Business and Development

Bus business in Bougainville: who's playing the game?

The secretary of Bougainville’s secessionist Napidakoe Navitu As sociation, Barry Middlemiss, has dis covered that competition in the pas senger transport field in the Kieta- Arawa area can be quite fierce. The Napidakoe Navitu owns a subsidiary company, Navitu Enterprises, as its commercial arm.

Navitu Enterprises operates both buses and plush air-conditioned taxis (there are some four-wheel drive taxis, too, for use on genuine bush roads).

Mr. Middlemiss, in addition to his political responsibilities (increasingly, instead of), is manager of Navitu Enterprises.

During the last few months “pirate” operators have been embarrassing Navitu Enterprises by carrying pay ing passengers in vehicles not registered to do so. Navitu Enter prises, still not a robust company, has not been content to stand by mildly while the “pirates” eat into its profits.

Mr. Middlemiss complained to the police and, as a result, some of the pirate operators were booked while others received warnings. When this news spread, tempers began to rise.

The legitimacy of Mr. Middlemiss’s action was ignored. The climax came early last month when a group of six pirate operators came up to him at Arawa and threatened to “punch his eye through his head” if the police didn’t get off their backs.

Mr. Middlemiss said later that this was just one of numerous threats of physical harm that had been made against him. But Navitu Enterprises can play a tough game too.

In March, a shock announcement was made that Papua New Guinea’s Passenger Transport Control Board (PTCB) had given all bus licences in Kieta-Arawa to a company called Bougainville Transport in preference to Navitu Enterprises. Shock was the operative word—because Navitu Enterprises had already bought its buses and had been operating them under special licences for some con siderable time in anticipation of being granted the full licences.

Navitu Enterprises, facing heavy repayments on the purchase of its bus fleet, was stunned. Unless the decision could be changed, the Navitu could be in serious financial trouble.

Immediately an appeal was lodged with the PTCB, but action did not stop there.

The Navitu-dominated Kieta Local Government Council asked part owner of Bougainville Transport, mixed race businessman Francis Seeto, to meet with it. Council members forcefully told Seeto that he must refuse to accept the bus licences from the PTCB, They

rejected his offer to form a company in which both Bougainville Transport and Navitu Enterprises would have joint ownership.

Newly-elected member of the House of Assembly for Central Bougainville, Raphael Bele, in a vitriolic and vituperative speech, hit out at foreign-owned companies that gave themselves local names. And there the confrontation ended, with no hint of compromise.

With bated breaths, participants and observers await the result of Navitu Enterprises’ appeal to the

Ptcb.

USS is back

in the black

The Union Steam Ship Company has been making a profit since the end of January according to its chairman, Sir Peter Abeles, who was in New Zealand in April to meet Union Steam Ship directors.

Sir Peter, who is deputy chairman of Thomas Nationwide Transport Ltd., which controls the USS, said the new directorate had reversed the record of operating losses in a matter of months. Uneconomic services had been cut, subsidiaries and facilities merged and fuelling, insurance and provisioning arrangements changed.

The company was now smaller and more efficient.

Part of the streamlining consisted of the laying up of more than a dozen ships and the sale of about six others.

Solomons' record

timber exports

The Solomon Islands exported 9,130,624 cu. ft of timber last year, more than one million cu. ft in ex cess of the record total established in 1970. The timber earned the country almost s3i million, about $500,000 more than in 1970. Timber levies on the exports will bring in $225,000 to the government kitty.

According to the acting Conser vator of Forests, Mr. Tony Nash, the production increase of 12i per cent, over the previous year was in line with estimates made in the 1968 White Paper on forestry policy.

Confident outlook in

Western Samoa

Despite the devastating hurricanes of 1966 and 1968, Western Samoa’s economy continues to improve and 1972 will be no exception, United Nations Economic Adviser, Robert L. Clifford, told Apia Rotarians recently.

Copra and cocoa production should at least remain steady at 1971 levels.

However, with world copra prices still falling in 1972 and not likely to show a drastic recovery, it will be difficult to maintain export receipts.

On the brighter side, Potlatch is using shallow-draft ships to export its timber, tourism should show some increase with the construction of ad ditional hotel rooms, public and private expenditures on various development projects are continuing and remittances from Samoans over seas should continue to grow.

“The 1971 economy,” Clifford said, “was an improvement over the

1970 one. Exports increased 33 per cent, in value over 1970, largely due to a sharp rise in copra shipments.

Imports decreased 2 per cent, thus reducing the country’s record 1970 trade balance deficit. Tourism estab lished itself as the second largest earner of foreign exchange, after

agricultural exports.”

