Fiji sugar sales

look safe

By a staff writer

Fiji earlier this year sent a high powered team to the United States to negotiate for a bigger sugar quota.

The team may as well have stayed home as the US House of Represen tatives, surprisingly, in June, defeated a bill which would have extended for another five years the 40-years-old Sugar Act, which controls quotas.

Thus, from 1975, Fiji as one of the 31 countries which has a quota in the US, will have to compete for a share of that market.

The quotas have been of immense benefit to producing countries, for the prices paid by the US have generally been higher than world prices. But in the last four or five years the world demand for sugar has risen to such an extent that producers can command higher prices outside the US quota.

The London price on June 10 was £Stg 254.

Fiji should be in a position to take advantage of high prices on the US market in 1975. The estimated crop for the current crushing season is about 300,000 tons. Her commitments under the British Commonwealth Sugar Agreement ~nd to New Zealand should leave plenty over for the US, although adverse weather has affected production.

The declared total need for the US in 1974 is 12.5 million short tons of raw sugar. Domestic producers, including Hawaii and Puerto Rico, were allotted about 6.3 million tons, and foreign producers the remainder.

Fiji did not react kindly early in June to a statement by the NZ Minister of Trade and Industry, Mr Warren Freer, that long-term NZ

• Pictured is an artist’s impress ion of the completed building.

contracts with Fiji and Australia would ensure cheap sugar for New Zealanders for the next 10 years.

The Fiji Prime Minister, Ratu Sir Kamisese Mara, accepted an invita tion from the NZ Prime Minister, Mr Norman Kirk, to go to NZ to “discuss the agreement with a possible view to renegotiation”, Ratu Sir Kamisese hoped to take up the invita tion within a fortnight.

He said he would like a fair and reasonable price under prevailing circumstances. Presumably this was a reference to high world prices, given a kick along by inflationary pressures.

He also said no country liked to feel it was still supplying the cheapest food.

The Fiji Sugar Corporation and the NZ Sugar Co Ltd made an agree ment in 1973 for Fiji to supply New Zealand with 40,000 tons of sugar a year from 1974 to 1978. The arrange ments were confidential to the con tracting parties.

Fiji has supplied raw sugar to New Zealand for many years. In recent years she reached similar agreements with Singapore and Malaysia. The three agreements are aimed at giving security of outlet and price for the Fiji sugar industry.

Papua New Guinea took advantage of the recent visit by Ratu Sir Kamisese to ask Fiji to help it set up its own sugar industry. The Chief Minister, Mr Michael Somare, said Ratu Sir Kamisese and he had looked at the countryside, and Ratu Sir Kamisese told him PNG could go into the sugar industry without any problems.

Papua New Guinea should not have any trouble on the agricultural side of growing sugar. It grows a variety of “chewing” canes which are useful for breeding better commercial varieties of sugar-cane. In 1957, a US ex

pedition went to PNG to look for some of these varieties.

One member of the expedition, Dr John N. Warner, senior geneticist at the experiment station of the Hawaiian Sugar Planters’ Association, then told PIM it was almost certain that the sweet chewing canes origin ated in the New Guinea area. There was wild cane grown in New Guinea, which was suitable for breeding. Cane grown in Hawaii descended from cane collected by earlier expeditions to New Guinea.

Rice factor in

PNG living costs

From a Lae correspondent The consumer price index rose by 5.9 per cent in the March quarter, largely as the result of higher prices for oil imports, shipping freights and imported foods, including rice.

The bigger food bill gave some point to an address by the Chief Minister, Mr Michael Somare, to the people of Kaiapit, in the Markham Valley. He said that approval of his target of December 1, 1974, for in dependence would speed the process of developing a rice project in the Markham. The valley was quite cap able of growing rice, he said, but the Australian Government had stopped it because Australia was growing rice. Australia had ignored the de velopment of rice growing so it could export its own crop to Papua New Guinea.

The Chief Minister might also have said that tremendous efforts have been made in PNG since the end of the Pacific War to get a rice growing industry going. Some Euro peans grew rice in Markham Valley but gave up as cattle ranching de

veloped; indigenous growers, all the way from Mekeo to the Sepik, have also had sporadic enthusiasms for the crop.

None of these efforts has ever produced anything but a drop in the bucket of PNG’s total requirements.

One reason is that, traditionally, local farmers have favoured tree crops rather than annuals as the former do not require such sustained effort. Another reason is that it has now been proved that large mechan ised projects can produce better rice at more reasonable prices than a multitude of small peasant effort pri marily producing for themselves and selling their negligible surpluses. This has been shown in Fiji where the CSR rice project that was supposed to take the place of sugar in the Nausori area never got off the ground, and where the mill estab lished by the company processed nothing but rice imported from USA.

When the sugar mill closed those who had been employed in the in dustry spurned rice growing and simply got themselves jobs in Suva.

Fiji rice growing on a realistic scale never looked like a proposition until, in recent years, two feasibility projects were started in the Rewa and Navua River areas. Both pro jects were based on irrigated, heavily fertilised, weed controlled and mechanised methods. These methods are expensive but can be successful if the project is large enough, sufficient establishment capital is assured and the market is of sufficient size.

