Pacific Commerce and Produce

Tonga's Traders

Hard Hit By

Money Troubles

Pacific Commerce and Produce

After 12 months of import jstrictions combined with

Dreign currency exchange con

•ols, Tonga appears to have liminated its overdraft over

las. But Tonga’s trading stores

re still in serious difficulties.

ITHEN the controls and restrictions » were brought in at the begin ing of 1965, Tonga had an un ivourable balance overseas of 150,000 Sterling, and the trading ores were prohibited from sending leir profits out of the kingdom.

However, they were assured that ly monies needed to cover their yerseas buying would be made avail :>le.

The exceptional increase in the (port of bananas to New Zealand as enabled the Government to fulfil s undertaking as far as that country concerned.

But suppliers in Australia and Fiji ave had to be content each month ith only a fraction of their out anding accounts, although the trad g stores concerned have ample inds to meet them.

Embarrassed

The trickle of funds released from ic Tongan Treasury to pay these :counts has embarrassed the trad ig stores, to say the least; and the iji and Australian firms affected— articularly the smaller ones—will "obably refuse to continue shipping Dods to Tonga if the position does at improve.

Meanwhile, the small Tongan orekeepers have been hard hit. reviously, these storekeepers bought om the big trading stores at whole ile prices. So they were not con dered for import licences when the aport restrictions were introduced.

Now that the large stores can no inger supply them with wholesale aods, many are forced to buy at ;tail prices and sell at black market rices, or to shut up shop.

The big trading stores are not in happy position, either.

Sales have dropped and they will )on be forced to cut overhead to ffset their smaller returns. This auld be done by importing more of ie higher margin profit goods and Jtting out others, which would

further reduce the range of goods now available; by discontinuing the importation of all perishable goods, thus saving on freezing costs; or by reducing their staff.

It has been stated officially in Nukualofa that the import restric tions and monetary controls are solely to correct an unfavourable balance of payments and to conserve overseas funds—not to create undue difficulties or hardships.

However, the controls and restric tions are doing just that, and it seems that until the Coconut Rehabilitation Scheme begins to bear fruit in seven years’ time, the Tongans will have to pull their belts in another notch and plant a few more bananas.

Rising Prices

The fact is that the community is faced with a greatly restricted variety of foods at increasingly high prices.

Onions and potatoes have now been added to the list of prohibited imports—to encourage local growers to produce more of them.

However as potatoes and onions have never been produced all the year round in Tonga, it is certain that for some months they will be completely off the menu.

The ban on these commodities has already caused the prices to soar.

The mid-February price for onions was 2/6 to 3/- a lb compared with 9d to 1/- a lb last year for imported onions. Potatoes were selling at 1/to 1/3 a lb compared with 9d last year.

As tinned meat imports have now been reduced, and with insufficient fresh meat available locally, con sumers have had to fall back on imported fresh meat from New Zealand. Here the prices range from 5/6 lb for chops and £l/10/- for a shoulder of mutton.

As for eggs, they are virtually un procurable at 8/- a dozen. Fresh fish has also nearly disappeared from the menu.

More Money Needed

For Misima

FUNDS provided by Cultus Explora tion Ltd., of Canada, for the development of the Umuna lode on Misima Island, Papua, will not be sufficient to establish a mill, but they may go as far as getting the mill

started, according to Mr. G. W. Noe chairman of Pacific Island Mines Ltd.

Mr. Noe said this at the annual meeting of PI Mines shareholders in Sydney on February 15.

Cultus, under an agreement with PI Mines, is required to spend SCI million on exploration on Misima Island, and to the date of the annual meeting it had spent about 5C225,000.

Mr. Noe said the Cultus money would develop the adit to intersect the Umuna lode and would be sufficient for other work up to starting the mill.

The capital involved in establishing the mill would be greater than the funds immediately available to either Cultus or PI Mines.

Asked how the company proposed

finance the mill, Mr. Noe replied lat the question could not be iswered at present.

The money could be raised by loans; :eanic Minerals Development Pty. ;d. (the development company) might s invited to join Cultus and PI ines on a joint venture basis; or ere might even be an approach to areholders.

“But until we know more about it id how much it is going to cost it is ipossible to say how we are going fund it,” Mr. Noe said.