There continued to be a large in flow of funds from abroad in the form of Samoan emigrant remittances, external financing of public and private development projects, tourist spending and other things. An increase in the money supply in the country was indicated by an 18 per cent, rise

in bank deposits and a nearly 20 per cent, increase in Apia retail sales. The government’s financial position con tinued sound, with revenues running consistently ahead of expenditures, he said.

Mr. Clifford’s remarks reflect the figures in a recent government report which indicated that Western Samoa’s trade deficit in 1971 was 5W54,910,000, lower than in 1970, but still very high compared with earlier years. There was a favourable balance of payments of $W5266,919 as compared with a corresponding amount of $W5437,750 the previous year.

Price fixing turns

sweet to sour

Sugar is a scarce commodity in Western Samoa these days, and it’s only because merchants are cutting down on their orders or refusing to order at all. Of the few who do order, only a minimum amount of sugar is being sold.

What has caused all this is the present Price Control law which has set a ceiling price on sugar since March. The price may not be changed within a six month period, so this means the next price change, under the present law can only be made about September, and then again only if the Price Control Board sees the need for a change.

However, since the price of sugar was fixed in March, the actual landed cost of sugar has gone up consider ably and has already far exceeded the ceiling price established by the board. In fact it already did so in March.

And the trouble is that the board cannot do anything about it before September unless the law is changed.

Meanwhile the merchants must just grin and take it. They must either sell at a loss or not sell at all, and most are not selling except for brief periods of time if at all. No wonder members of the public are searching high and low for the sugar which always seems to elude them, and many have already started to order from nearby American Samoa.

The Chamber of Commerce has repeatedly protested to the Price Control Board about this unfair law but their protests are rather belated.

They should have fought when the bill was in Parliament.

Copper begins to

look like gold

With Bougainville Copper’s Pan guna mine in increasing production, copper concentrate is being regularly shipped off the island in $5 million loads. Bulk carriers leave the copper port of Loloho with between 18 and 21 thousand tons of the 30 per cent, copper concentrate in their holds.

Current price of copper on the London Metals’ Exchange is more than SA9OO a ton. It was estimated that the first two shipments of con centrate (the first to Spain and West Germany and the second to Japan) were worth about $10.6 million. But the company still has a long way to go to recoup its $4OO million invest ment in Bougainville.

Meanwhile, it was announced in Melbourne in late April that Bougain ville Copper had signed a contract

for annual deliveries of between 24,000 and 36,000 tons of copper concentrate to the United States’ firm, Philip Brothers. The contract which commences from the begin ning of next year covers a period of four years.

The announcement of the new agreement came hard on the heels of the compromise decision that reduced Bougainville Copper’s short term sales to Japanese smelters by 10 per cent.

New deal in housing

at Pacific Harbour

Staff housing with a difference is taking shape at the $32 million Pacific Harbour resort and residential development in Fiji. The first 40 of

163 staff houses will be completed by September. Twenty of these will have three bedrooms and a verandah, and the other 20 will contain two bed rooms.

The first house will be completed in June-July and one or more will be finished every three or four days during the following 10 weeks.

Employees are to have their own landscaped estate, with houses in corporating a South Pacific design.

According to Pacific Hotels and Developments Ltd. managing direc tor, Mr. Ralph Grierson, the houses will go with the job and will not be for sale. “We intend to establish a contented work force, enjoying above average housing standards,” he said.

The staff housing estate will include 35 industrial sites, shops, schools, sealed roads, underground cables.

PNG to shore

in timber company

Pursuing its plan to establish Papua New Guinea as a “going con cern” by the time independence comes to the territory, the Australian Government has moved to make the people shareholders in Common wealth New Guinea Timbers Ltd. through the Investment Corporation of Papua New Guinea, formed earlier this year as an instrument for obtaining local ownership in com panies.

Commonwealth New Guinea Timbers was formed in 1952 as a joint enterprise between the Aus tralian Government and a Canadian company, Bulolo Gold Dredging Ltd.

The Commonwealth Government had subscribed $1.5 million to the company’s paid-up capital of $3 million and this share will be sold to the Investment Corporation on favourable long-term loan arrange ments.

The idea behind the move, the Minister for External Territories, Mr.

Andrew Peacock, said, was to en courage overseas investment in PNG.

Eventually, the Investment Corpo ration will obtain local equity in a consolidated company formed by Commonwealth New Guinea Timbers Ltd. and interests in New Guinea owned by Placer Development Ltd. with which Bulolo Gold Dredging Ltd. amalgamated in 1966.

