in Uepi and Peava.”

She said UK visitors to the Solomon Islands She said this would take a visitor almost two were mainly those whose parents or grandparents weeks to accomplish.

The other group are the birdwatchers who would go island hopping to visit islands with organised bird watching activities, Unusi said.

The number of hotels has also increased from 133 in 2010 to 141 in 2011 whilst the number rooms increased from 1,526 to 1,556 for the same period. The tourism belt of the Solomon islands in the Western Province welcomed five new hotels—Lolomo Eco Lodge in Vonavona Lagoon, Ravaine Homestay in Munda, The lodge in Banaga Island, Zea Eco Lodge in Roviana Lagoon and the Titiru Eco Lodge in Rendova.

Sanalae apartments went up in Honiara whilst Farmane Motel and Maringe Lagoon Lodge were built in Buala in Isabel Province.

She said the air visitor survey would help SIVB gain a better understanding of characteristics of visitors to the Solomon Islands, particularly information on what visitors do, how much visitors spend during their stay and what they spend it on.

The survey would also give the bureau a better understanding of the Solomon Islands as a travel destination.

SPTO chief executive Ilisoni Vuidreketi said the survey is part of SPTO’s activities to assist its member countries across the region, which will also be implemented in 2014.

The project which is an initiative of the Pacific Regional Tourism Capacity Building Programme and funded by the European Union, is expected to be completed in October.

Islands Business, July 2013 47

RAMSI Update

Celebrating the successes of a 10-year partnership

R

Ten years ago, more than 1000 soldiers, police and civilians from Australia, New Zealand and other Pacific Islands Forum countries arrived in Solomon Islands as part of the Regional Assistance Mission to Solomon Islands (RAMSI). Here, Special Coordinator Nicholas Coppel looks at what has been achieved in the decade since then.

AMSI came at the invitation of the Solomon Islands Government under laws passed unanimously by the Solomon Islands National Parliament. The mission has sion, accountability institutions, the Ministry of over the past decade had its fair share of chalPublic Service and Office of the Prime Minister. lenges and critics. But in partnership with the It has also helped Solomon Islands to reinvigogovernment and people of Solomon Islands, it rate parliamentary committees, resolve a backlog has also achieved much of which we can all be of cases in the Ombudsman’s Office, develop a very proud. code of conduct for public servants and create a These successes can be attributed to several new centralised IT system. factors but high on the list is the realisation by the Since 2008, Solomon Islanders have led all people, communities and all levels of leadership the audits carried out by the Office of the Audithat their beloved Hapi Isles needed help. tor General.

According to the People’s Survey, support for The law and justice pillar has produced a RAMSI never fell below 85 percent of Solomon number of key outcomes since 2003, notably the Islands’ population. restoration of law and order and The regional nature of the surrender of almost 3,000 RAMSI, with its endorsement firearms. by the Pacific Islands Forum It has brought correctional under the Biketawa Declarafacilities up to UN standards tion of 2000, was also a big part and is working to rebuild the of the mission’s long lasting justice system so it can operate success. effectively, fairly and openly.

With people from every Solomon Islanders now head Pacific Islands Forum counthe majority of the nation’s law try included in the RAMSI and justice posts—with the Chief military, police and civilian Justice, Attorney-General, Direcprogrammes, the barriers that tor of Public Prosecutions, Pubcould be caused by different lic Solicitor and Commissioner people and cultures were mifor Correctional Services all nimised. The willingness by being Solomon Islanders. Crime the people of Solomon Islands is stable at low rates. to accept people from other The economic governance Pacific islands countries into pillar has helped achieve a subtheir communities made a great difference to the success Nicholas Coppel...RAMSI’s Special stantial recovery in the Solomon Islands’ economy and public of RAMSI. Coordinator. Photo: RAMSI finances. This has been facilitated Solomon Islands is now a by the restoration of law and different place from the nation order, successive governments that RAMSI found on arrival in displaying fiscal discipline and control, committhe early hours of 24 July 2003. ment to economic and financial reforms and the Law and order has been re-established in the support of development partners. communities. The Royal Solomon Islands Police Over the past decade, the economy has grown Force (RSIPF) has been rebuilt and is gradually steadily by over 80 percent in real terms, interregaining the confidence, trust and respect it once rupted only by the effects of the Global Financial had from the community. Solomon Islands now Crisis in 2009. Government revenue has recovhas functioning government systems and the ered strongly and expenditure grown and become economy continues to grow every year. more controlled.