He said the aim of the board was water down shareholders’ funds as tie as possible.

PI Mines would not be called on r additional funds in any form till iltus had spent its SCI million.

A final decision on the mill to be stalled for treatment of ore re vered had to await more detailed formation about the composition the ore body in depth.

That information would not be ailable till the adit programme was ;11 advanced.

If the adit was started, say, on pril 1, it would be well towards the d of this year before a start could made on designing the mill.

Mr. Noe said he thought the period 18 months for getting into pro iction after February, 1966, men med last year, was too short.

It could well be two years after pril 1 before a mill went into pro motion. It would take about 18 anths to establish the mill on the and.

opra Outlook "Not

uite So Bright"

*HE present outlook for copra is not quite as bright as it was flier in the year, although there is reason to anticipate any serious iling off in price, according to a sort by the chairman of the P-NG >pra Marketing Board, Mr. lan cDonald.

In the report, released on February , Mr. McDonald said: “Philippines FM copra prices have en falling steadily over the past ■ee weeks, from around SUS22O at J beginning of the month, to IS 212 on February 18, the date which our latest price information is available.

“It thus looks as though the erage price for February will be 3und £Stg.76/10/- per ton c.i.f., livered weights, UK/Continent.

“Generally the edible oil market in irope has been somewhat dull over 5 past week, with prices in all :tions dropping back more or less sympathy with soya bean oil and

coconut oil. Surprisingly, soya bean oil prices have been buoyant on the US market, hence it appears that European-grown rapeseed and sun flowerseed is providing some heavy competition for the import of edible oils.

“Cheaper butter may also have had an effect on the edible oil market, particularly in respect of coconut oil.

“World production of oils and fats in 1966 is estimated to be at a record 36.8 million short tons. Most of the estimated increase over and above 1965 production is expected to be in edible oils, although the 1966 fore cast is only 17 million tons against the estimated 1965 production of 16.8 million tons. This means, of course, that there will still be a fairly close balance between produc tion and consumption.”

New Appointments

For W. R. Carpenter

THE W. R. Carpenter Holdings group had satisfactory sales, and profits were maintained in the half year to December 31, the directors reported in February.

They said that present copra pro duction from associated and sub sidiary companies in New Guinea had been affected by drought con ditions, and in Fiji, production had been affected both by drought and a hurricane.

The interim dividend has been held at 7i per cent.

Mr. John Maynard Hedstrom has been elected to the chairmanship of Morris Hedstrom Ltd. and to the board of W. R. Carpenter Holdings Ltd. following the death of Mr. H. E.

Snell (see p. 153). Mr. Hedstrom, who is 57, is the son of the late Sir Maynard Hedstrom, co-founder of Morris Hedstrom Ltd., a member company of the W. R. Carpenter group.

Mr. David Crowe has been ap pointed managing director of Morris Hedstrom Ltd. Mr. Crowe, who is 55, joined Morris Hedstrom’s in 1936 as a shipping clerk, and has been a director since 1958 and general manager since 1959.

Copra Exports Down

In New Hebrides

NEW HEBRIDES export statistics for 1965 show that while the total tonnage of all exports was marginally higher than in 1964, copra exports in 1965 fell by some 9.000 tons. Exports of manganese, how-

ever, rose by 9,000 tons and fish by 500 tons.

The fall in copra exports was largely the result of the 1964 hurri cane which, followed by unusual climatic conditions, caused great damage to coconuts especially in the north of the Group.

The main products exported from the New Hebrides last year were: Copra, 28,725 metric tons (37,666 metric tons in 1964); manganese, 79,384 tons (70,174); frozen fish, 3,365 tons (2,872).

Other exports included 117 tons of frozen meat to Tahiti; 58 tons of sandalwood to France; and 514 tons of cocoa.

New Project's To

Develop Fiji

PROJECTS and suggestions for the development of Fiji have been announced in Suva at a dizzying rate in recent weeks.

Two projects which will be proceeded with soon are: • The appointment of a business consultant in the United States at a fee of £F 12,000 a year in an effort to attract new industries to the Colony. • A survey of the Colony’s trans

port system to establish a high priority transport plan for 1966- 1975, and similar plans for the needs of 1976-1985, and 1986-1995.

