almost complete

Negotiations over "dotTV" almost complete

Negotiations over the future use of “dotTV” - Tuvalu’s name on the World Wide Web - will be complet

ed early next year, according to the country’s deputy prime minister Lagitupu Tuilimu.

“Over the next four to six months, the government intends to complete negotia tions and contractual arrange ments for the management and marketing of‘dotTV’. We are now in the final stages of this process in what we hope will ultimately yield substan tial, new financial returns to the country.

“But we will not enter into any deal until we are confident that we have secured the best deal the market has to offer, and which is in the best interests of the country,” he said.

Tuilimu, who is also the country’s finance and economic planning minister, said the government was looking for new tax relief measures to help boost private sector development.

Amongst these, it was considering the re introduction of accelerated depreciation allowances.

But Tuilimu said they were seeking out potential new sources of revenue from foreign exchange, which would offset the current need for domestic taxation.

Apart from the ‘dotTV’ sale, the gov ernment is also looking into sale of unutilised satellite space that has been allo cated to Tuvalu, and redesigning the Invest ment Passport Scheme in an effort to boost returns.

“Although our income base has widened considerably over the last decade, only about 50 per cent of the government’s recurrent revenue is derived from fundamen tally reliable sources such as taxation and service charges. All of our overseas licensing revenue is dependent on commercial con tracts, or, in the case of the Trust Fund, its portfolio performance in the international market in any given year.

“The continuation of income from I

these sources depends largely on sound busi ness relationships and on the successful mar keting of our products in an ever changing world-wide marketplace,” he said.

Tuilimu said that current estimates suggested that existing revenue sources will support annual employment growth of about 1.5 per cent annually.

But the country faces an

ongoing shortage of highly

skilled technical and profession al people.

“Even if recurrent, annual revenue is high we are limited in our ability to use this revenue, and earn the benefits derived from it, unless we can increase our productivity.

To do that will require training and then retaining higher numbers of skilled profes sionals to fill the gaps in the labour market,”

Tuilimu said.

One area the government is pursuing is financial viability of the Tuvalu Maritime School.

' With international donors, the gov ernment is constructing new training facili ties at TMS, such as the engine room simu lator and building, at a total cost of over $1 million.

The government intends to corpora tise TMS, but there is a risk that a corpora tised TMS will not generate sufficient rev enue to cover operating costs.

To overcome this, the government is evaluating options to ensure that the pro posed TMS Corporation has a secure finan cial future, Tuilimu said, including the possi-

bility of scholarships for trainees to attend TMS, and corporate support from interna tional maritime industry.

Tuvalu’s main mechanism for lifting national productivity is reform of the public sector.

Tuilimu said “despite unforeseen set backs in implementing several key initia tives”, some progress had been made.

These included the adoption of a new financial management information system, using an array of new computer hardware and software, and the establishment of a government assets register.

The current estimated value of the country’s assets -

including buildings, ships,

tractors, trailers, generators, computers - is $46.2 million, with a total replacement value estimated at $104.6 million.

Corporatisation of the Broadcasting and Information Office will take effect Janu ary 1 next year, following the bills final reading in Parlia

ment next month.

The first reading of the bill to corpo ratise Wharf and Port Services is scheduled for the March 2000 session of Parliament, with corporatisation expected to occur by year-end.

Interestingly, though, the number of establishment posts in government increased from 482 to 710 between 1995 and 1998, with the number expanding again this year.

Public service wages, salaries, and allowances have also increased by about $1.5 million, representing a real wage increase of over 20 per cent over the same period. In addition, a new housing benefit has been introduced for all public service

employees.

If this seems contrary to the reform process, Tuilimu sums it up: “Although the government strives to meet the needs of every citizen, we simply do not have the resources or the capacity to meet the demands and expectations of everyone ... but, we are trying.” ■