Mining Fiji's

magnetite sands

A shot in the arm for Fiji’s mining industry to complement the recovery of Vatukoula’s gold-mining enter prise, could come from the nearby Ba River delta in magnetite iron sands.

The chairman of Southland Mining Ltd, Mr Maurice Messara, says his company’s magnetite iron sands pro spect in Fiji has been outlined in the last year as a deposit of commercial size. The development of the project, with a proposed production rate of 700,000 tonnes of concentrates a year, is contingent on the negotiation of a long-term contract with Japanese interests.

Uiider contracts for similar material recently negotiated in New Zealand, prices were about SUSS to SUS 9 a tonne fob. The iron sands are pel letised and then used as feed for the steel-making process, producing about the same tonnage of basic steel as iron ore.

W. Samoa hopes

for duty free zone

From FELISE VA’A in Apia For many months past, a select committee of Western Samoan government “experts” has been carry ing out a feasibility study on a pro posed duty free industrial zone at Vaiusu. The study is nearly finished, and the government is now consider ing possible modifications before passing it on to parliament later this year.

The results of the study are as yet confidential, but reliable sources say it has been estimated that the mini mum cost of the project would be at least SWSIS million, a substantial sum.

The project would be an attempt to attract overseas investors to set ap business in the zone by allowing duty-free import of raw materials, generous tax concessions, and low Samoan labour costs.

The many concessions are ex pected to please the investors while Western Samoa is expected to benefit n many ways, including better jmployment opportunities for local people and more exports.

The idea of such a zone goes back ;o previous administrations though t is the present Minister of Finance, Sam Saili, who has tried to make it i reality.

Saili supports new industries, jspecially industries with export potential as he wants to see a better palance of payments position for Western Samoa.

But the project does not lack ppposition, especially by some key members of the Opposition. Firstly, he project is regarded as utopian as money to finance it would be hard ;o raise. It is believed that if money s available, it will be needed to inance the next Five Year Develop ment Plan, scheduled to start next However, it is believed that the Minister does not plan to depend on ocal money for setting up the zone, put that he will try to get the money is a gift (and possibly as a loan if jverything else fails) from the Japanese Government with which he las already been negotiating.

Apparently, the Japanese who are enthusiastic about the scheme have luggested that the Western Samoan Government first submit a prelimin iry proposal giving a general outline )f the project. A Japanese mission vould then go to Apia for a first hand look. The Japanese would then pe in a position to act.

Mr Saili told PIM while in Sydney pn his way home from Malaysia,

that the whole idea was to attract overseas capital and know-how, pro vide more employment and create an export trade. The goods emanating from Vaiusu would not be allowed on to the local market but would all be for export.

However, the Minister said, no decision had been made by the cabinet and forecasts on the success or otherwise of such a scheme were premature.

BSIP's goodbye to

the Aussie dollar

The Solomon Islands have a cur rency problem, according to an English expert, but no financial crisis.

It stems from the fact that the BSIP is to have its own currency shortly to re place Australian dollars and cents that it uses currently. It is thought that the local Melanesians might be suspicious of the new money.

Isn’t it possible that the experts underestimate the Solomon Islanders, who in the last couple of generations

have grappled with English half crowns, American dollars, Japanese yen, Australian £.S.D. and Australian dollars, and have still managed to survive?

If it is going to produce all the expected traumas, why change over at all?

The BSIP Governing Council agreed in principle in 1973 to intro duce BSIP currency at the beginning of 1976. Preliminary designs for the money have gone to England for further work.

A UK expert, Mr H. J. Tomkins, who has special responsibilities for currency and banking legislation in the Bank of England, has emphasised that a fundamental factor in success fully launching and establishing a distinctive Solomon Islands currency would be to get the confidence of the public, by convincing them that the external value of the currency would be maintained.

That would best be achieved he thinks, by ensuring that the currency is immediately convertible on demand into a currency of international stand ing, and an obvious choice of cur rency to back the Solomons currency might be the Austr r; an dollar, long familiar and trusted.

The main economic advantage, apart from the convenience of having reserve stocks of notes and coin im mediately available for issue against payment in Honiara, and perhaps other centres in the BSIP, would be the interest which would be earned on the currency backing.

Mr Tomkins also advised the BSIP Government on the introduction of banking legislation to regulate the entry and establishment of new banks.

New National Bank

subsidiary for PNG

The National Bank of Australia has formed a subsidiary to operate in Papua New Guinea. The bank will be known as the Bank of South Pacific Ltd and on October 1, 1974, it will take over the six-branch net work of the National. The principal branch is at Port Moresby. The others are at Lae, Boroko, Mount Hagen, Rabaul and Kieta.

Initially the new bank will be a wholly-owned subsidiary of the National. TLere is provision to issue shares to local people later. On the board are some of the “big names” in Australian commerce—Sir James Forrest, Mr R. R. Law-Smith, Mr J. L. Amies, Sir Rupert Clarke, Mr P. H. Finley, Mr Andrew Grimwade and Mr P. J. V. Ramsden.

The bank will set up a local train ing programme. The National has been in PNG for 17 years.