There are still the usual challenges confrontThe government has delivered mainly baling any developing country in any part of the anced or surplus budgets over the past decade. world but as has been reflected by numerous This fiscal discipline, combined with debt workindividual testimonies to the Truth and Recouts and agreements in the early period of RAMSI onciliation Commission, people have seen the and no new borrowings over the last decade, has result of taking up arms to try and solve their seen an impressive turnaround in the public secproblems. However, there will be no going back tor’s debt position. to that path again.

This has positioned the government to be able RAMSI’s development assistance programme to undertake limited new borrowings for high over the past decade has focused on three areas quality infrastructure/social investments. or “pillars”.

The stability over the past decade has provided The machinery of government pillar has an environment in which investment and trade helped to strengthen institutions, including the have been able to grow. This has buoyed the National Parliament Office, Electoral Commis48 Islands Business, July 2013

private sector, providing increased employment and other opportunities for Solomon Islanders to support themselves and contribute productively to society. Economic reforms that have been introduced, including cuts to import tariffs, have helped reduce costs and stimulate growth. The introduction of telecommunications competition in 2010 has led to better coverage and halved retail costs.

The achievements over the last decade need to be viewed in the context of the events over the five years or so prior to RAMSI’s arrival. Between 1998 and 2003, the economy and public finances experienced a massive collapse—real GDP fell by around 62 percent and the decline in real GDP per capita was even greater as the population continued to grow.

Mission changing Now ten years later, the mission is changing.

It is certainly not leaving just yet. As part of its transition, which has been endorsed by the Solomon Islands Government, RAMSI is to continue as a policing mission for a further four years until 2017.

Around 150 police officers from Australia, New Zealand and other Pacific Islands Forum countries—which make up the RAMSI Participating Police Force (PPF)—will continue to provide training and support to the RSIPF especially in leadership development, public order management, logistics, human resources and administration. The PPF will retain its armed capability to back up RSIPF where needed and as requested.

RAMSI’s military component is now leaving, reflecting the fact that their job is done. The last time the military were formally called upon to assist the police restore public order was seven years ago in 2006. Most members of the RSIPF are now undergoing specialised training in public order management or crowd control.

As part of the transition, RAMSI’s development programmes will shift across to long-term bilateral aid programmes. They will be managed by the Australian and New Zealand High Commissions in Honiara as well as other development partners.

So as we celebrate the 10th anniversary of RAMSI, I would like to pay tribute to the efforts of everyone including the people in communities throughout Solomon Islands, the country’s leadership, both at the national and provincial levels, RAMSI personnel including those who lost their lives in the line of duty and the governments of the Pacific Islands Forum countries for their part in the successes of the mission thus far.

Request for Proposal (RFP)

Review of National Building Code and Building Control and Standard Regulation for Cook Islands The increase in the severity and regularity of natural disasters within the Cook Islands in the recent years has instigated various disaster mitigation methods and strategies to reduce risks, which may lead to eventual loss of life and property in a severe event.

The Government of Cook Islands and the Secretariat of the Pacific Communities invites eligible consultants to indicate their interest in providing services to review the Cook Island National Building Control and Standard Regulations 1991, the Building Act 1991, National Building Code and Building Manual 1990. Interested consultants must provide information indicating that they are qualified to perform the services outlined below. Consultants may associate to enhance their qualifications.

The Request for Proposal (RFP) and other related documents can be obtained from the Secretariat’s offices or downloaded from the SPC website (http://www.spc.int/) http://www.spc.int/) under procurement notices http://www.spc.int/en/procurement-and-consultancy-opportunities.html. http://www.spc.int/ For any additional information or clarification on the RFP, send e-mail request to procurement@spc.int . The closing date for submission of proposals is 4.00pm on 5th July 2013, and the proposals need to be marked “CONFIDENTIAL” and addressed by mail to: Request For Proposal (RFP 13/32) Secretariat of the Pacific Community Private Mail Bag Suva FIJI ISLANDS or hand delivered to SPC offices at 3 Luke Street Nabua, Suva.

CAUTIONARY NOTICE TRADE MARK – MICRONESIA, PALAU, MARSHALL ISLANDS and REPUBLIC OF NAURU Notice is hereby given that AbbVie Inc 1 N. Waukegan Road North Chicago IL 60064 United States of Amercia

is the sole owner and proprietor in MICRONESIA, PALAU, MARSHALL ISLANDS and REPUBLIC OF NAURU of the trade mark shown below:

ALUVIA Which is used upon or in connection with the following goods: “Antiviral pharmaceutical preparations” Notice is also hereby given that

Islands Business Magzine Advertising Rate Full page (205mm width x 275mm height trim size) $2400.00 Half horizontal (180mm width x 120mm height) $1560.00 Quarter page vertical (89mm width x 120mm height) $850.00

The above owner claims all rights in respect of the above trademark and will take all legal proceedings against any person, firm or corporation counterfeiting, imitating, violating or otherwise infringing the said rights of the owner in Micronesia, Palau, Marshall Islands and Republic of Nauru.

