SPARTECA under

fire

By Sudesh Kissun

AUSTRALIA and Fiji businessmen want the margin of preferential access allowed under South Pacific Regional Trade and Economic Co-operation Agreement (SPARTECA) to be pre served. They also want the operation of SPARTECA rules of origin to be re viewed and substantial changes made to criteria for eligibility. This was the message from the joint Fiji/Australia, Australia/Fiji Business Councils’ meeting that ended at the Regent of Fiji on June 12.

In a communique the councils noted the concerns with the operation of SPARTECA and urged all parties to work towards preserving the margin of preferential access as a matter of ur gency. “Such a change would have little impact on Australia and yet be a major boost to the Fijian manufacturing sec tor,” the communique read. Under SPARETCA’s rules of origin all exports should have 50 per cent local content to qualify.

Opening the meeting, Fiji’s Minister of Finance and Economic Planning, Paul Manueli, said Fiji’s exports had difficulty in qualifying under the local-content criteria of the rules of origin of

Sparteca.

“This is especially true for those exporters who have reduced their local

costs through efficiency, improvements

or for those aiming for the higher quality end of the market.” Manueli acknowl edged the Australian government’s re cent commitment to amend SPARTECA rules of origin to bring them in line with the revised Closer Economic Relations rules. These amendments will mean a number of additional costs will now be included as “local content”.

Manueli said the Fiji government felt that in order for SPARTECA to con tinue to assist Fiji’s exporters in making

the efficiency and quality improvements

necessary to be competitive on the world market, substantial transformations should be introduced as a test for access under SPARTECA.

“The introduction of substantial trans formation rules would allow labour productivity improvements in Fiji, with out jeopardising preferential access, en-

able manufacturers to move to the higher price range of the market; and encourage a wider range of exports from Fiji,” he said.

Visiting Australian Minister for Devel opment Co-operation and Pacific Island Affairs, Gordon Bilney, said his govern ment had recently “cleaned up” the definition of the rules of origin. Although the Australian government has not altered the basic criteria for determining rules of origin, Bilney thinks things should now be easier for Fiji exporters.

“We have clarified the detail and opened up the opportunities for honest businessmen while making it difficult for those who aren’t,”

For instance, factory and work costs will now include overheads in determin ing local content.

He urged Fiji businessmen to take advantage of the current concessions offered by SPARTECA for Fiji’s indus tries to become globally competitive.

Bilney also announced that his govern ment had recently adjusted its system of tariff preferences. Developing country preferences for textiles, clothing and footwear industries, chemicals, sugar, canned food, fruit juices and dried fruit will be phased out for all but the least developed countries and the South Pacific.

This means Fiji exporters will soon gain an extra five per cent point margin of preference into the Australian market over its competitors for these products.

The joint meeting also welcomed Fiji

government’s decision to transform Fiji

Trade and Investment Board into a one stop-shop and the proposed introduction of a single investment legislation to facilitate processing of investment ap

provals.

The meeting endorsed the need for an appraisal of the world of competitiveness of Fiji’s tourism industry to maintain and increase its market share in Australia.

It endorsed the industry proposal to boost spending in Australia commensur ate with the competitor’s promotional campaign and endorsed the concept that the government should contribute sub stantially to the campaign.

On Fijian participation in commerce, it was suggested that taxation benefits like Tax Free Factories and Tax Free Zones be extended to joint ventures with majority ethnic Fijian shareholders.

The meeting urged potential investors to seriously consider the benefits of meaningful and participative joint ven tures with indigenous Fijians.

As a practical demonstration of the council’s commitment to bringing ethnic Fijians into mainstream management, an annual scholarship program was also announced at the meeting. The first recipient is Fiji Development Bank’s Isoa Kaloumaira.

The meeting also urged government to facilitate the development of Namosi Copper Mine Project and expand the program at Emperor Gold Mining Com pany in Vatukoula. Delegates acknowl edged that the proposed expansion by Emperor and the Placer Namosi Project evaluation were significant indicators of the security Fiji offered investors. □

Bilney: rules ‘cleaned up'

Manueli: SPARTECA rules need changing