BSIP trade grows

across the border

“It was nostalgia that drove us down to the Solomons.” Thus speaks Papua New Guinea businessman Harry Green of a trip to Gizo Island which resulted in the formation of the joint PNG-BSIP owned Western Solomons Trading Company.

Harry Green has been in the New

Guinea islands since 1949 and has extensive business interests both in the Gazelle Peninsula and in Bougain ville, but it wasn’t until he went on a sentimental journey to the Solomons with planter Paul Mason last year that he thought of expanding even further south. On Gizo, Harry Green teamed up with old-timer Ernie Palmer, who’s lived there for 47 years.

An idea was born which reached fruition when the Western Solomons Trading Company opened its registered office in Honiara last September. Chairman of the board is Harry Green. Ernie Palmer is one of the five other directors, who include two Solomon Islanders.

The company has two main busi ness activities. The first is internal; cattle are bought from the islanders of Vella Lavella and Kolombangara and are taken to Gizo where the company operates a slaughterhouse and a retail butcher’s shop.

The second is a small but growing export trade to Bougainville. This consists mainly of fish and crayfish (currently worth SA 1,000 a month), but it’s expanding to include furniture from Honiara and artefacts (although a 50 per cent import levy on these is something of a deterrent).

Trial shipments of fish are now being made to Rabaul and this could become a permanent feature of the company’s operations. Harry Green is quick to praise the Solomon’s government which he says has given the new company “every courtesy and every co-operation”.

It appears that a very successful enterprise has grown from what was, initially, just a nostalgic visit to an old stamping ground.

What was that

about profits?

The incredible story of the “in credible profits” of the Carpenter group of companies might have been more than a nine-day wonder in Fiji, if the National Federation Party iad cottoned onto the report when it irst appeared in Australia’s national lady newspaper The Australian.

As it was, the story headlined “In

:redible Profits—Big company’s busi-

u SS , rak , es in the cash in Fiji” made he local newspaper scene too late for sbP political advantage. But it set he business community agog.

The Fiji Times reported that Mr.

Randolph Carpenter, 39 - year - old nanaging director of the giant Car 'enters group, had said to The Aus ralian, “We do have a problem get ing some balance in profits between iji, Papua New Guinea and Aus

tralia. We wanted to get them just aoout even, but with the incredible profits from Fiji and New Guinea, its tough”.

Just imagine what political whoopee the NFP, which was promising to provide free education in Fiji by taxing big companies, could have made out of that!

Mr. Carpenter had said that the Carpenter’s group, with an interest in about 20 companies in Fiji was doing a lot better since independence— ‘‘since we don’t have to wait for Whitehall to make up its mind or fight some local administrator with big ideas and ambitions”. There was never any official denial in Fiji that Mr. Carpenter had in fact made the “incredible profits” remark, although he was on the next plane to Fiji for meetings with departmental heads immediately after the story appeared.

“It was a chance remark, blown up out of context,” was the unofficial explanation. Kingdoms have toppled on less than that P In an attempt to turn off the heat, mm

the group’s financial operations during 1970-71. It was not the profits in Fiji that were incredible, he said, but the prospects.

“There is no doubt that the future prospects in Fiji are incredible, but last year we earned only 6.4 per cent. on the funds invested by the Group,” said Mr. Crowe. “This is well below tbe average return of 8.4 per ce 9 t - which Australian public companies earned and we intend to be at least that g°° d - Only b y increasing our profitability can we bor row the large sums required to pul ! our weight in developing the natlo P’ in meeting our customers’

B[°wmg needs and in creating empl °y men t opportunities.”

D °L tbe $ 4l - 2 million earned by W. , Carpenter (South Pacific) Ltd. year, he said, shareholders received $1.7 million. The company SJJjL 5 5k sup ß]|? ]rs 9 f fax and dutvtn S’- ™' 4 m,lllo f n

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rocrwr 7 CIOSCS Norfolk Island’s fish factory at Cascades closed its doors on May 2 and be l° ca l fishermen without a rea< ty market for their catches, Mr. J°hn Forking, the manager, said tbe falboff in the demand for freezer storage space was the main factor forcing the closure as the company had relied on its two sub stantial freezer rooms to provide a working margin for its overall opera- M ons ’ but husiness had fallen off since similar storage facilities had been developed elsewhere on the island.

The factory provided a supple mentary income for eight or nine island families, • The Japanese Government has decided to extend to Papua New Guinea the benefits of the Japanese scheme of tariff preferences for de-

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