MUNRO LEYS Lawyers & Notaries Public Pacific House, Butt Street, PO Box 149 Suva, Fiji.

For all your advertising needs, contact: Abigail Covert-Sokia (acovert-sokia@ibi.com.fj) or Phone: 679 3303108 Fax: 679 3301423

Islands Business, July 2013

TRADE MARK CAUTIONARY NOTICE IN MICRONESIA, NAURU, PALAU AND NIUE Notice is hereby given that ZHENGZHOU YUTONG GROUP CO., LTD., a Chinese corporation of No.8 Changchun Road, Hi-tech Industrial Park, Zhengzhou, China, is the sole proprietor in Micronesia, Nauru, Palau, Niue and elsewhere of the following trade mark:

Use in respect of:Drilling machines; Agitator; Road rollers; Steamrollers; Mixing machines; Whitewashing machines; Beating machines; Concrete mixers [machines]; Bitumen making machines; Bulldozers; Shovels, Mechanical; Excavators; Tarring machines; Rail-laying machines; Road making machines; Railroad constructing machines; Diggers [machines]; Rams [machines]; Earth moving machines; Ditchers [ploughs]; Power shovels [machines]; Machines and machineries used in earthwork construction in the field of building, bridge and road construction; Concrete vibrators [machines]; Loading and unloading machines; Hoists; Cranes [lifting and hoisting apparatus]; Starters for motors and engines; Shock absorber plungers [parts of machines]; Shock absorbers for machines; Road sweeping machines [self propelled]; Sewage pulverizers;Washing apparatus; Vehicle washing installations; Electric machines and apparatus for cleaning; Waste disposers [machines]; Garbage disposals; Waste disposals;Trash compacting machines; Waste compacting machines; Dredging machines; Sorting machines for industry – Int. Class 7 The said proprietor claims all rights in respect of the above trade mark and will take all necessary legal steps against any person or company infringing their said rights.

MUNRO LEYS Lawyers & Notaries Public Pacific House, Butt Street, Box 149 Suva, Fiji

TRADE MARK CAUTIONARY NOTICE IN MICRONESIA, NAURU, PALAU AND NIUE Notice is hereby given that ZHENGZHOU YUTONG BUS CO., LTD., a Chinese corporation of Yutong Road, Guancheng District, Zhengzhou, China, is the sole proprietor in Micronesia, Nauru, Palau, Niue and elsewhere of the following trade mark:

Use in respect of:Fork lift trucks; Lifting cars [lift cars; Sprinkling trucks; Motor buses; Motor coaches; Trucks; Caissons [vehicles]; Caravans; Trailers [vehicles]; Hose carts; Tractors; Waggons; Cycle cars; Electric vehicles; Vans [vehicles]; Refrigerated vehicles; Military vehicles for transport; Sports cars; Tilting-carts; Tramcars; Vehicles for locomotion by land, air, water or rail; Cars; Motor cars; Automobiles; Concrete mixing vehicles; Ambulances; Camping cars; Motor homes; Snowmobiles; Remote control vehicles, other than toys; Axles for vehicles; Sleeping cars; Gear boxes for land vehicles; Bodies for vehicles; Torque converters for land vehicles; Oil tank trucks; Cars for cable transport installations; Casting carriages; Cleaning trolleys; Water vehicles; Air cushion vehicles; Shock absorbing springs for vehicles; Luggage carriers for vehicles; Vehicle wheels; Hubs for vehicle wheels; Vehicle chassis; Vehicle bumpers; Brakes for vehicles; Doors for vehicles; Vehicle suspension springs; Rims for vehicle wheels; Vehicle seats; Upholstery for vehicles – Int. Class 12 Motor vehicle maintenance and repair; Vehicle wash; Vehicle service stations [refuelling and maintenance]; Vehicle cleaning; Vehicle breakdown assistance [repair]; Vulcanization of tires [tyres] [repair] – Int. Class 37 The said proprietor claims all rights in respect of the above trade mark and will take all necessary legal steps against any person or company infringing their said rights.

MUNRO LEYS Lawyers & Notaries Public Pacific House, Butt Street, Box 149 Suva, Fiji

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