Fiji is also seeking assistance from the United Nations Special Fund for a large scale forestry development project; and an Australian banker has suggested in a report to the Government that Fiji’s Agricultural and Industrial Loans Board should be converted into a Development Bank to cope with an expected upsurge in the demand for finance.

The plan for a business consultant in the United States was put forward by the Government and approved by the Legislative Council in February.

The Financial Secretary, Mr. H. P.

Ritchie, said that Fiji had begun to industrialise over the last few years but needed to move very much faster.

“The Government considers that there is need to develop industry to cater for the steadily expanding local market and to develop Fiji as far as possible as the industrial centre of the South-West Pacific, as well as exporting industrial products outside this area,” he said.

Mr. Ritchie said the business consultant would promote an interest in investment in Fiji. Fie would make contact with American business men

SUVA'S HIGHEST BUILDING: Suva's most modern and highest office building (above) was opened officially in mid-December by Sir Derek Jakeway, Governor of Fiji. It is the Colonial Mutual Life Assurance Society's five-storey structure which has been erected on the site formerly occupied by the old Central Buildings in central Suva. The building represents an investment of £F250,000. It is air conditioned and in addition is fitted with aluminium sun-breakers to further reduce heat and glare. The building includes a modern lift. Photo: Rob Wright.

and industrialists and try to interest them m specific projects in Fiji.

Mr. Ritchie also announced that the British Government had been asked to engage a firm of consultants to carry out a survey of industrial possibilities in Fiji.

A grant of about £F224,000 by the United Nations Special Fund has been made for a pre-investment survey of the Fiji transport system.

Fiji will provide about £F30,000, and during the three years the survey will take, the Colony will also contribute about £F 166,000 in technical work, office space, staff and transport.

Some of the main points to be considered are the best combination of land, air and sea transport; roads; airstrips; inter-island commerce; coastal Hovercraft services; and the financing of proposals recommended.

The first stage of the survey will be a study of the existing transport system. The next stage will be a high priority transport plan for 1966-1975. The forestry development project for which Fiji is seeking assistance from the United Nations Special Fund could become a major employer of labour, bring in massive export earnings and use extensive areas of land unsuitable for other cro P s -

The Fund is being asked for a team of experts to prepare and initiate a long-term plan for the development of a fully integrated forest industry. This envisages not only a rapid expansion of planting but the development of local in dustries to process forest products both for local consumption and for export.

The cost to the Special Fund over four years is tentatively estimated at about £400,000. Fiji would have to make a cash contribution of about £33,000.

Fiji has suitable land for forestry, a favourable climate and quick growing species of trees which have been thoroughly tested under local conditions. It is estimated that there are up to 3,000 square miles (about two million acres) of land which have no competing agricultural demands and which could support a planting programme of up to 50,000 acres a year of softwoods and hardwoods.

Produce from such a massive planting programme could ultimately bring in export earnings, even at present day prices, of £2O million a year if shipped overseas as round woods and £lOO million a year if exported as processed products, The conversion of Fiji’s Agri cultural and Industrial Loans Board

into a Development Bank with an initial capital of more than £1 million, has been recommended in a report prepared for the Fiji Gov ernment by Mr. W. A. Buettel, Queensland manager of the Common wealth Development Bank of Aus tralia.

Mr, Buettel forecasts that with a rising population and an increasing level of individual prosperity, a climate will be set up over the com ing years sufficient to attract new secondary industries and to lead to the expansion of existing ones. The board could then expect an upsurge in the demand for finance.

He strongly recommends that a Development Bank should be given the widest possible charter. However, he envisages that for the coming years at least, the bank would con fine its activities to those at present undertaken by the board.

Gloomy Outlook For

Mining Company

THE annual report of Enterprise of New Guinea Gold and Petroleum Development NL is a gloomy docu ment and so is a circular issued with it. The odds are that the company will go into voluntary liquidation.

The directors consider that if the company does not do this, there is no alternative but to seek further funds from shareholders to enable the company to carry on its present port folio and to secure further invest ments in leading mining companies, and/or to seize opportunities in mineral ventures which might become available.

At the last balance date, August 31, 1965, the company held shares worth SA 19,846 at cost, but the market value was less than half that sum—s9,34o.